Telecom Regulatory Policy CRTC 2017-200

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Reference: Telecom Notice of Consultation 2016-293, as amended

Ottawa, 15 June 2017

File number: 1011-NOC2016-0293

Review of the Wireless Code

The Wireless Code (the Code) is a mandatory code of conduct for providers of retail mobile wireless voice and data services. The Commission created the Code to make it easier for Canadians to understand their mobile contracts, prevent bill shock, and switch service providers.

To ensure that the Code continues to be effective, the Commission is making targeted changes to the Code and clarifying existing rules.

As a result, the Code, among other things, now ensures that customers will be provided with unlocked devices, gives families more control over data overages, sets minimum usage limits for the trial period that correspond to at least half of the monthly usage limits of the customer’s plan, and clarifies that data is a key contract term that cannot be changed during the commitment period without the customer’s consent.

The targeted changes to the Code will take effect on 1 December 2017 and will apply to all new, amended, or extended contracts from that day forward. Certain changes will also apply to existing contracts. Until that date, all existing rules in the Code remain in effect and, where the Commission has clarified the way that these rules are to be interpreted, customers can have their complaints resolved according to these interpretations immediately.

Introduction

The Wireless Code (or the Code) is a mandatory code of conduct that applies to all retail mobile wireless voice and data services (wireless services) provided to individual and small business Footnote 1 customers in Canada. The Code sets out requirements for wireless service providers (WSPs) to (i) ensure the consumers are empowered to make informed decisions about wireless services; and (ii) contribute to a more dynamic wireless marketplace by making it easier for consumers to take advantage of competitive offers. The Code advances the telecommunications policy objectives established by Parliament and set out in paragraphs 7(a), (b), (f), and (h) of the Telecommunications Act (the Act). Footnote 2 To ensure that the Code continues to be effective, the Commission is making targeted changes to the Code and clarifying existing rules. The Wireless Code, as amended by this decision, is set out in Appendix 1 of this decision. Your Rights as a Wireless Consumer (the consumer checklist), an updated checklist that highlights the most important aspects of the Code for consumers, is set out in Appendix 2 of this decision.

Regulatory background

In Telecom Regulatory Policy 2013-271 (the original Wireless Code policy), the Commission created the Code and considered it appropriate to develop an evaluation plan to assess the effectiveness of the Code, three years following its implementation. The Commission considered that a three-year time frame was appropriate to (i) monitor compliance with the Code, (ii) ensure the Code’s effectiveness, and (iii) correct any issues that may develop during the implementation process. The Commission also indicated that it would provide guidance if WSPs or other parties were unclear about the application or interpretation of the Code, Footnote 3 and requested that the Commissioner for Complaints for Telecommunications Services Inc. (CCTS) Footnote 4 be the administrator of the Code. Footnote 5

Implementation report card

Following implementation, the Commission required all WSPs to report publicly on their compliance to ensure they were following the rules. In September 2014, the Commission published results in the Implementation Report Card which is based on the WSPs’ Compliance Reports.

Complaints reporting

As the administrator of the Code, the CCTS is responsible for, among other things, (i) resolving any complaints related to the Code; (ii) monitoring trends in complaints; and (iii) reporting on both complaints and trends in its mid-year and annual reports (the CCTS reports). Each year the CCTS reports publicly on all consumer complaints about the Wireless Code. These reports list the types of complaints that have been resolved and what steps were taken to resolve them. The CCTS has also published CCTS Annotated Guide to the CRTC Wireless Code (Annotated Guide), which sets out its interpretation of certain provisions in the Code. The relevant CCTS documents were placed on the record of this proceeding.

Public Opinion Surveys

Privacy report

The Commission also commissioned a report to provide an overview of the collection and use of Canadians’ personal information by WSP and third-party entities. The report was intended to assist the Commission with its review of the Code by providing insights as to how the Code is meeting its objectives with respect to its privacy provisions, in addition to contributing to the Commission’s overall understanding of current and emerging privacy issues in the wireless market.

Clarification decisions

In the original Wireless Code policy, the Commission noted that, as with any new set of rules, there may be issues of interpretation that it has not anticipated. To ensure the greatest benefit to consumers, if any part of the Code or a customer’s contract is ambiguous, or if it is unclear how the terms of the Code or the contract are to be applied, the Commission further directed that the Code and the contract must be interpreted in a manner that is favourable to the customer. The Commission reserved the right to issue guidelines of general application. Since the Code was created, the Commission issued several decisions that provide further interpretive guidance for certain aspects of the Code in response to requests for clarification. The Commission clarified how the Code applies to corporate plans; indeterminate contracts; tab contracts; Footnote 7 suspensions of service; and refunds for services not provided following cancellation. Footnote 8 While these decisions did not amend the wording of the Code, they made clear how the existing provisions of the Code were to be interpreted, given the overarching objectives of the Code and the guiding principle that ambiguity is to be resolved in favour of the customer.

Overview of the proceeding

In Telecom Notice of Consultation 2016-293, the Commission initiated a review of the Code and called for comment on the following issues: the effectiveness of the Wireless Code;

the evolution of the retail mobile wireless market since the implementation of the Wireless Code;

the content and wording of the Wireless Code;

consumer awareness of the Wireless Code; and

how the Wireless Code’s effectiveness should be assessed and reviewed going forward.

The proceeding included a two-phase online consultation to enable individual Canadians to participate easily, as well as a public hearing which was held in February 2017. The Commission received comments from 375 parties, including over 350 individual Canadians. The Commission received interventions from Bell Canada; Bragg Communications Incorporated, operating as Eastlink (Eastlink); the Canadian Wireless Telecommunications Association (CWTA); the CCTS; the Coalition (collectively, the Consumers’ Association of Canada, the Council of Senior Citizens Organizations of British Columbia, the National Pensioners Federation, and the Public Interest Advocacy Centre); Comité pour le service cellulaire équitable L’Islet; Community Legal Aid (Windsor, Ontario); the Consumers Council of Canada (CCC); the Deaf Wireless Canada Consultative Committee (DWCC); Dr. Catherine Middleton, Canada Research Chair, Ted Rogers School of Management, Ryerson University and Dr. Tamara Shepherd, Assistant Professor, Department of Communication, Media and Film, University of Calgary (Middleton and Shepherd); the Forum for Research and Policy in Communications (FRPC); Freedom Mobile Inc. (Freedom Mobile) [formerly WIND Mobile Corp.]; Group of students from Huntington University at Laurentian University; Group of researchers from University of Ottawa: Marina Pavlovic, Mary Cavanagh, Sean Grassie and Lora Hamilton (collectively, Pavlovic et al.); Media Access Canada (MAC); Ministère de la Culture et des Communications du Québec et l'Office de la protection du consommateur; Quebecor Media Inc., on behalf of Videotron G.P. (Videotron); Rogers Communications Canada Inc. (RCCI); Saskatchewan Telecommunications (SaskTel); SSi Micro Ltd. (SSi Micro); TELUS Communications Company (TCC); l’Union des consommateurs (l’Union); and Vaxination Informatique (Vaxination). The public record of this proceeding, which closed on 6 March 2017, is available on the Commission's website at www.crtc.gc.ca or by using the file number provided above.

Issues

Based on its review of all comments made during the proceeding, the Commission determines that the following are the key issues to be addressed in this decision: Overall effectiveness of the Code

Evolution of the retail wireless market: new plan types and service offerings Multi-user plans Flex plans Data add-ons and roaming plans Pay-in-advance plans

Application of the Code

Content of the Code – Clarifications and changes Introduction to the Code Application to prepaid and postpaid services Multi-user plans – Consent and application of caps Plain language Unlimited services Postpaid service contracts Critical Information Summary Changes to contracts and related documents Roaming charges Cap on data overage charges Unlocking Trial period Cancellation date Contract extension/device subsidies Disconnection Expiration of prepaid balances Accessibility

Other proposals raised by parties

Awareness of the Code

Implementation

Compliance monitoring and future reviews of the Code

Overall effectiveness of the Code

The purpose of the review is to assess the Code’s effectiveness to date and make adjustments as necessary to ensure its ongoing effectiveness. Parties generally agreed that, as demonstrated by the POR reports and the CCTS reports, the Code has generally been effective in meeting its objectives. For example, the CCC, the Coalition, and the FRPC submitted that the Code has been particularly effective in reducing barriers to switching WSPs by prohibiting WSPs from imposing early cancellation fees after two years. The CCC and the FRPC further noted that the Code has successfully reduced the risk of bill shock by imposing caps on data roaming and overage charges. WSPs and the CWTA submitted that the reduction in wireless complaints is evidence of the Code’s success overall. With respect to complaints, the POR reports show that the percentage of Canadians who reported having made a complaint in the past 12 months has dropped by over a third in the past two years, down from 26% of Canadians in the spring of 2014 to 17% of Canadians in the fall of 2016. Similarly, the CCTS reports show a decline in wireless complaints. Complaints to the CCTS about wireless services dropped since 2012 (60.2% in 2012 versus 50.3% in 2016). However, wireless services continue to generate the most complaints to the CCTS, compared to other services. The POR reports also show that the percentage of Canadians who reported experiencing bill shock has decreased by a quarter since 2014, down from 28% of Canadians in the spring of 2014 to 21% of Canadians in the fall of 2016; Canadians identified data overage fees (48%) and international roaming charges (17%) as the main reasons for bill shock in 2016; and those on multi-user plans (i.e. a shared or family plan), a relatively new and increasingly popular option for consumers, are also more likely to experience bill shock than those on an individual plan (28% versus 19%);

the percentage of Canadians reporting that their switch between WSPs was ‘easy’ has increased from 75% in 2014 to 79% in the spring of 2016; and

fewer Canadians reported having their wireless plans changed without notice, decreasing since 2014 (19% in the spring of 2014 versus 17% in the spring of 2016).

