Rollover contracts that tie consumers into repeated fixed contract periods may be banned.

Rollover contracts for landline and broadband services that tie consumers into repeated fixed contract periods unless they opt-out may be banned under proposals set out by Ofcom.

These contracts, currently offered by BT and other telephone providers, automatically roll forward to a new minimum contract period – with penalties for leaving – unless the consumer actively opts out of the renewal.

The regulator claims that this makes it more difficult for customers to switch to a more competitive deal as the costs involved are unexpectedly high and stifles market competition.

Ofcom estimates that approximately 3.5 million consumers are on rollover contracts, and if the plans – which are at consultation stage – are given the go-ahead, providers who continue to offer this type of contract could face a financial penalty of up to.....Read more HERE