Since 1 July 2009, it is easier for consumers to switch to another telecom provider, internet service provider or provider of programme services, like a cable company. This is the consequence of new rules aimed at limiting barriers to switching in the electronic communications sector and at strengthening the position of consumers in that sector.
With an amendment of the Dutch Telecommunications Act, which entered into force on 1 July 2009, conditions are regulated regarding tacit renewal of and the notice period in contracts between providers of electronic communications services and programme services on the one hand and consumers on the other hand.
Under the new rules, it will remain possible for providers to tacitly renew fixed-term contracts, as before. The major difference will be, though, that after the initial contract period has lapsed and tacitly been renewed, the consumer may terminate the contract at all times, free of charge, observing a one-month notice period.
Prior to this amendment, providers were able to bind their customers for relatively longer periods by continuing to tacitly renew subscriptions every year. This meant that new providers entering the market faced a particular difficulty gaining customers, as these were already bound to a competitor. In turn, consumers wishing to switch to another provider had to keep a close eye to the term of the contract and the notice period, in order to timely terminate the contract and to switch. Since 1 July 2009, upon tacit renewal of a contract for a particular period, consumers will be able to terminate the agreement at all times, observing the one-month notice period.
In addition, providers are no longer allowed to stipulate a notice period that is longer than one month.
Contracts for an indefinite time also remain permitted. However, since 1 July 2009 consumers may terminate such contracts at any time, free of charge, also with a maximum notice period of one month.
The rules are obligatory for all providers. This means that deviating provisions in, for example, general terms and conditions will not be upheld. If necessary, these provisions must be modified. It is also recommended that providers take a close look at the pricing of combined offers. An offer for a free telephone or digital receiver in combination with a subscription may turn out differently than before, if a relatively brief guaranteed recovery period from the subscription is offered in return.
It is expected that Dutch providers will become more active in their efforts to acquire new customers, as consumers who are ‘bound’ to their contract with a competing company will now be able to switch earlier.