With respect to contract clarity, the CCTS reports show that misleading or unclear contract terms continues to be a source of frustration and complaints for consumers. The POR reports show that Canadians’ understanding of contract language remained relatively stable, with 66% of Canadians reporting that they found their contracts clear and easy to understand (consistent with 2014 and 2015); and the number of Canadians who thought their contracts were unclear and difficult to understand decreased since 2014 (16% in the spring of 2014 versus 14% in the spring of 2016). No party proposed a radical overhaul of the Code. Instead, most parties proposed that the Commission make targeted changes to the wording and/or content of the Code or clarify how existing rules are to apply given (i) new business practices that have emerged since the Code was introduced, and (ii) determinations made in related Commission decisions.

Commission’s analysis and determinations

The Commission considers that the evidence on the record indicates that the Code has made considerable strides towards achieving its objectives. Specifically, since the Code was introduced wireless complaints have decreased;

bill shock has decreased;

unilateral changes to contract terms have decreased; and

ease of switching providers has increased.

However, the evidence on the record of this proceeding also shows areas where the Code’s effectiveness in reaching its objectives could be improved. For example, despite the significant strides the Code has made in protecting consumers against unexpectedly high bills, data overage and roaming charges continue to be a problem for one-in-five Canadians and half of Canadians still find it difficult to manage roaming fees while travelling abroad. Locked phones and unlocking fees were also key consumer concerns expressed by individual Canadians on the record of this proceeding, and were viewed by many as barriers to the advancement of the Code’s objectives. Accordingly, to ensure that the Code continues to be effective, the Commission determines that it is necessary to make certain targeted changes to the Code and to clarify certain existing rules.

Evolution of the retail wireless market: new plan types and service offerings

Since the Code was created, the wireless market has continued to evolve, introducing new types of wireless plans and services. To ensure the Code continues to be effective for all consumers, no matter what type of wireless plan or service they choose, the Code must respond to market changes. When the Code was developed, multi-user plans and flex plans were not offered by most WSPs. As a result, they were neither discussed extensively on the record of that proceeding nor specifically addressed in the original Wireless Code policy.

Multi-user plans

Multi-user plans include family and shared plans. In a multi-user plan, the customer generally chooses a wireless plan with voice, text, and/or data and shares it between family, friends, or devices. Certain multi-user plans enable the customer to add up to nine other users and/or devices. According to the Wireless Code Public Opinion Research 2016 report, there has been a 5% increase in the use of family plans (up from 25% in 2015 to 30% in 2016) at the expense of individual plans (down from 73% in 2015 to 68% in 2016). Footnote 9 Notably, the report also indicates that Canadians with a family or shared plan are more likely to have made a complaint about their wireless services. How the Code applies to multi-user plans was one of the most contentious issues in this proceeding. Key issues related to multi-user plans include who can consent to charges and changes; who should receive usage notifications; and how data caps should be applied to multi-user plans.

Flex plans

In today’s market consumers can purchase data as part of their wireless plan in several ways. Most plans that include data have a set maximum amount of data that can be used before data overage charges begin to apply. In contrast, flex plans provide a tiered approach to using and purchasing data. Such plans usually include a minimum monthly data fee and a series of additional flat fees that customers may pay as they use more data. Many flex plans still enable a customer to incur data overage fees when a customer’s data usage during a billing cycle exceeds the topmost tier in the plan.

Data add-ons and roaming plans

When the Code was developed, data add-ons and roaming plans were neither discussed extensively on the record of that proceeding nor specifically addressed in the original Wireless Code policy. Add-ons are packages of optional services that customers can add to or remove from their monthly plan without changing the plan itself. When the Code was first developed, the most common types of add-ons were long distance, voice mail, and call display. Today, WSPs are offering more extensive add-ons like data top-ups and travel or roaming plans. Generally speaking, data add-ons are data packages that the customer can add to their plan for a single billing cycle, with no commitment beyond that billing cycle and without changing the plan itself. By purchasing a data add-on, instead of being billed at standard data overage rates, the customer buys extra data at a different rate. This provides some predictability for the customer in terms of the total charge they can expect on their bill at the end of the billing cycle. If the customer wants another data add-on next billing cycle, they must actively purchase it again. The customer may continue to incur overage fees at the standard overage fee rate if they exceed the data included in their monthly allotment and the data add-on. Most wireless plans do not include roaming fees as part of the customer’s monthly plan. Travel or roaming plans enable customers to purchase voice, text, and/or data roaming services to use while travelling. In one common roaming plan model, the customer pays a small daily fee to access the equivalent of the amount of data they have in their wireless plan at the same or similar rate as when they are not roaming. Any usage that exceeds the allotted amounts in the customer’s monthly wireless plan are charged at the overage rate applicable to the customer’s plan. In another common model, customers purchase a specific amount of voice, text, and/or data roaming services to use while roaming; the roaming usage limits are unrelated to their monthly usage allowance for these services.

Pay-in-advance plans

In the original Wireless Code policy, the Commission noted that the distinction between prepaid and postpaid services is when the customer pays for the service – in advance or after usage. The Commission considered that postpaid customers required additional protection under the Code since they were subject to overage charges and the services were less transactional in nature. However, the prepaid market has changed since the introduction of the Code. Fewer Canadians are selecting prepaid plans; however, a significant portion of the population (3.6 million Canadians) continues to use prepaid services.

Fewer prepaid plans offered by WSPs resemble the traditional prepaid plan types - prepaid cards or pay-as-you-go plans. The overall percentage of complaints about wireless services are trending down, but the percentage of complaints about prepaid services are trending up; prepaid customers are twice as likely to make a complaint about their wireless service – according to the CCTS, some WSPs are not informing customers about all the conditions and fees that apply to their prepaid services.

The Code’s current distinction between prepaid and postpaid services is based on the fact that, at the time of the original Wireless Code policy, most prepaid customers used prepaid cards or pay-as-you-go plans. Prepaid cards are transactional in nature and do not require the WSP to collect any information about the customer. There is no risk of bill shock with the use of prepaid cards. Similarly, pay-as-you-go plans are entirely paid for by the customer in advance. The customer has to top up their account regularly and is not subject to overage charges. Since the Code came into effect, more WSPs have started offering another type of prepaid plan which will hereafter be referred to as pay-in-advance plans. While the terms and conditions of these plans vary from provider to provider, unlike prepaid cards and pay-as-you-go plans, some of these plans allow the WSP to charge the customer after usage. For example, in some cases, a customer can deplete the prepaid balance in their pay-in-advance account and continue to use the service, incurring overage charges that are billed to the customer the next billing period. These plans are also sometimes offered on a term and with a subsidized device. These plans are therefore functionally very similar to postpaid plans. The only remaining difference is that typically no credit checks or security deposits are required.

Commission’s analysis and determinations

The Commission considers that the changes in the wireless market, notably the changes related to multi-user plans, flex plans, data add-ons, roaming packages, and pay-in-advance plans require clarifications of and changes to the Code. These clarifications and changes are set out in more detail in subsequent sections of this decision.

Application of the Code

How the Code applies to corporate plans

The Code applies to wireless services provided to individual and small business customers in all provinces and territories regardless of the status and business models of the WSP and whether the wireless services are purchased (i) independently from other services or as part of a bundle of services; and (ii) in person, over the phone, or over the Internet. In Telecom Decision 2014-528, Footnote 10 the Commission reiterated that the Wireless Code applies to retail mobile wireless voice and data services provided to individuals and small businesses. This means that it applies to all wireless plans for such services where the contract is between (a) an individual and a WSP, or (b) a small business and a WSP. Further, the Commission clarified that the Wireless Code applies to all contracts between an individual and a WSP where the individual is responsible for some or all charges related to the contract. Parties who commented on the Commission’s intention to reflect any Wireless Code clarification decisions issued since the Code came into effect did not raise any specific issues with regard to the corporate plans clarification.

Commission’s analysis and determinations

To ensure ongoing clarity with respect to the Code’s application, the Commission reiterates that the Wireless Code applies to retail mobile wireless voice and data services provided to individuals and small businesses. This means that it applies to all wireless plans for such services where the contract is between (a) an individual and a WSP, or (b) a small business and a WSP. Further, the Commission reiterates that the Wireless Code applies to all contracts between an individual and a WSP where the individual is responsible for some or all charges related to the contract. The Commission also reiterates that the Wireless Code does not apply to agreements between a WSP and a medium or large business where the individual using the service is not responsible for any of the charges incurred.

