Virgin Media should not be charging customers exit fees of up to £240, regulator Ofcom has said – but it’s yet to order the company to change its ways.
In an interim ruling, the regulator says Virgin Media's exit fees - sometimes running into hundreds of pounds - are too high and also has conditions and policies in place which put people off switching – a breach of the rules.
However, Ofcom won’t reach its full decision until the end of the summer, meaning there’s nothing consumers can do right now to avoid the fees – or if past customers can claim them back.
These early termination fees are even still charged if a customer moves to an area where they can’t get the service - which is about half of the UK - although those moving who can, and choose, to keep the same service no longer need to recontract.
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What has Ofcom decided?
Following complaints received from consumers, Ofcom launched the probe last June into whether Virgin Media's early termination fees are fair. Ofcom is yet to fully confirm the outcome of the investigation, but its initial findings reveal Virgin Media has breached rules set by the regulator that all communications providers must follow to operate in the UK.
It has so far deemed that Virgin Media is at fault by:
- Charging exit fees which are too high - it currently charges customers up to £240 when they exit their contract early
- Having conditions and procedures for ending a contract which put customers off from switching
- Making customers who move house during a contract commit to a new term to keep its services - Virgin has since changed its policy so customers moving house will no longer have to re-contract, providing you keep the same services
- Failing to publish on its website clear and up-to-date information about its exit fees - See Virgin's terms here.
Despite the findings, Virgin Media continues to charge customers up to £240 when they exit their contract early, even if they're forced to because they're moving home to an area where Virgin Media's phone, broadband and TV services aren't available. It's the only major provider to penalise customers for this reason. Ofcom is still investigating whether this is deemed fair and is yet to publish any findings - which it claims it will do by the end of summer.
If Ofcom finds that Virgin Media has acted unfairly it could force the company to change its T&Cs, and former customers may be able to claim back exit fees as the Consumer Rights Act states an unfair term of a consumer contract is not binding.
What does Virgin Media say?
A Virgin Media spokesperson said: “We have received Ofcom’s provisional findings and we will now review them thoroughly.
“We make it clear to customers that early disconnection fees can apply and we also offer 30-day rolling contracts for those that do not want to sign up for a minimum period, such as 12 months, and need more flexibility.”