Capping of Early Termination Fees Imposed by Telecom Operators on Consumers
Ministry of Digital Development and InformationSpeakers
Summary
This question concerns the tracking of early termination charges (ETCs) and the potential implementation of a cap to prevent consumers from facing excessive fees. Ms Yeo Wan Ling asked for data on ETCs over the past five years and whether a cap would be considered to protect consumers who are unable to pay. Minister Josephine Teo replied that while specific data is not collected, existing safeguards in the Telecom Competition Code and advisory guidelines effectively cap these charges. These measures restrict contract durations to 24 months, require ETCs to be proportionate to discounts and remaining contract time, and mandate upfront disclosure with written acknowledgement. Minister Josephine Teo added that consumers can also choose from various market offerings, such as no-contract SIM-only plans, to avoid such charges.
Transcript
104 Ms Yeo Wan Ling asked the Minister for Digital Development and Information (a) whether the Ministry has data on the number of times early termination fees were imposed by telecom operators on consumers in each of the past five years; (b) if so, what is the number; and (c) whether the Ministry will consider capping such fees to prevent excessive accumulation of charges where consumers are unable to pay.
Mrs Josephine Teo: The Ministry of Digital Development and Information (MDDI) and Infocomm Media Development Authority (IMDA) do not collect data on the number of times early termination charges (ETCs) are imposed by telecommunication operators on individual consumers.
IMDA has in place safeguards to prevent unreasonable ETCs, which are captured in the Telecom Competition Code and advisory guidelines. First, contract periods cannot be longer than 24 months. Second, any ETC charged must be reasonably proportionate to any discounts given and to the amount of time remaining on the contract. This effectively caps the ETC. Third, telecommunication companies must inform consumers of any applicable ETC upfront before subscription or upon renewal, and to obtain express written acknowledgement that consumers have understood these charges. IMDA will continue to monitor market developments and take enforcement action where operators are found to be in breach of these requirements.
Given the many telecommunication service offerings available in the market for consumers, including no-contract SIM-only plans, consumers can choose the services that best meet their needs.