The Code’s interaction with provincial legislation

In the original Wireless Code policy, the Commission determined that the Code would apply to all Canadian consumers of wireless services equally, regardless of any consumer protection legislation in force in the provinces or territories. Further, it stated that the Code would take precedence over valid provincial laws in cases of direct conflict. Multiple WSPs, the Coalition, and the CWTA requested that the Commission declare that the Code is the only valid set of rules for wireless consumer contract regulation in Canada. These parties argued that conflict with provincial rules is creating confusion, frustrating the objectives of the Code, and imposing an undue compliance burden on WSPs. TCC argued that provincial consumer protection laws intrude on the core of the federal power to regulate telecommunications. Videotron submitted that it was not ideal, at the operational level, for there to be co-existing provincial and federal rules in the wireless sphere, but that it had been able to navigate the situation thus far. MAC and l’Union argued that the Commission should not make any determination with respect to the constitutionality of provincial laws, since (i) there is little evidence of direct conflict, (ii) doing so may deprive consumers of additional protections, and (iii) a recognition of overlapping jurisdiction in this area would be consistent with Canada’s co-operative federal tradition.

Commission’s analysis and determination

No party provided compelling evidence of serious conflict between the Code and provincial consumer protection laws, or of the Code’s objectives being frustrated by such laws. However, if direct conflict with provincial legislation should arise, the Commission reiterates that, consistent with general constitutional principles of interpretation, the Code takes precedence.

Content of the Code – Clarifications and changes

The following addresses the sections of the Code that parties proposed be changed or clarified. The issues set out below generally follow the order in which they appear in the Code. There are certain sections of the Code that no party suggested be changed. Any sections and provisions of the Code that are not clarified or changed in this decision continue to be interpreted and applied as set out in the original Wireless Code policy. The Wireless Code, as amended by this decision, is set out in Appendix 1 of this decision.

Introduction to the Code

The introduction to the Code explains the Code’s objectives, which sections apply to prepaid or postpaid services, customers’ options for dealing with a problem or complaint, and an interpretive statement indicating that if any part of the Code or the customer’s contract is ambiguous, or if it is unclear how the terms of the Code or the contract are to be applied, then the Code and the contract must be interpreted in a manner that is favourable to the customer. Some parties noted that the Code currently does not have any interpretive clauses built into the Code itself and questioned whether WSPs are respecting the spirit or intention of the Code. The Coalition and l’Union proposed that several interpretive clauses be added to the Code. They considered that this approach would ensure all interested parties, including WSPs and consumers, are aware of how the Code’s requirements should be interpreted and operationalized. Further, l’Union submitted that it would be useful for the CCTS to refer to such clauses when investigating complaints. L’Union submitted that a formal preamble be added to the Code, setting out the following general interpretive principles: the Code and contracts must be interpreted at all times in favour of the consumer;

any waiver by the consumer of his rights under this Code is void, whether contractual or otherwise;

service providers may not, on their own initiative, contractually or otherwise, add to the conditions and exceptions set out in the Code;

service providers cannot assume consumer knowledge: their practices and representations must be adapted to the particular vulnerabilities of consumers; and

any attempt by service providers to circumvent the Code or its principles of interpretation must be interpreted as a Code breach.

The FRPC also submitted that WSPs should be prohibited from requiring customers to waive their rights under the Code. The CCTS cited a specific example of this practice occurring in which two WSPs have drafted their contracts such that consent to receive the permanent copy of the contract and related documents electronically is built directly into the agreement. This practice does not provide the customer with the ability to accept the wireless services agreement without also agreeing to receive their documents electronically, which would appear to result in the customer waiving their right under the Code to choose a paper copy of the contract.

Commission’s analysis and determinations

The Commission considers that the introduction to the Code must be clear and easy to read and understand. Further, the introduction is an appropriate place to explain information related to the application and objectives of the Code. The Commission considers it appropriate to incorporate text into the body of the Code that sets out the fundamental principles that are critical to the interpretation, implementation, and administration of the Code’s provisions. The Code’s introduction includes the following statement: “If any part of the Code or the customer’s contract is ambiguous, or if it is unclear how the terms of the Code or the contract are to be applied, then the Code and the contract must be interpreted in a manner that is favourable to the customer.” The Commission considers that this statement has helped to further the Code’s objectives and should be reflected in the new preamble section of the Code. The Commission therefore determines that it is appropriate to change the Code by moving this statement to a new preamble section of the Code. On the matter of the waiver of a customer’s rights under the Code, it could seriously undermine the Code’s effectiveness if WSPs were permitted to insert such waivers in their form contracts. In the original Wireless Code policy, the Commission noted that “express consent” cannot be obtained through a default provision or by requiring the customer to “opt out.” In an effort to bring even greater clarity to this issue and meet the objectives of the Code, namely establishing consumer-friendly business practices and making it easier for consumers to understand the information in their wireless service contracts, the Commission considers that the Code should explicitly address this issue by including an interpretive clause to that effect in the new preamble section of the Code. The Commission determines that it is appropriate to change the Code by including an interpretive clause to that effect in the new preamble section of the Code. With regard to the proposal that the Code include an interpretive clause to address the particular vulnerabilities of consumers, the Commission notes that the Code is generally intended to afford necessary protections to all consumers, including those with particular vulnerabilities. As an example, certain additional protections are afforded to persons with disabilities. Moreover, such a clause could complicate the application and interpretation of the Code, especially considering that no definition for the concept of vulnerability has been proposed. It could also be a challenge for the CCTS to administer. For these reasons, the Commission considers that it is not appropriate to add this proposed interpretive clause to the Code. With respect to the proposal that the Code include an interpretive clause regarding WSP attempts to circumvent the Code, there are already consequences to a WSP not complying with the Code. The CCTS reports breaches of the Code that arise during complaint investigations in its reports. In most cases, WSPs must compensate customers (WSPs compensated customers in 74% of cases brought before the CCTS in 2016). Footnote 11 WSPs must also pay a fee to the CCTS for every complaint it receives relating to their service. For these reasons, the Commission considers that it is not appropriate to add this proposed interpretive clause to the Code. Nonetheless there is an opportunity to provide further interpretive clarity by explicitly stating that the Code is to be interpreted in a purposive manner. In other words, the provisions of the Code must be understood to further the objectives of the Code. This would be best achieved by reference to the Commission’s analysis and determinations in the original and revised Wireless Code policies. The original Wireless Code policy is already the CCTS’s main source of information to determine what the Commission intended with each obligation and provision of the Code. The Commission therefore determines that it is appropriate to change the Code by including a clause stating that the Code must be interpreted purposively, by reference to the original Wireless Code policy and this policy. In summary, the Commission determines that it is appropriate to change the Code by adding a preamble section at the beginning of the Code that includes the following three interpretive clauses: In interpreting the Code, if any part of the Code or a contract for wireless services is ambiguous, or if it is unclear how the terms of the Code or the contract are to be applied, then the Code and the contract must be interpreted in a manner that is favourable to the customer;

A service provider may not require a customer to waive a right under the Code, contractually or otherwise, in order to receive the service provider’s services; and

The Code and its provisions are to be interpreted purposively, by reference to their objectives. In order to understand the objectives of the Code and any specific provisions of the Code, reference shall be made to Telecom Regulatory Policy 2013-271 and Telecom Regulatory Policy 2017-200.

Application to prepaid and postpaid services

In the original Wireless Code policy, the Commission considered that postpaid customers required additional protection under the Code since they were subject to overage charges and the services were less transactional in nature. As a result, how the Code applies to contracts depends on whether they are prepaid or postpaid. All sections of the Code, with the exception of section J (Expiration of prepaid cards), apply to postpaid services; sections A.1-3 (Clarity); B.2 (Prepaid service contracts); E.1 (International roaming notification), E.4 (Unsolicited wireless services), and E.5 (Mobile premium services); F.1-4 (Mobile device issues); G.1-4 (Early cancellation fees and Trial period); and J (Expiration of prepaid cards) also apply to prepaid services. Some parties questioned whether some or all of the Code’s postpaid protections should be extended to apply to customers of prepaid services, particularly in light of how some prepaid plans have changed. Service providers were generally opposed to changing how the Code applied to prepaid plans. In contrast, consumer groups generally considered that consumers deserve equal protection and information, irrespective of what type of contract they choose. Parties further discussed how changes to the prepaid business models may impact the effectiveness of the Code for prepaid customers. The CCTS submitted there are many types of prepaid plans now available and some of these are so similar to postpaid plans that they are practically indistinguishable. In particular, the customer’s experience when subscribing to prepaid plans that bill at regular intervals based on pre-established usage thresholds are essentially the same as that of a postpaid customer. Bell Canada, Eastlink, Freedom Mobile, RCCI, SaskTel, and TCC submitted that they offer such pay-in-advance plans. Freedom Mobile noted that this is the only type of prepaid plan that it currently offers. Freedom Mobile argued that these plans are still different from postpaid plans in that there are no credit checks or security deposits; personal identification is not required; there are no tab accounts; there are no commitment terms; customers always pre-pay and re-commit for one month of plan usage at a time; there are no cancellation fees; and no monthly bills are provided (but customers can monitor usage and payment history through their online account). Bell Canada, Eastlink, RCCI, SaskTel, and TCC submitted that they still offer pay-as-you-go prepaid plans, in which a prepaid balance is drawn down on a pay-per-use basis; Eastlink, SaskTel, and TCC noted that they still offer prepaid cards. Some WSPs stated that increased obligations under the Code for some or all prepaid services could increase costs for WSPs and customers and lead WSPs to stop offering such plans. Parties disagreed on whether prepaid customers should receive a Critical Information Summary (CIS). The Coalition submitted that prepaid subscribers should receive a CIS. Eastlink, Freedom Mobile, and SaskTel noted that they currently offer a CIS to prepaid users even though they are not required to. RCCI and TCC opposed providing a CIS to prepaid users. RCCI submitted that it would be impractical, regardless of the duration of the service, to mandate a requirement to provide a CIS for prepaid services. TCC submitted that including a CIS runs contrary to the spirit of prepaid services, namely that they are meant to be easy and convenient for consumers to obtain, with a reduced contractual burden. Parties also noted that prepaid customers currently do not have key contract terms, and, as a result, WSPs can change any term of a contract even during long-term contracts where the customer may be locked in by an early cancellation fee (ECF). In light of the evolution of the prepaid business model, the CCTS suggested that prepaid customers with a pay-in-advance plan valid for up to one year should have key contract terms that cannot be changed. The Coalition supported this view. The CWTA stated that key differences between customers with prepaid services and those with postpaid services are that prepaid customers are not on term contracts or contracts that automatically extend every 30 days without any action on the customer’s part. RCCI and TCC noted that they offer plans on a multi-month basis through some of their brands, but that no rate changes are instituted during the commitment periods.

