New UAE rules on telecom contract cancellation fees take effect next week

Authority reminds customers of changes in cancellation policies for Etisalat and du

FILE - In this Sept. 22, 2017, file photo, customers look at iPhone 8 and iPhone 8 Plus phones at an Apple Store in San Francisco. Retailers are taking back some control of the store experience with smart phone app features that let customers do things like scan and pay and download digital maps. It marks a big difference from just a few years ago when retailers viewed the smart phone as their enemy - customers often whipped out their device to compare prices online and walked out of the store to buy elsewhere. (AP Photo/Jeff Chiu, File)

From New Year’s Day, early cancellation of a telecoms contract in the UAE will no longer set customers back up to a year in charges.

On Tuesday, the country’s Telecommunications Regulatory Authority reminded Etisalat and du customers of the change in regulations, which takes effect on January 1, 2020.

In March, the TRA announced it would reduce fees for the early termination of a contract. The amendment meant customers would be charged a fee of only one month, replacing the previous provision that charged users the total remaining sum due for the length of the contract. In some cases, this meant paying up to 11 months in fees.

The penalties for breaking a contract could add up quickly. For Etisalat plans, it cost either Dh50 or Dh100 times the number of months remaining in the contract, depending on the package.

For du plans, it was anywhere between Dh100, multiplied by the remaining months of a year-long contract to Dh1,000 times the remaining months of the second year for a two-year contract, also depending on the monthly package cost.

The change was immediately introduced to any new mobile contracts for Etisalat and du and, at the time, the TRA said it was working on updating existing contracts too.

In March, Hamad Al Mansoori, TRA’s Director General, said the amendment was made in response to customer complaints.

“At TRA ... we don’t hesitate to review any policies or regulations for the interests of the parties and the public, to increase the happiness of the telecom sector customers in the country.

“Revision of early termination fees of telecom contracts is part of the sustainability approach whereby TRA is working to enhance the quality of telecom services and to ensure that these services reach the various segments of society on satisfactory terms.”

Mohammed Al Ramsi, TRA’s Regulatory Affairs Director, said the change gave users more flexibility to choose services that suited them.

“The new amendment comes in response to the complaints of some customers, since the previous provisions forced the customer to commit to using the service until the end of the contract, despite their unwillingness to do so sometimes. Now, the user can terminate the service contract and choose another service, for a simple charge equals one month fee, which is considered operational fees.”