Ofcom urged to change rules on auto renewal of telecom contracts

BARCLAYS RI Farm
ABOVE: Britt Megahey, Founder and MD of Barclay Communications, outside the industry regulator, Ofcom’s (The Office of Communications) Head Office in London.

BARCLAY Communications is appealing to Ofcom to change the rules that allow telecommunication firms to auto renew businesses contracts for up to five years.

Belfast-based Barclay Communications is launching a campaign in a bid to stop other telecommunications companies from automatically renewing landline contracts, which forces many businesses in Northern Ireland to overspend millions per year.

This is despite regulatory bodies informing telecoms firms that they must notify clients of an impending renewal in advance and in a timely manner.

Now, Barclay Communications, which specialises in advanced communication tools, said, currently, a lack of awareness in regulations is allowing telecoms firms to automatically renew businesses into an extended contract without warning or notice, for up to five years. It says the cost to the NI business sector amounts to approximately £22.5million over the last five years.

Often concealed within the small print of contracts’ terms and conditions, businesses are required to give between 30 and 90 days’ notice to avoid their contract being extended. The below contract clause, is by way of an example:

7. TERMINATION OF SERVICES

7.1 At the end of the Contract Term the Agreement will automatically continue for successive periods equal in length to the Contract Term (each such period a “Further Contract Term”).

7.2 The Customer may terminate this Agreement at any time provided that: 7.2.1 the Customer must give 30 days’ written notice.

Barclay Communications’ ‘Protect UK Businesses: Hang up on Auto-Rolling Contracts’ campaign comes as many businesses operate in survival mode during the pandemic. It hopes to support those businesses in maximising efficiencies and prevent them from paying out unnecessary high costs.

Britt Megahey, Founder and Managing Director of Barclay Communications, said the campaign will highlight the issue which many businesses may not be aware of. He is encouraging businesses to lend their support by signing a petition to ban the restrictive practice.

Mr Megahey, whose business supplies mobile, landline and software services to over 100,000 business end users across the UK and Ireland as well as a host of other communication tools, said: “Currently, the auto-rolling of fixed line or landline contracts could be potentially costing businesses in Northern Ireland up to £5million in overspend each year. Auto-rolling is exploitative and a very real concern.

“For anyone who may not be familiar with auto-rolling, it’s when telecoms providers enter into a contract with their client for a fixed period. Within the small print of the contract the client must give anything from 30 to 90 days-notice if they want to end, alter or review their contract arrangements. This clause is rarely informed and can be difficult to spot. If the customer is unaware of the procedures and fails to give such notice, they are automatically rolled into an extended contract, which could be for another 60 months, depending on the supplier.

“Right now, clients feel there is no way to get out of this contract and no way to appeal the renewal. As a result, there are a lot of unhappy customers. Though it’s not just NI businesses that are being affected by the issue, it’s a UK-wide problem.”

Britt continued: “At Barclay Communications we are totally opposed to auto-rolling of fixed landline contracts, because it’s not in the interests of clients. Often these rollovers can last for five years and in that period advancements in technology lead to improved pricing and more compelling solutions. This is why many companies are paying outdated rates.

“We have experienced savings of over 50 per cent for many customers and discovered that the majority have not reviewed their rates in over 10 years. Indeed, some companies were not even aware that a number of the services they were paying for were not being used. This for me calls for a change. At Barclay Communications we are committed to supporting business to have the freedom to choose their supplier and we believe that through our ‘Protect UK Businesses: Hang up on Auto-Rolling Contracts’ campaign we can lobby for the change that is needed, he added.

“We are encouraging businesses to stand with us and make a difference by signing our online petition and by sharing their experience of auto-rolling. We need this information to showcase the severity of the problem across the business community. We will present all information to the industry regulator, The Office of Communications (Ofcom) to encourage change in these regulations.”

n If you would like to sign the ‘Protect UK Businesses: Hang up on Auto-Rolling Contracts’ petition or share your business experience of auto-rolling click on the link below www.barclaycomms.com/help-stop-auto-renewal/

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