Commission’s analysis and determinations

The prepaid market has changed since the Code came into effect, with fewer Canadians selecting prepaid plans as compared to postpaid plans; however, a significant portion of the population continues to use prepaid services. Fewer plans offered by WSPs resemble the traditional concept of prepaid - prepaid balances drawn down on a per-use basis, such as prepaid cards or pay-as-you-go plans. According to the CCTS reports, the overall percentage of complaints about wireless services are trending down, but the percentage of complaints about prepaid services are trending up. Prepaid customers are also twice as likely to make a complaint about their wireless service according to the Wireless Code POR of spring 2016. Footnote 12 The Commission considers that under the original Code, it has been possible for some services to be marketed as prepaid when they are, in fact, functionally very similar to postpaid services. Based on the evidence on the record of this proceeding, the Commission considers that certain pay-in-advance plans are effectively the same as postpaid plans, particularly from the customer’s point of view. Service providers have noted certain differences, including that, with pay-in-advance plans, customers are generally not subject to credit checks or the imposition of a security deposit. However, the Commission considers that these differences are minor and that the plans bear a far greater resemblance to postpaid plans than to other types of prepaid plans, such as prepaid cards or pay-as-you-go plans. Most significantly, some of these pay-in-advance services have similar capacity for bill shock as postpaid services, given the potential for overage charges beyond the prepaid balance, Footnote 13 and customers on such contracts could still be subject to an ECF. Further, as some customers may have contracts with fixed terms of up to one year, some pay-in-advance services are not transactional in nature to the same degree as prepaid cards or pay-as-you-go services. The Commission notes that not all pay-in-advance plans are structured the same way, so it would be difficult to treat all pay-in-advance plans the same under the Code. Accordingly, the Commission determines that it is appropriate to change the Code by extending the full postpaid protections of the Code to any service that may bebilled all or in part after use, and in which overage charges beyond the prepaid balance can be incurred. If a service meets these criteria, it is considered postpaid and is therefore subject to the postpaid sections of the Code irrespective of how it is marketed or described by a WSP.

This will protect customers who are exposed to a higher risk of bill shock compared to more traditional prepaid services.

To reflect this policy change in the Code, the Commission changes the definitions of “prepaid services” and “postpaid services” in the Code as follows: Prepaid services: Wireless services that are purchased in advance of use only, such as the use of prepaid cards and pay-as-you-go services.

Postpaid services: Wireless services that may be billed all or in part after use, for example in a monthly bill, and for which overage charges can be incurred. For greater clarity, any pay-in-advance plan where the service provider may bill the customer for some or all charges after use or where the customer may incur overage charges beyond the prepaid balance is treated as a postpaid plan for the purposes of the Code.

As a result of this change, the sections of the Code that previously only applied to postpaid services, including the requirement to provide a CIS and the rules related to key contract terms, will apply to any plan that meets the definition for postpaid, which will include some pay-in-advance plans. The purpose of this change is to expand the definition of postpaid service. Accordingly, where the postpaid definition currently applies to services for which no overage charges can be incurred because they have been purchased on an unlimited basis, that definition will continue to apply. These changes will help to ensure that all customers are afforded an appropriate level of protection based on the risk of bill shock, regardless of how the plan is marketed by the WSP;

provide the CCTS with clearer guidelines on what is considered a prepaid service or a postpaid service; and

make it easier for a wider range of customers to obtain and understand the information in their contracts and establish further necessary customer-friendly business practices, thereby making these customers better able to make choices in the competitive marketplace.

The Commission further determines that the Code’s rules applicable to prepaid services, including the more flexible information provision requirements of section B.2 of the Code, continue to be appropriate for other types of prepaid services, such as prepaid cards or pay-as-you-go plans, or pay-in-advance plans that do not allow the customer to incur overages beyond the prepaid balance. Customers choosing these types of services remain more insulated from bill shock and are able to walk away with greater ease, and these services remain more transactional in nature.

Multi-user plans – Consent and application of caps

A key issue raised in this proceeding is which users of a multi-user plan can consent to additional charges or changes to the plan. The Code currently requires that WSPs must suspend data overage and data roaming charges once they respectively reach $50 and $100 within a monthly billing cycle, unless the customer expressly consents to pay additional charges. The Code also prohibits a WSP from changing the key contract terms and conditions of a postpaid wireless contract during the commitment period without the customer’s informed and express consent. Many parties also raised the related issue of how the Code’s rules on data overage and data roaming caps should be applied to multi-user plans. Certain WSPs indicated that they apply the caps on a per-device basis, rather than a per-account basis. For example, a WSP applying the caps on a per-device basis would only apply the $50 data overage cap to a plan with five devices when the plan hits $250 in overage fees. Similarly, they would only apply the $100 roaming cap to a plan with five devices when the bill reaches $500 in roaming fees. At issue is whether the Code requires that the caps be applied at the account or the device level. The CCTS stated that it received many complaints from account holders (i.e. the person who pays the bill for the mobile wireless services in question) who claimed that they did not consent to data charges above the $50 cap or roaming charges above the $100 cap. According to the CCTS, these complaints resulted from some WSPs sending a notification to the devices incurring the data roaming charges on a multi-user plan and allowing the device user, who may not be the account holder, to consent to additional charges. Consistent with the principle that ambiguity must be interpreted in favour of the customer, the CCTS has interpreted the Code to mean that only the account holder can consent to additional charges. The CCC, the Coalition, the FRPC, l’Union, Vaxination, and Videotron agreed with the CCTS’s interpretation. Eastlink also agreed, but noted that users with which the account holder has expressly agreed to share this responsibility should be allowed to do so. Canadians who participated also generally agreed with the CCTS’s views and some reported bill shock as account holders of multi-user plans. Bell Canada, the CWTA, RCCI, and TCC opposed the CCTS’s interpretation. They argued that by signing up for a multi-user plan, the account holder is implicitly assuming the responsibility for any additional device user’s action – including minors. WSPs further argued that it is particularly important to small business device users to be able to consent to overage charges. Eastlink, RCCI, TCC, and Videotron noted that they now have features that allow account holders to stop specific device users from being able to consent to overage charges. Vaxination submitted that all WSPs should put such protections in place. With regard to how the caps are applied, the CCTS was of the view that the limit should be $50 in overages for the entire account prior to suspension, not per device connected to the account. Specifically, the CCTS submitted that it has seen complaints about at least one WSP that is not applying the data or roaming cap once the $50 or $100 threshold has been reached. Instead, it calculates the threshold by multiplying this amount by the number of wireless devices activated on the shared plan. The CCTS suggested that the Commission clarify that WSPs are required to suspend data overage charges at $50 per monthly billing cycle and data roaming charges at $100 per monthly billing cycle and that these thresholds are to be applied per account, not per device activated on the account. The Coalition and the FRPC agreed with the CCTS’s position. WSPs generally disagreed, noting that they generally do not apply the cap at the account level for multi-user plans. TCC argued that doing otherwise may see the cap reached too quickly, for example for small business customers. WSPs reported two different approaches to applying the caps either by (a) applying the cap to each individual device when that device reaches the Code-established cap in overage fees, or (b) by multiplying the Code-established cap by the number of devices and applying the cap when that amount is reached for the account. The FRPC submitted that, for consistency, under sections E.1 (International roaming notification), E.4 (Unsolicited wireless services), and E.5 (Mobile premium services) of the Code, both the account holder and the device user should be notified when a device on a multi-user plan is roaming in another country, and that only account holders should be able to consent to additional charges related to unsolicited wireless services and mobile premium services.

