New Legislation Would Limit Wireless Contract Termination Penalties

Two advocacy groups, the Consumer Federation of America and the Consumers Unions, endorsed a bill yesterday that would limit the amount that wireless, cable, and telephone companies could charge customers for early cancellation of their contract. Specifically, it would require companies to waive cancellation fees for the first 30 days, and pro-rate any fees after the first 30 days (something Verizon already does, but no other mobile carrier that we know of).

A lawyer for the Consumers Union sums it up quite nicely:

Contract extensions and early termination fees are the #1 consumer annoyance with the wireless industry. Consumers are powerless to negotiate better terms with their cell phone carrier, but this bill would help to level the playing field.

The wireless industry’s major trade organization sent forth a lesser demon to announce that this counts as unnecessary interference, and that consumers can already avoid this whole issue by purchasing pre-paid wireless plans. Funny, we couldn’t purchase a pre-paid plan for our last two phones—we checked for exactly that reason.

“U.S. curbs sought on fees to quit wireless contracts” [Reuters]
(Photo: Getty)