Barring of service as a credit control measure

A supplier is entitled to suspend or otherwise restrict a new customer's access to certain services (e.g. long distance calls) as part of its credit assessment processes. However, Clause 7.2.1 of the Telecommunications Consumer Protections Code Code requires a supplier to inform its prospective customer that it intends to do this.

A supplier is also entitled to restrict access to certain services for an existing customer, as a credit management measure, if it makes reasonable attempts to inform the customer beforehand.

Under Clause 7.4.8 (a) of the Telecommunications Consumer Protections (TCP) Code, a provider 'may Suspend or Restrict a Service without Informing the Customer if [it] (i) assesses that the Customer or the account status presents an unacceptably high credit risk or (ii) reasonably suspects Fraud or attempted Fraud.' However, as a general rule, the TIO still expects a provider to notify a customer of its intention to restrict, suspend or disconnect a service by phone or in writing [Clauses 7.4.6, 7.4.7 & 7.4.9 of the TCP Code).

For more information, see the TIO’s Position Statement on Notification of Suspension or Disconnection of Service.

For a specific discussion of restricted access to a telephone service in cases where hardship is claimed, see the TIO’s position statement on Hardship and Payment Difficulties.

Where a provider undertakes to impose a 'credit limit' (or ‘cap’) on a customer's account, or in any way leads a customer to believe that they will not be able to use their service once charges on their account have reached a predetermined amount, the TIO expects a provider to honour such a commitment. The TIO will investigate complaints about providers failing to impose 'credit limits' in such cases, even where it is established that a provider may not have the technical ability to impose a ‘credit limit’.

Updated: 8 May 2008