Commission’s analysis and determinations

The Commission considers that the key issue to be resolved is who constitutes “the customer” when interpreting the Code in the context of multi-user contracts – the device user and/or the account holder for the purposes of consenting to changes and additional charges. The Code should be interpreted as offering a consistent approach with regard to who can consent to additional charges, who can consent to WSP-initiated changes to contracts and related documents, and who should receive notifications. In general, consumer-friendly practices are those that ensure that the account holder, as payor of the bill, remains informed and in control of the account at all times, as a means of limiting the potential for bill shock. The consent models currently used by some WSPs expose account holders to significant bill shock, an issue further evidenced by the complaints on the record of this proceeding. The Commission further notes that the CCTS already interprets the Code to ensure that account holders of multi-user plans are as protected by the Code as customers with individual plans. The Commission considers that the CCTS’s interpretation of who can consent to overage charges is consistent with the Code’s objectives and with the general interpretive guidance set out in the Code. Accordingly, the Commission clarifies that only the account holder, or a user authorized by the account holder (an authorized user), may consent to additional data overage charges or data roaming charges beyond the cap. The approaches to the overage caps used by some WSPs also expose customers to significant bill shock by calculating the cap based on the number of devices in a multi-user plan. The Code does not provide that this cap applies per device. Multiplying the cap by the number of devices before suspending charges greatly diminishes the customer protection of the Code. To the extent that the Code is ambiguous in this regard, the Commission considers that the CCTS’s interpretation is consistent with the Code’s objectives and with the general interpretive guidance set out in the Code, as it resolves this ambiguity in favour of the customer by limiting the risk of bill shock. The Commission therefore clarifies that the cap on data roaming charges (section E.2 of the Code) and the cap on data overage charges (section E.3 of the Code) is reached when the account incurs a combined $100 in data roaming charges or $50 in data overage charges. Further, the Commission clarifies that account holders, being ultimately responsible for paying the bill, must by default hold the sole power to consent to additional data overage or data roaming charges beyond the cap. WSPs may allow account holders to alter the default rule and designate additional device users on the account as authorized users who are thus able to consent to additional charges beyond the cap and subsequently allow the account holder to rescind that designation; however, WSPs must ensure that any designations by account holders are done in an informed and express manner. The Commission reminds WSPs that in cases of complaints, the onus is on them to establish that designations were made in an informed and express manner. The Commission considers that WSPs may implement various approaches to seeking consent, as long as they respect the determinations above. The Commission also expects that WSPs will ensure that all device users of a multi-user plan are notified when the data roaming cap or the data overage cap has been reached, unless the account holder has specified otherwise. The Commission further clarifies that only the account holder or an authorized user can consent to changes to key contract terms (section D.1 of the Code) and the account holder must be notified of changes to other contract terms and conditions or related documents (section D.2 of the Code). Similarly, the Commission clarifies that only the account holder, or an authorized user, may consent to charges related to unsolicited wireless services (section E.4 of the Code), and that the account holder, in addition to the roaming device user, should be notified when a device is roaming in another country (section E.1 of the Code). In order to ensure that these clarifications are reflected in the Code itself going forward, the way in which a customer is defined should explicitly reflect the reality of multi-user plans. This is particularly important for provisions of the Code relating to notifications (sections D.2 and E.1), express consent to incur additional charges or purchase additional services (sections E.2, E.3, and E.4), and express consent to a change to a key contract term (section D.1). This will further help to address the concerns related to how the Code rules, especially those related to notifications, data caps, and customers consenting to changes to their plans or services, apply to multi-user plans. Accordingly, the Commission determines that it is appropriate to reflect these clarifications in the Code by changing the definition of “customers” and by adding the new definitions for account holder, device user, and authorized user and using them as appropriate. The definitions for these terms are now as follows: Account holder: A person who is responsible for payment under a contract. Authorized user: A device user who has been authorized by the account holder to consent to additional charges on the account or changes to key contract terms and conditions. Customers: Individuals or small businesses subscribing to wireless services, including account holders, device users, and authorized users. Device user: A person who uses a device associated with a contract, including authorized users.

Plain language

The Wireless Code requires WSPs to communicate with customers using plain language and to ensure that written contracts and related documents present information in a way that is clear and easy for customers to read and understand, including using an easy-to-read font. Individual consumers, consumer groups, and WSPs submitted that clarity and plain language continue to be important. Pavlovic et al. and the CCTS submitted that, to respond to an increasingly information-saturated marketplace, the Code must address how and when WSPs provide information to customers. The CCTS, the Coalition, and l’Union submitted that the Commission should provide detailed guidance as to how to interpret the plain language section of the Code. In its Annotated Guide, the CCTS sets out the specific questions and criteria used to determine whether a WSP has complied with its obligation to use plain language. The CCTS’s assessment tools reference the Government of Canada’s The Canadian Style language guide, which provides guidance on how to communicate in plain language (written and spoken).

Commission’s analysis and determinations

The Commission considers that clear communication continues to be important and that the increasingly information-saturated wireless marketplace can create challenges for customers in navigating information and making informed decisions about their wireless services. With respect to this provision of the Code, the Commission considers that it would be appropriate to provide some additional guidance with respect to plain language by enunciating specific aspects of this manner of communication, including that WSPs are to provide information to customers in a way that is clear, timely, and accurate. However, it is not necessary to add any guidance beyond this to the Code, given that the CCTS’s Annotated Guideprovides clear, appropriate, and readily available guidance on how to communicate in plain language. In light of the above, the Commission determines that it is appropriate to change the Code to require WSPs to communicate with customers in not only plain language, but also in a way that is clear, timely, and accurate.

Unlimited services

The Code prohibits WSPs from charging customers any overage charge for services purchased on an unlimited basis. It also requires WSPs to clearly explain any limits associated with such plans in their fair use policy. The FRPC and l’Union submitted that the Code should only use the term “unlimited” when no limits are placed on a service and when no overage fees are ever imposed on a service. The FRPC submitted that, despite the fact that the Code already prohibits WSPs from charging any overages for services purchased on an unlimited basis, some WSPs have, nevertheless, charged overages for unlimited plans after explaining the overage fees in their fair use policy. In contrast, Vaxination stated that the definition of “unlimited” does not need to be modified. Vaxination was of the view that consumers need to be further educated on what exactly “unlimited services” means and what to look for in the details of wireless contracts. Bell Canada indicated that there are no usage limitations on its unlimited plans but supported disclosure of limits on the use of an unlimited service. However, in response to a question as to whether such disclosure should be included in the CIS, Bell Canada cautioned that it may not be practical to include additional information in the CIS given space restrictions. RCCI and TCC had similar concerns about adding to the length of the CIS.

Commission’s analysis and determinations

The Code requires that any limits to a service that is purchased on an unlimited basis needs to be clearly stated in the fair use policy so that the customer realizes the consequences when the limit on their plan is reached. The Commission considers that having additional clarity at the point of sale on what limits a WSP imposes on unlimited plans, such as a reduction in data speed after a pre-determined amount of data is consumed, would benefit customers and contribute to the Code’s objective of making it easier for customers to understand their wireless contracts. The Commission considers that the CIS is the most appropriate place to highlight this information since it will help customers to quickly understand a fundamental aspect of their unlimited plan. The Commission notes that the CIS may be up to two pages long and considers that this provides sufficient space to include all information required in the CIS. The Commission determines that it is appropriate to change the Code to require WSPs to ensure that the CIS contains a description of any limits imposed on services purchased on an unlimited basis. The Commission reiterates that WSPs are not permitted to apply overage charges for any plan purchased as unlimited under any circumstances, and that disclosure of such overages does not render that requirement moot.

Postpaid service contracts

The Code ensures that postpaid customers receive a permanent copy of their contracts and related documents and explains what information must be included in these documents.

Format of the contract

Bell Canada, the CWTA, Freedom Mobile, RCCI, TCC, and Videotron argued that, while the Code allows for a permanent copy of the contract to be electronic, the Commission should, as it did in the Television Service Provider (TVSP) Code, Footnote 14 determine that “it would not be appropriate to mandate that the permanent copy of the agreement be in paper format” as part of this review. Some WSPs argued that the default method for delivery should be electronic, while others have suggested that each WSP should be permitted to decide. Vaxination submitted that customers should be explicitly asked to choose which format they prefer. L’Union and Videotron supported the view that customers should ultimately decide. The Coalition also supported this view, but added that customers who opt for paper or alternative formats should receive them free of charge. The CCTS noted that during the course of its investigations it had noticed that, while some clients had agreed to receive a permanent copy of their contracts and related documents in electronic format, the electronic copy provided was not an inalterable one. The CCTS noted that some WSPs send customers a link to their website to consult the related documents. The CCTS requested that the Commission clarify whether that is acceptable; the CCTS suggested that it should not be given the importance of these documents. Vaxination submitted that the permanent copy must reside with the customer, and not on the WSP’s infrastructure. The FRPC argued that, as there are no limits to contract length, all terms and conditions to a contract should be included in the contract itself, and not relegated to the WSPs’ websites. The CCTS submitted that it has noticed that some contracts appear to not offer an option for the customer to agree to the contract without also agreeing to receive the permanent copy of their contract and related documents electronically. The CCTS requested that the Commission clarify whether that is acceptable.

