Vaya responds to ACCC investigation

8 March 2016

Telecommunications company Vaya has taken measures to address concerns raised by the Australian Competition and Consumer Commission following a spike in consumer complaints.

Last year, the ACCC commenced an investigation into Vaya’s practices after customers complained about emails they received with contract variations.

In September 2014, Vaya sent an email to selected customers stating that at the end of their 24 month contract they could keep their current plan if they paid a monthly $9.90 fee called a ‘Plan Freeze Fee’, on top of their monthly access fee. Vaya sent this email to customers before their 24 month contract expired and in some cases charged the fee before customers’ contracts expired.

In February 2015, Vaya sent an email to its customers stating that all customers were required to pay a “once-off, refundable $20 Security Deposit” (Security Deposit) in accordance with Vaya’s Terms and Conditions and the Telecommunications Consumer Protection Code (TCP Code).

The ACCC formed the view that Vaya’s Plan Freeze Fee email was likely to be misleading because it represented that consumers were required to pay extra fees, when in fact, under their contracts rates were fixed. The ACCC also considered that Vaya’s Security Deposit email was also likely to be misleading as it failed to inform consumers of their rights of termination under Vaya’s terms and conditions and Vaya’s obligations under the Telecommunications Consumer Protection Code (TCP Code).

Vaya took a number of steps to address these concerns:

  • Vaya refunded all customers who were incorrectly charged the Plan Freeze Fee.
  • Vaya informed customers who complained about the Security Deposit and Plan Freeze Fee of their right to terminate their contracts without penalty.
  • Vaya committed to improving the transparency of its customer communications and advertising.  

“The Australian Competition and Consumer Commission welcomes voluntary action by businesses in addressing consumer complaints,” ACCC Commissioner Sarah Court said.

When signing up for contracts, consumers should familiarise themselves with their rights in the event of a contract variation. If consumers have concerns about changes to their telecommunications contract they can:

  • Contact their provider to ask questions about the changes;
  • Contact the TIO; and
  • Lodge a complaint with the ACCC or local fair trading agency.

Background

In December 2015 the Australian Communications and Media Authority released a finding that Vaya’s implementation of a Security Deposit was in breach of the TCP Code. http://www.acma.gov.au/Industry/Telco/Reconnecting-the-customer/TCP-code/acma-finds-vaya-and-live-connected-imposed-security-deposits-in-breach-of-the-code

Release number: 
MR 25/16
Media enquiries: 
Media team - 1300 138 917

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