This text seeks to highlight some of the main rules of the New Electronic Communications Act concerning the rights of end users, as set forth in its Articles 110 through 146.
What undertakings are subject to these rules?
Undertakings providing electronic communications networks or services are subject to the rules of the New Electronic Communications Act on end-user rights, including OTTs. Certain exemptions are allowed only for micro-enterprises offering number-independent interpersonal communications services (Article 110).
Who benefits from these rules?
Micro, small enterprises, or non-profit organizations join consumer end-users as the beneficiaries of these rules in line with the EECC, although express waiver of all or part of these provisions is allowed in certain cases. The relevance of this novelty is still to be tested against future market practices.
What are the main rights of end users?
All end users are, among other things, entitled to the following (Article 113):
(i) Be provided with written information on the service access and use terms and conditions;
(ii) Be provided at least 15-day notice of the termination of any service;
(iii) Be provided with information on the quality of the services provided;
(iv) Be provided with information on the billing for the services rendered, namely on the installation costs and on the expiry of the lock-in period;
(v) Increased protection for cases of non-express authorization/subscription (e.g. "wap billing");
(vi) Have access to tools to compare prices and other conditions;
(vii) An immediate and proportional reduction of the monthly fee in cases of suspension of services for periods equal to or longer than 24 consecutive hours, subject to any compensation;
(viii) Access the services subscribed on a continued basis, and be informed of the suspension of the service; and
(ix) Portability of numbers.
End users are further entitled to the following:
(i) Execute contracts containing the statutory specifications;
(ii) Upper thresholds for compensation payable for the breach of lock-in periods; and
(iii) Terminate the contract in the event of any discrepancy between the real and the agreed performance of the services.
Were there new non-discrimination rules introduced?
Yes. Among other things, the New Electronic Communications Act prohibits establishing different requirements or use or access conditions depending on nationality, place of residence, or place of business, save where objectively warranted, like costs and risks for example (Article 111). But the enshrinement of this principle could launch a discussion on how to read it in combination with the geographical block rules and what the expression “objectively warranted” actually means.
What are the main novelties in terms of procurement?
The cumbersome regime of pre-contractual information provision and service procurement arising from the previous Electronic Communications Act is reinforced in the new act (Articles 116, 120, and 121). The formalization and fleshing out of the obligation to adopt and provide the contract summary provided for in Commission Implementing Regulation (EU) 2019/2243 of 17 December (Article 120.6) is particularly noteworthy.
In terms of distance contracts, the exception relating to contracts by telephone contact by the consumer was eliminated, leaving the question of how to deal with these situations. Furthermore, by providing that the "information [provided] becomes an integral part of the contract and cannot be changed without the express agreement of the parties" (Article 120.10), it is unclear what contract terms may be amended without the agreement of the parties.
Lastly, regarding distance contracts where it is technically unfeasible to immediately provide the end consumer with a summary of the contract (Article 120.9), it is not clear when the contract enters into force, in view of the provisions of Article 120.12.
What are the main novelties in terms of bundles?
When the bundle of services includes at least one publicly available Internet access service or a publicly available number-based interpersonal communications service, all the services in the bundle enjoy increased protection, notably in terms of transparency of information, summary of the contract, and rules on service provision (Article 114).
The right to terminate any service in the bundle before the end of the lock-in period also extends to all other services. Restrictions are also imposed on the extension of the initial contract's lock-in period in the case of subscription of additional services or terminal equipment, although the scope of application of these rules is unclear.
Was the Internet use control mechanisms framework substantially amended?
Yes. The right to "free alerts" in case of changes to normal consumption patterns, already provided for in the previous Electronic Communications Act, was reinforced with the right to "timely information on the level of consumption of the services included in the end-user's tariff plan" (Article 123).
What are the essential features of the new unavailability of service framework?
A proportional invoice reduction is foreseen in cases of service unavailability not attributable to the consumer for periods longer than 24 hours, independent of the consumer's request. If the services remain unavailable for longer than 15 days, the end user is entitled to terminate the contract free of charge (Article 129).
It should be noted that the new framework seems to "hold" operators directly liable for acts beyond their control, such as force majeure events.
What about the new special service level breach framework?
Overall, any significant, continuous, or recurring discrepancy between the actual performance of the electronic communications services may be considered as a sufficient basis to terminate the contract free of charge (Article 130).
What changes regarding the contract holder could entitle the consumer to terminate the contract free of charge?