Commission’s analysis and determinations

In the TVSP Code, the Commission determined that a TVSP must “provide a customer with a permanent copy of the agreement in the format of the customer’s choosing (electronic or paper) upon request at no charge, at any time during the commitment period.” The Commission also defined “permanent copy” in the TVSP Code as “[a]n inalterable copy (e.g. a paper copy or PDF Footnote 15 version) of the agreement that is free of hyperlinks that can be changed by TVSPs, as of the date of signing or the date of the latest amendment.” The Commission considers that customers should actively choose what format the permanent copy of their contract should be in (electronic or paper), and that it continue to be provided at no charge, regardless of the format they choose. In addition to being consistent with the Commission’s approach in the TVSP Code, it would also be consistent with the Wireless Code objective that customers be able to obtain and understand information more easily. Accordingly, the Commission changes the Code so that WSPs must provide a permanent copy of the contract in the format of the customer’s choosing (electronic or paper) upon request at no charge at any time during the commitment period and amend the definition of “permanent copy” to incorporate the notion that it must be an inalterable copy of the contract that is free of hyperlinks that can be changed by the WSP. When verifying the Code compliance of WSPs as part of the follow-up to the Telecom Regulatory Policy 2013-271 proceeding, the Commission considered WSPs who required customers to contract-out of their Code rights as part of a standard-form contract not to be implementing the Code as required, as this was inconsistent with the requirement that consent be made in an informed and express manner.

Key contract terms

The CCTS submitted that its interpretation of the Commission’s intentions is that the purpose of identifying “key terms” and “other contract terms” was to distinguish between aspects of wireless services that were critical or vital to most customers (i.e. the service itself) and those aspects that were ancillary, such as privacy policies and one-time costs. It should be made clear and explicit to customers which terms are key contract terms and thus afforded protection from unilateral changes, and that this information should be reflected in the contract and the CIS. The CCTS also noted that some WSPs now appear to be describing the data component of the contract as an “add-on,” and noted that, if this were permissible under the Code, the WSP could unilaterally decrease the customer’s data or increase the rate for data during the contract term. The CCTS reported having received 77 complaints since December 2013 regarding a unilateral change to the data component of service contracts. The CCTS further noted that it has even seen instances where there are no services listed as key contract terms and all the services are characterized by the WSP as “add-ons.” The CCTS noted that this change in business practice has had a considerable impact on consumers and the availability of the rights prescribed to them in section D.1 of the Wireless Code. According to the CCTS, data must be considered a key component of service where it is actually treated by the customer as such. Vaxination submitted that voice, text, and data should be considered key contract terms. L’Union cautioned that being this explicit would not be future proof, both in what customers will value and with regard to other parts of the service that could warrant protection in the future. The Coalition submitted that the minimum monthly charge, usage allowance, and the speed of data should also be key contract terms, and that changes to fair use and privacy policies that affect these should also be considered key contract terms.

Commission’s analysis and determinations

The record of this proceeding clearly demonstrates that there is a disagreement between what some WSPs consider to be key terms and what most customers would consider to be key terms of a contract, particularly with regard to data. The Commission considers that the key issue to be resolved is the appropriate interpretation of the term “key contract terms and conditions” as it is used in the Code. To prevent situations of customers being locked into long-term contracts with significant ECFs, while nonetheless being subject to unilateral increases in the price of key services or decreases in the amount of key services, the Code prohibits key contract terms and conditions from being changed without the customer's consent, whereas optional features can be. In the original Wireless Code policy, the Commission considered that customers needed certainty that the terms and conditions that are integral to the contract will not change without their express consent during the commitment period. The key terms were therefore intended to include the services, other than optional services, that the customer agreed to when they signed up, which, at that time, was usually a mix of calling minutes, text messages, and data (in 2014, 64% of wireless subscribers had a data component to their plan; in 2015 this increased to 74%). Footnote 16 However, these services were not specifically enumerated in the Code as being “key.” While this approach would allow new types of key services to emerge, it may have introduced a degree of ambiguity into the Code. Optional features, as the Code definition of that term makes clear, were intended to capture services like voice mail and caller identification, which customers could buy as extras and add or remove on a month-to-month basis without impacting their minimum monthly fee or changing their underlying wireless plan.‎ Another example of an optional feature is roaming services, which may change from time to time and which customers generally did not sign up for as an integral part of their contract. In keeping with the principle that any potential ambiguity in the Code must be resolved in favour of customers, and consistent with the objectives of the Code more broadly, the Commission clarifies that, at a minimum, the terms upon which voice, text, and data services are provided must be interpreted as being key terms if the customer has agreed to a contract that includes the provision of these services throughout the duration of the commitment term. The fact that a customer has agreed to such a contract is a strong indication that those services, provided in the specified amounts and at the specified rates, are integral to that contract. This interpretation means, among other things, that a customer who signs up for a data plan cannot have that plan changed during their contract term without their consent. Interpreting the term in this way limits the risk of bill shock and ensures that customers are not forced to choose between having to accept unforeseen changes that leave them paying more for service or receiving less service on the one hand, or cancelling a contract that no longer meets their needs while potentially being subject to an ECF on the other hand. As a result of this interpretation, it should not be possible for a contract for wireless services to have no key contract terms, as referenced by the CCTS. While WSPs may offer customers time-limited add-on features or services, it frustrates the achievement of the Code’s objectives if the simple use of the term “add-on” could avoid the Code’s requirements related to key contract terms when services are provided for the duration of the term. In order to ensure that this clarification is reflected in the Code itself going forward, the way in which “key contract terms and conditions” and “optional services” are defined should be changed to reflect the relative importance of specific aspects of the contract to the general customer base. This will further help to address concerns related to how Code rules apply to specific aspects of wireless contracts, especially data plans. Accordingly, the Commission changes the definition of “key contract terms and conditions” to make explicit reference to the services in the contract, “such as voice, text and data services, that the customer agreed to upon entering into the contract and will receive for the duration of the contract.” The definition of “optional services” will also be changed to reflect the clarification that one-time purchases of add-ons that do not continue for the duration of the contract are not key contract terms.

Tab contract and indeterminate contract clarifications

TCC and Vaxination requested that the Commission’s clarification on how the Code applies to tab contracts be incorporated into the Code. No parties commented specifically on the clarification related to indeterminate contracts.

Commission’s analysis and determinations

Parties who commented on this issue had no objection to incorporating any of the follow-up decisions into the Code as part of the review. To reflect the clarification issued in Telecom Regulatory Policy 2013-598, the Commission reiterates that the obligation to provide a permanent copy of the contract, set out in sections B.1(i)(a) and B.1(i)(b) of the Wireless Code, is not engaged upon automatic renewal of a contract. The Commission further determines that the wording of sections B (Contracts and related documents) and C (Critical Information Summary) of the Code should be modified to reflect the clarification issued in Telecom Regulatory Policy 2013-586, specifically that the early cancellation fee does not need to decrease by an equal amount each month, so long as the cancellation fee (i) never exceeds the amount set out in the Wireless Code, (ii) is reduced to $0 in 24 months or less, and (iii) is reduced each month in a way that is clear, transparent, and predictable to a customer.

WSPs must set out in their tab contracts either a) the minimum amount by which the ECF will be reduced each month, or b) the percentage amount that will be used to determine the monthly cancellation fee reduction. Additionally, to ensure clarity, where the ECF is not a fixed dollar amount, WSPs must provide an example of how this fee is calculated in both the contract and the CIS.

When the contract and related documents should be provided

The CCTS noted that the 15 calendar days that WSPs are currently permitted from the date of the contract to send the contract and related documents to the customer may make it difficult for customers to verify whether the written contract reflects their understanding of what was agreed upon. Further, the CCTS submitted that it may make it difficult for a customer to make use of the trial period. The CCTS further noted that related documents, such as privacy and fair use policies, may not always be provided at the same time as the contracts and that, in its view, these documents contain important information. The CCTS argued that it should be ensured that these documents are provided along with the contract in all instances. The Coalition submitted that contracts and related documents should be emailed immediately or mailed within 24 hours in the case of distance contracts, and that any contract that was not signed in person be immediately sent to the customer (by email or by mail) to ensure it arrives well within the trial period. The DWCC, MAC, Middleton and Shepherd argued that electronic contracts should be available almost immediately. L’Union suggested that the time frames for sending these documents, whether in electronic or paper format, should be kept as short as possible. Bell Canada, Eastlink, and SaskTel noted that electronic contracts can be emailed to a customer almost immediately. Videotron noted that it sends electronic copies of its contract within a maximum of five business days. TCC argued that seven days would be a reasonable time frame.

Commission’s analysis and determinations

The Code requires that customers must receive the permanent copy of their contract (a) immediately if agreed to in person or (b) within 15 calendar days if the contract is not agreed to in person (e.g. over the phone or online). Evidence suggests that the timing of the receipt of a contract can be an impediment to customers’ ability to determine whether or not the service and documents match their understanding and expectations and to their ability to use the trial period. When customers cannot benefit from these protections, it frustrates the objectives of the Code. Accordingly, the Commission changes the Code so that where the customer chooses to receive their contract electronically, it must be provided no later than one business day after the agreement was entered into, whether the contract was entered into in person, online, or over the phone. For customers who elect to receive a paper copy of their contract, the existing provision applies and it must be provided within 15 calendar days of the agreement being entered into. However, the Commission expects that reception of the paper copy, if it is beyond this time period, should not prevent a customer from availing themselves of the trial period, and that WSPs should extend the trial period as appropriate in such circumstances.

CIS

In the original Wireless Code policy, the Commission considered that certain elements of a wireless service contract are consistent sources of confusion, and, as a result, are a source of disputes between the customer and the WSP. In light of this, the Commission determined that in addition to the information disclosure requirements for postpaid contracts (section B.1 of the Code), WSPs must provide a CIS of certain especially important information, no longer than two pages, when they provide the permanent copy of a contract to the customer.

