The Broadcast Committee of Advertising Practice (“BCAP”) and Committee of Advertising Practice (“CAP”) have published updated guidance on the presentation of mid-contract price increases in telecoms advertisements.

The guidance follows the announcement from Ofcom earlier this year that telecoms and pay TV providers will be banned from including inflation-linked or percentage-based price rises in new contracts from next month (on which we commented here). Instead, as the new guidance makes clear, providers will now be expected to “set out at the point of sale what the changed monthly price of a contract will be, if it is to change during the commitment period, and from when the changed price will apply, in pounds and pence”.

The Guidance explains that providers will be expected always to be able to set out when and by how much the monthly price of so-called ‘tiered’ telecoms contracts (i.e. those that include a definite annual increase) will increase, adding that “the full future monthly price and when it will rise are likely to constitute material information that the consumer needs to make an informed transactional decision (which can include decisions prior to the act of purchase)”. Furthermore, given that the future price of such contracts can be calculated in advance, presenting any mid-contract increase “in percentage terms or in terms of a pounds and pence figure to be added to the original price is unlikely to be sufficient to communicate this material information to consumers”.

As for so-called ‘variable’ contracts – which include a clause providing that the monthly price may rise in the future (but it is unknown if and by how much) and provide for a customer to be informed about any increase with one month’s notice and for them to be able to subsequently terminate the contract without penalty – the Guidance states that the fact that the price may be subject to an increase is also likely to constitute material information which should be presented clearly and prominently.

By way of more general pointers, the Guidance also states, for example, that: an ad is more likely to comply when information indicating the presence or possibility of a price rise has equal prominence with the initial price claim; an ad is more likely to comply when the future price statement is featured prominently within the main copy of the ad; and ads are more likely to comply when advertisers are mindful of the time of year when the ad is being published, relative to the timing of any compulsory annual increase.

The new Guidance will come into force on 17 January 2025, the same date on which the new Ofcom rules take effect. To read the Guidance in full, click here.