As discussed in Parliament, consumers may terminate contracts free of charge in the following instances (Article 136): (i) permanent change of their place of residence without the operator being able to assure the service on the same conditions at the new address; (ii) emigration to a third country, although the law states that this must be unforeseeable; (iii) unemployment due to redundancy not attributable to them and resulting in a loss of available monthly income; and (iv) permanent or temporary (more than 60 days) incapacity for work, resulting in a loss of available monthly income.
Despite the soundness of the legislative solutions, the vagueness of the concepts used will most likely generate discussion.
What events can entail the suspension or termination of the contracts free of charge to their holder?
In addition to the provisions on contract termination, the contract is suspended in the event of ( Article 137): (i) loss of the location where the services are provided; (ii) change of residence to a location outside of the national territory; (iii) absence from residence due to imprisonment, prolonged illness, dependency on care provided or to be provided by a third party; or (iv) unemployment or sick leave.
Note that a suspension that lasts longer than 180 days will result in the termination of the contract.
Can undertakings change contractual conditions without giving rise to a right to termination free of charge?
Yes, although on conditions that raise several practical questions, like broadly speaking (Article 135): (i) they are exclusively for the benefit of the end user; (ii) they have no "negative effect" on the end user; or (iii) they arise directly from the application of a legislative act. As was already the case under the previous Electronic Communications Act, the burden of proof for these facts lies with the undertaking seeking to change the contractual conditions.
What stands out in the new lock-in framework?
Despite a wide array of critiques, the legislator has chosen as policy, to a certain extent, to continue the previous framework, although it has created new problems, especially when it comes to lock-in extensions and renewed lock-in (having introduced the concepts of initial and subsequent lock-in). Lock-in periods of up to 24 months remain therefore a the possibility (Article 131), and the rationale of the framework continues to be based on the granting by the undertaking of consideration, duly identified and quantified in the contract, associated with: (i) the subsidization of terminal equipment; (ii) the installation of the service, where applicable; (iii) the activation of the service or (iv) other promotional conditions.
Do the terms to calculate the compensation in the event of the consumer terminating the contract remain unchanged?
No. The framework features several important novelties of uncertain outlines and impacts, with emphasis on the provision that charges cannot exceed the lesser of the following amounts (Article 136.4):
(i) The advantage afforded to consumers, as identified, and quantified in the relevant contract, proportional to the remainder of the lock-in period; and
(ii) A percentage of the monthly payments to fall due and payable, which will vary according to whether the lock-in period is initial or subsequent, between a maximum of 50% and 30% respectively.
The rule remains (Article 136.6) that undertakings must keep telephone recordings generated with their customers, although limited to the concept of termination and for the period of limitation and expiry of the obligations arising from the contracts. Besides their poor legislative technique, these rules raise many doubts.
Does the unblocking of terminal equipment remain subject to Decree-Law 56/2010, of 1 June 2010?
No. The New Electronic Communications Act incorporates this framework, where, for example, the prohibition of charging any amounts upon the expiry of the lock-in period remains in force, as does the % charging cap during this period, but several other innovative aspects are introduced. Coordination with the framework laid down in Decree-Law 56/2010, of 1 June 2010, and not expressly repealed, appears problematic though.
Does the new framework on end-user rights apply only to contracts executed after the entry into force of the New Electronic Communications Act or also to pre-existing contracts?
As a rule, the new framework applies only to contracts executed after its entry into force, except in cases expressly provided for as having immediate application, such as (Article 9 of the preamble): (i) the contract summary provision framework; (ii) end-user protection rules regarding the end of the lock-in period; (iii) billing free calls; (iv) privacy matters regarding any end-user information after debts are settled; (v) rules on service unavailability; (vi) changes regarding the contract holder; (vii) limitations on the charges payable in case of termination of the contract during the subsequent lock-in period without change of the local loop; and (viii) rules on contract suspension and termination.
Key takeaways
Like the EECC, the New Electronic Communications Act pays particular attention to end-user rights, materially reinforcing the framework across the three typical dimensions: (i) pre-procurement and procurement of services; (ii) contract performance; and (iii) contract termination. New specificities on service bundles are introduced and the subject of contract termination is reinforced, with relevant limitations in terms of compensations payable for the breach of lock-in periods. New rules are also introduced concerning the performance of services and changes to the contract that can lead to the termination of contracts free of charge.
There is no doubt that the end-user framework is among the most important in the New Electronic Communications Act and shows an increasing trend for the main foundation of regulation to be, effectively, the protection of users.