Provision of a CIS prior to entering into a contract

The Coalition, the FRPC, Middleton and Shepherd, Pavlovic et al., and l’Union submitted that a CIS should be available upon request during the pre-purchase stages and should act as a firm offer from the WSP, and therefore be usable as a comparative shopping tool. WSPs opposed the proposal, submitting that they offer information on available plans and promotions to consumers online and in-store.

Commission’s analysis and determinations

During the hearing for the original Wireless Code policy, the Commission considered a similar proposal. It determined, however, that requiring WSPs to provide a CIS before a contract has been entered into would involve a significant burden, from both a financial and a resource perspective. The Commission considers that parties in this proceeding have not provided evidence that circumstances have changed sufficiently since the Code came into effect such that the benefit of providing consumers with a CIS during the pre-purchasing stage would outweigh the burden on WSPs. Although the information contained in a CIS would be a useful resource for consumers to compare products and services offered by WSPs, the way in which a WSP chooses to promote its services can be considered a point of competitive differentiation. The Commission therefore considers that WSPs should not be required to provide the CIS, upon request, prior to the customer entering into an agreement. The Commission notes that there are comparison-shopping tools available to wireless customers. These are readily found, for instance, online, and the Commission encourages consumers to utilize these tools when shopping for wireless services. Links to some of these tools can be accessed through the Commission’s website.

CIS as a summary of key elements of the contract

The CCTS submitted that it has found that some WSPs are not using the CIS as a summary of key elements of the service contract, as directed in the Wireless Code, and rather are blending the CIS into the contract, or using it as a contract in itself. It requested that the Commission clarify that the CIS, a summary of key elements that accurately reflects the content of the contract, is to be given to customers in addition to a contract. In this regard, the Coalition submitted that the use of the CIS in this way undermines the basic purpose of the CIS as an aid to consumer comprehension which would enable customers to better understand their wireless contract, even if not provided separately. TCC argued that it was consistent with the Wireless Code for WSPs to design their agreement such that terms and conditions described in the CIS not be replicated or described elsewhere in the contract materials.

Commission’s analysis and determinations

The Commission determined in the original Wireless Code policy that WSPs should have the flexibility to determine whether the CIS will either be a separate document from the written contract or included prominently on the first two pages of the written contract. However, in the wording of the Code itself, the CIS is described as a document that summarizes the most important elements of the contract. It does not follow from this that the CIS may replace the contract itself, either in whole or in part. Accordingly, the Commission clarifies that the CIS is an independent summary of the most important elements of the contract, whether it is provided as a separate document or as the first pages of the written contract, and that information provided in the CIS does not replace or fulfill any requirements to provide the same or similar information within the actual written contract. This interpretation resolves any potential ambiguity in the Code in favour of customers, and is more consistent with the objectives of the Code. In the TVSP Code policy, the Commission determined that information provided in the CIS does not replace or fulfill any requirement to provide the same or similar information within the written agreement. The insertion of language similar to that used in the TVSP Code will help make this point clearer. As a result, the Commission changes the wording of the Code in order to reflect this clarification, by explicitly stating that the provision of information in the CIS does not replace or fulfill any Code requirement to provide the same or similar information in the actual written contract.

Changes to contracts and related documents

The Code prohibits WSPs from changing a key contract term of a postpaid wireless service during the commitment period without the customer’s informed and express consent, unless the change clearly benefits the customer by either reducing the rate for the service or increasing the usage allowance for a single service. The customer may refuse a change to a key contract term. For changes to other contract terms and conditions, the WSP must provide 30 calendar days’ notice before making the change. Bell Canada submitted that, if the Commission determines that data is a key contract term, customers could be liable for ECFs should they request to change the data portion of the plan during their term. Footnote 17

Commission’s analysis and determinations

The Commission considers that Bell Canada’s position appears to be based on an interpretation of the Code whereby a change to a key contract term initiated by either party would constitute the end of the agreement as it was originally agreed upon and the start of a new agreement replacing it. The Code does not expressly address customer-initiated changes to key contract terms. The framework provided in section D of the Code is concerned with WSP-initiated changes to a contract only. The Commission considers that the protections put in place in the Code do not prevent customers from seeking to change a key contract term to better reflect their needs and that such a change would not necessarily constitute an occasion where an ECF can be assessed (as outlined in the Code). Moreover, the Code expressly provides that WSP-initiated changes to key contract terms that clearly benefit the customer are permitted. As such, the Commission clarifies that the provisions of the Code regarding changes to contract terms apply to WSP-initiated changes only and that a customer-initiated request to change a key term of their contract, such as to (a) reduce the rate for a service or (b) increase their allowance for that service, does not constitute a situation in which the ECF may be triggered, should the WSP accept the requested change.

Roaming charges

The Code requires a WSP to suspend national and international data roaming charges once they reach $100 within a single monthly billing cycle, unless the WSP obtains express consent from the customer to pay additional charges.

Voice roaming cap

The CCTS indicated that, in 2015-2016, customers raised issues regarding roaming charges 215 times and that 71% of these pertained to voice roaming charges. Many customers complained that they were not aware that data roaming plans did not cover voice roaming and were surprised to receive a bill for these calls. The CCTS acknowledged there may be technical challenges to implementing a voice roaming cap, but suggested that in the absence of a requirement in the Code, the Commission may wish to consider whether better disclosure to customers of their potential exposure to voice roaming charges may be appropriate. L’Union put forward several suggestions for dealing with voice roaming, including placing a cap on voice roaming, waiving the charges for the first incidence of voice roaming bill shock, requiring WSPs to enable customers to block voice roaming, and requiring that customers receive voice notification of voice roaming charges prior to connecting the call. WSPs indicated that, unlike data, they do not receive voice roaming information in real time from their international roaming partners (of which WSPs can have several hundred) – it typically takes one to three days, and in some instances it can take up to 30 days, to receive call records. As such, there is a technical barrier to capping voice roaming charges that makes it nearly impossible to implement. WSPs submitted that consumers have the option of purchasing a roaming package to have unlimited voice for a fixed price while abroad, to provide protection against bill shock and that customers also receive notifications when they enter a foreign country, in accordance with the Code. Freedom Mobile suggested that the Commission send a signal in the decision that WSPs are to make good-faith efforts to do real-time monitoring and notification for voice roaming and note that exceptions would be permitted where foreign partners do not or cannot participate. The Coalition submitted that a voice roaming cap is needed and that to address the technical challenges the matter could be investigated and reported to the Commission by the CRTC Interconnection Steering Committee (CISC).

Commission’s analysis and determinations

The Commission determined in the original Wireless Code policy that it was not necessary to cap voice service charges since the use of those services are generally well understood and easily managed by customers. Further, the Code also requires WSPs to clearly set out the services included in the contract and any limits on the use of those services that could trigger overage charges or additional fees in both the contract and the CIS. Finally, the Code requires that customers be notified when their device is roaming in another country and this notification must clearly explain the rates for voice services. The Commission notes that customers have a number of ways to manage their bills with respect to voice roaming. For instance, WSPs offer various roaming packages that include a certain allotment of voice, text, and data (including options for unlimited voice minutes while roaming to certain countries). Customers can also track voice minutes on a device, which is far simpler to track accurately than data consumption. The technical challenges of imposing a voice roaming cap are considerable, given the hundreds of roaming arrangements each WSP has around the world. The costs and resource implications that would be placed on WSPs to implement a voice roaming cap are not justified under the circumstances. In light of the above, the Commission determines that a voice roaming cap should not be imposed at this time. The Commission further considers that the clarification of section E.1 of the Code set out in this decision, which also requires WSPs to notify the account holder when they are roaming in another country, will help to avoid the potential for any bill shock associated with voice roaming charges on multi-user plans.

Application of the cap on data roaming charges to data roaming plans

Several WSPs argued that for those customers that have selected add-on roaming packages that feature unlimited roaming for a fixed price per day (e.g. unlimited text and picture messaging for $10 per day for one month), the $100 data cap for roaming charges should not apply. TCC argued that roaming add-ons should not count towards the $100 cap, since it is unnecessary to combat bill shock. Bell Canada argued that the alternative to roaming add-ons would be to revert to pay-per-use data roaming which was likely the cause of data roaming bill shock in the first place. Roaming add-ons are deliberately added by customers for their future travel and provide a measure of control over spending, thereby preventing bill shock. Vaxination stated that clarity is needed with respect to those WSPs that offer fixed daily fees when roaming (as part of an add-on roaming package), and whether those fees count towards the $100 data roaming cap.

