CRTC Finally Makes Cellphone Contracts Last Only Two Years

At long last, Canadians will be able to cancel their wireless contracts without penalties after two years.

Today, the Canadian Radio-television and Telecommunications Commission unveiled a new wireless code that brings cellphone contract lengths down from three years to two. Other changes include a maximum overcharge for data of $50 per month and a maximum overcharge for international roaming at $100 per month.

“The wireless code addresses the main frustrations that Canadians shared with the CRTC, which included the length of wireless contracts, cancellation fees, roaming charges and other industry practices,” says the CRTC.

Under the new code, consumers can return cellphones within 15 days if they are unhappy with their service and accept or decline changes to the key terms of a fixed-term contract. Service providers must also create contracts that are easy to read and understand.

“Every day, Canadians rely on wireless devices while in their homes, at their jobs, at school or travelling abroad,” Jean-Pierre Blais, chair of the CRTC, said. “The wireless code will contribute to a more dynamic marketplace by making it possible for Canadians to discuss their needs with service providers at least every two years.”

The wireless code will apply to all service providers in Canada. The effects of this new code will enter into effect on December 2.

According to Vancouver-based OpenMedia, the code is progress, but a number of important issues remain unaddressed.

“This is a positive start, but some of these rules will need to be built upon going forward,” says OpenMedia Communications Manager Lindsey Pinto. “What is most important now is that Industry Canada to do its part to fix our broken cell phone market. Canadians will never get the choice and affordability we deserve when just three companies control up to 94 percent of the market. At minimum the government should be enforcing its own rules, and stop the Big Three from swallowing up assets intended for new more affordable telecom services for Canadians and businesses.”

Canadians currently pay among the highest prices for wireless service in the industrialized world. A recent report found the average monthly cell phone bill in Canada topped $77 at the start of 2013, up nine dollars from $68 in 2012—an increase of 13%, or 13 times the rate of inflation.