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Report on Business CRTC introduces new rules for internet providers but consumer advocates say measures don’t go far enough

Canada’s telecom regulator has introduced new rules for internet providers aimed at making contracts easier to understand and providing clarity on prices, but consumer advocates say the measures don’t go far enough to address aggressive sales practices.

The Canadian Radio-television and Telecommunications Commission said Wednesday that the internet code of conduct will come into effect on Jan. 31 next year, joining existing codes related to the sale and provision of wireless and television services. The decision follows a public consultation that sought input from Canadians via social media this year.

The code will require the 10 largest internet service providers (ISPs) in the country to take steps to provide consumers with more up-front information about the terms and conditions of their home broadband contracts and more clarity around the potential for prices to increase, bundling different services and time-limited discounts. It will also force the ISPs to send subscribers notifications when they approach 75 per cent, 90 per cent and 100 per cent of their monthly data limits in the case of plans that include caps on usage.

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But consumer advocacy group OpenMedia said the CRTC decision failed to address the issue of misleading and aggressive sales practices. In a report this year that followed a public hearing ordered by the federal government, the commission acknowledged that telecom providers do engage in such tactics and said they harm vulnerable members of the public.

At the time, the CRTC said it would take steps to address that problem and said that one such step would be the process of developing an internet code of conduct, which was already under way. Now, OpenMedia executive director Laura Tribe says the code has not gone far enough.

“With this document, there’s a little bit of tinkering around the margins ... but it doesn’t address the systemic problem that this is a known issue throughout the major telecom providers," she said, adding that she would have liked to see financial penalties imposed on violators.

Ms. Tribe said the code puts too much responsibility on individual customers to seek redress for problems. She cited a rule that will allow customers to cancel, with no penalty, within 45 days of signing up if the terms in their contract don’t match up with what they were offered. She said that this does not actually give consumers what they were promised and could leave people frustrated and without internet service.

“This continues to be a customer-by-customer complaint system – there is nothing that says, 'This is a systemic problem and here’s what we’ll do about it,’ " Ms. Tribe said.

OpenMedia and certain other public-interest groups and academics did not participate in the consultation in protest of a CRTC decision to deny a time extension earlier in the process.

Consumer groups that took part, as well as the Competition Bureau, filed submissions with the CRTC arguing it should require ISPs to provide a written presales quote that sets out the terms and conditions of an offer. That would allow customers to shop around more easily and also provide a written record of what they were offered.

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The CRTC declined to mandate written presales quotes and chairman Ian Scott said the evidence on the record showed it would cost too much for the ISPs to comply with such a rule.

“It’s always a question of balancing what consumers say they want or need and the cost and burden associated with ordering carriers to do these things,” he said in an interview. He said that the new rules will require ISPs to “clearly communicate before a contract is signed what customers are signing up for,” and that providers must retain records that show that key contract terms were presented (though not necessarily in writing) at the time of the offer.

On the issue of addressing aggressive and misleading sales tactics, Mr. Scott said that it was outside of the scope of the internet code process. “This is an ongoing thing with other aspects to be pursued,” he said.

Minister of Innovation Navdeep Bains called the code a “welcome addition” in a statement, adding, "It will empower Canadians to demand fair treatment from their internet service providers.”

For its part, the Competition Bureau said it was pleased to have taken part in the process and spokesman Jean-Philippe Lepage said in an e-mail, “We will continue to work with the CRTC closely to determine how best we can assist them.”

BCE Inc. said Wednesday it is reviewing the decision while Rogers Communications Inc. said it welcomes the code, as it “promotes clarity and ensures consumers are better informed of their rights and responsibilities.” Telus Corp. called the code “balanced” and said it “introduces a number of practices that have long been in place” at the company.

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