Commission’s analysis and determinations

The purpose of the data roaming cap is to help customers avoid bill shock and better manage their roaming fees. The Commission considers that the key issue here is the how the data roaming cap is to be interpreted to apply to roaming packages. As the Commission noted in the original Wireless Code policy, customers generally find it difficult and unintuitive to estimate how much data they are using or how much the data will cost – especially given the differences in cost of data in the customer’s home region and the cost of data while travelling. The evidence in this proceeding does not establish that customers’ understanding has substantially improved in this regard. Some roaming packages offered by WSPs allow customers to use their domestic plan’s voice, text, and data allotments while travelling, for a fixed price per day. WSPs indicated that customers can be subject to overage fees if they exceed their domestic plan’s allotments. Other roaming packages allow customers to purchase buckets of voice, text, and data; if customers exceed the allotments in these buckets, they have the option to purchase more. While roaming packages are a tool that may help consumers manage their roaming fees in certain circumstances, they do not represent a solution to bill shock, as it is still possible for customers to exceed the limits of these packages. The Commission considers that since the introduction of the roaming cap, WSPs have been able to fashion various roaming packages and data roaming add-ons to fit a variety of customers’ roaming needs. This suggests that the roaming cap has not hindered or impaired WSPs’ ability to develop new roaming offerings. In fact, the reduction in the number of complaints to the CCTS concerning international data roaming suggests that the cap, as presently constituted, has been successful in preventing bill shock. However, if the cap was interpreted as not applying in the case of customers who have purchased roaming packages, there is a serious risk that the provision would not achieve its purpose. The Commission therefore clarifies that the Code’s data roaming cap applies to roaming packages as follows: any amount that the customer pays in data roaming fees, whether via a package (before use) or via overage fees (after use), counts toward the cap. WSPs must suspend service when the customer reaches $100 in overage fees during a billing cycle, unless the customer expressly consents to additional charges. Further, it is appropriate to reflect these clarifications by changing the Code to include the term “roaming add-on,” defined to mean roaming packages that the customer can add to their plan for a single billing cycle, with no commitment beyond that billing cycle and without changing the plan itself, and using this term in the Code provision imposing the cap on data roaming charges. This will further help to address concerns related to how Code rules apply to roaming packages.

Cap on data overage charges

The Code requires WSPs to suspend data overage charges once they reach $50 in a single monthly billing cycle, unless they obtain express consent from the customer to pay additional charges.

Amount of the cap

A number of individuals suggested that the cap be reduced from $50 to $0 so that data services are suspended before any overage charges can be incurred. WSPs all argued that the current $50 cap was reasonable. The Coalition concurred with that specific assessment while other consumer groups did not generally oppose keeping the cap at $50, but had concerns as to how it was being applied in some cases. TCC, in particular, noted that its sub-brand, Koodo Mobile (Koodo), already offers a functional cap at $0. Eastlink also offers a similar service. Freedom Mobile noted that while it throttles Footnote 18 speed once the cap is reached, it does not charge overages.

Commission’s analysis and determinations

The Commission notes that there is evidence of innovation on the part of some WSPs to try to better serve their customers in avoiding bill shock related to data overages. TCC’s sub-brand Koodo caps overages at $0 before seeking consent, Eastlink does in some instances as well, and Freedom Mobile does not charge overages, but rather throttles speeds when a pre-set data limit is reached. The Code itself does not dictate the means through which the $50 cap is to be implemented, just that charges be suspended once they reach that amount unless the customer explicitly and knowingly agrees to pay additional charges. WSPs that do charge overages have all adopted an approach through which they suspend any data charges when the cap is reached, sending a notification to their customers that they must agree to further charges should they want data service to be restored for this billing cycle. Most parties considered that the amount of the cap ($50) should not be changed. Further, WSPs have notification practices above and beyond what is required in the Code. In light of the above, the Commission determines that the amount of the cap should not be changed at this time.

Requiring notifications about usage

While the Code requires WSPs to obtain express consent to go beyond the data overage cap, it does not set out explicit requirements for the WSP to notify the customer about data usage before overages are incurred or when the data cap is reached. The CCC and the Coalition argued that the Commission should require the WSPs to offer customers the ability to customize their data overage cap alerts based on their preferences (e.g. when they reach 100% of their monthly data allotment; at $25 in data overage charges). The CCTS was not opposed to this suggestion, but noted that WSPs should clearly be required to explain this process to customers, along with the implications of changing the default thresholds put in place by the WSPs. WSPs and the CWTA generally opposed mandatory notification, with WSPs submitting that they already send notices about data usage and the data cap, despite such notifications not currently being required by the Code. WSPs generally submitted that they notify customers at least once before they reach 100% of their data allotment for the billing period, and again once they reach that data limit. WSPs noted that their implementation of the data cap provisions of the Code are generally implemented through notices sent by text to the device that has incurred an overage seeking consent to further overage charges. L’Union noted its concern that the Code does not require the disclosure of how overage charges accrue and that this can lead to significant bill shock. WSPs generally noted that they offer web-based and app-based solutions for customers to monitor their usage and that, in most instances, the data in those solutions is presented in real time. Exceptions include situations where monitoring depends on intercarrier information or customers subscribe to legacy plans.

Commission’s analysis and determinations

The Commission notes that WSPs are sending notifications at various intervals prior to any overage charges being incurred, before the $50 cap is reached, and even beyond the $50 cap. WSPs are therefore already providing more usage notifications than what is required by the Code, to the benefit of customers. The Commission therefore considers that the Code does not need to prescribe how often WSPs notify customers of the state of their data usage and data overages. This is largely a competitive issue and the market has implemented appropriate solutions. The Commission encourages WSPs to continue to notify customers in advance of their data-usage allotments being depleted to support customers in managing their data usage and preventing bill shock.

Application of the cap to flex plans and data add-ons

The CCTS, Middleton and Shepherd, and l’Union requested that the interaction between flex plans and the cap be clarified. The CCTS noted that for certain flex plans built with a “ceiling,” that is a maximum monthly charge, protections are built in, but that bill shock can be unlimited for flex plans without ceilings. Middleton and Shepherd suggested that WSPs should be required to obtain consent to move the customer into each progressive tier of the flex plan. L’Union argued that the standard determined by the Code, that consent for additional charges be sought once the customer has incurred $50 in charges over and above their regular monthly charges for data, should be applied. However, it noted that this interpretation would not require that notices be sent at every step of a flex plan. The Coalition argued that moving to a higher tier should be considered an overage. The Coalition further argued that subscribing to a flex plan does not imply explicit consent to unlimited charges. Videotron disagreed with the proposal that the $50 cap remain in effect for flex plans, arguing that this would impede innovation in the creation of plans that customers want. Bell Canada and TCC shared that view. With regard to data add-ons, the CCC and the Coalition argued that add-ons should be counted as part of the cap. In contrast, the DWCC, Middleton and Shepherd, and l’Union submitted that these add-ons, if expressly agreed to, should not be counted as part of the cap. WSPs generally considered that add-ons should not be considered as part of the cap. The Coalition, the FRPC, MAC, Middleton and Shepherd, and l’Union all submitted that the explicit agreement to purchase an add-on does not imply explicit consent to any charges above the $50 cap, beyond the amount of that specific add-on.

Commission’s analysis and determinations

The Code’s $50 cap was designed so that users must explicitly consent to charges over and above those that they expected, and $50 was determined to be a reasonable amount to trigger this decision point. The cap provides consumers with greater control over their monthly spending and helps to prevent bill shock; however, there is an issue as to how this cap applies to flex plans and data add-ons. Flex plans can provide customers with a predictable scale of data-related expenses, where the monthly assessed fee is based on the level of data use that the customer reached during the billing period. However, many flex plans still enable a customer to incur overage fees once a customer goes beyond the topmost step in the flex plan. The Commission considers that, to achieve its purpose, the $50 cap must be interpreted as already applying to all postpaid data services, regardless of how the plan in question is structured or marketed, given that customers subscribing to these services may face bill shock. The Commission considers that creating an exception for the application of the data cap to plans labelled a certain way would not be a sustainable approach, and could lead to uncertainty, especially given that the nature of such plans may change over time at the WSPs’ discretion. While some flex plans, as they currently exist, do provide an ultimate ceiling for overages, this is not necessarily true for all such plans. Further, having an eventual ceiling only partially mitigates bill shock, rather than preventing it. The Commission considers that interpreting the calculation of the data overage cap to begin after the first tier or base level of a flex plan is exceeded ensures a similar level of protection from bill shock for flex plan customers as compared to customers of more traditional data plans. Accordingly, this interpretation resolves any ambiguity in favour of customers and furthers Code objectives by ensuring all customers have a similar level of control over their bills. The Commission therefore clarifies that the $50 overage cap applies to flex plans as follows: the customer begins incurring overage fees after the first tier or base level of data is exceeded, and the WSP must suspend data service when they reach an additional $50 in overage fees, unless the account holder or authorized user expressly consents to additional charges. The Commission also encourages WSPs offering flex plans to notify customers as they reach each tier or level of spending. With regards to data add-ons, the Commission notes that customers who purchase a one-time data add-on for the month generally either already exceeded, or are about to exceed, their monthly data allotment; the add-on is therefore a kind of data overage for most customers, since these customers will, in most cases, have already exceeded their monthly usage allotment. Accordingly, the Commission considers that the price of the data add-on purchased by the customer must contribute to the calculation of the $50 cap. Some WSPs noted that they require customers to both consent to purchasing an add-on as well as to override their $50 cap due in a single transaction. The Commission considers that agreeing to purchase a data add-on before the $50 cap is reached does not override the requirement for WSPs to obtain a separate consent to incur further additional charges once the $50 cap is reached. This interpretation resolves potential ambiguity in favour of the customer and furthers the Code’s objectives by giving a customer more information and autonomy of choice. The Commission clarifies that the price of the data add-on should be included in the calcula