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Charges

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Complaints we receive about charges include claims that a consumer has been charged:

  • at different rates to what they agreed to
  • for excess usage
  • for unauthorised usage by a third party
  • for equipment rental that they dispute
  • for international mobile roaming without knowing they were roaming or would be charged
  • for mobile premium services they did not request, mobile premium content that was not received, or barring mobile premium services
  • an administrative or miscellaneous fee they think is excessive or did not agree to pay
  • for services from a third party company they did not agree to receive.

See our position statement Billing for information about billing issues.

In this position statement, when we use the term product we are referring to both telecommunications goods and services.

Laws and codes of practice

The following laws and codes of practice are relevant to charges.

Our approach

When we deal with complaints about charges we consider the law, good industry practice, and fairness in all the circumstances.

The law

The International Mobile Roaming Industry Standard sets rules for informing consumers about charges for international mobile roaming.

The Mobile Premium Services Determination sets rules for barring mobile premium services, including:

  • there should be no charge for barring premium services
  • charges for premium services should end by 6pm on the first business day after the consumer asked for premium services to be barred.

Good industry practice

Rules in the Telecommunications Consumer Protections Code about charges include:

In its critical information summary for a product a provider must include a section called ‘Information about pricing’, giving the following information where relevant:

  • the minimum monthly charge (where calculable)
  • the maximum monthly charge (where calculable)
  • the maximum charge payable for early termination
  • for mobile services, when the offer is not unlimited, the cost (before any discounts are applied) of making a 2 minute standard national mobile call (including flagfall where applicable)
  • for mobile services, when the offer is not unlimited, the cost (before any discounts are applied) of sending a standard national mobile SMS
  • where the offer is not unlimited, the cost (before any discounts are applied) of using one megabyte of data within Australia
  • for post-paid mobile services on included value plans, an estimate of the maximum number of 2 minute standard national mobile calls a consumer could make within the included value plan.

See our position statement Pre-sale information or conduct for more information about critical information summaries.

When billing charges, a provider must:

  • make sure it provides and can demonstrate valid and correctly calculated charges
  • take reasonable care and precautions to make sure it avoids any billing inaccuracy.

The provider must make sure enough information is readily available to a consumer for them to verify that charges are correct and consistent with the provider’s published or contracted charges and discounts, and the product the consumer requested, used, or contracted to receive.

The Mobile Premium Services Code sets out rules for charges for mobile premium services, reverse charge billing services, and proprietary network services, including rules about:

  • pre-sale information about premium fees and data fees
  • pricing information
  • charges for providing service information
  • prohibited charges, for example charging for a service that wasn’t requested, or charging a premium fee for an error message, or charging for undelivered content
  • limits for unsubscribe fees.

TIO view

Undisputed charges

Generally, consumers are liable for valid charges incurred in the use of their service. We recommend that consumers check their bills regularly, raise any disputes early, and pay or arrange to pay all amounts they do not dispute.

The TIO Terms of Reference state that we may stop handling a complaint if we think it is reasonable for the consumer to pay some or all of the undisputed charges and the consumer refuses to pay this amount.

Liability for charges incurred through unauthorised use of a service

When there is unauthorised use of a service we assess a range of factors to decide which party is liable for the resulting charges. These factors depend on the circumstances and the type of service involved. Examples include:

  • If a provider supplies a product with associated security arrangements that could be easily compromised (for example a default password) and does not explain to the consumer how to improve the security of their service (for example, by resetting the password), the provider may be liable for usage incurred from hacking.
  • When a mobile phone is lost or stolen, an unreasonable delay by the consumer in reporting this to their provider may mean that the consumer is liable for some or all usage after the loss or theft. Alternatively, when a provider does not promptly act on a report of a lost or stolen phone, it may be liable for any unauthorised usage charges.
  • If a provider identifies (or ought to have reasonably identified) unusual usage on the consumer’s service and did not alert the consumer within a reasonable time, it may be liable for some or all of the unauthorised usage charges.

When a consumer is liable for some charges it would not be fair for the provider to profit from unauthorised use. A provider should not recover any charges that are in excess of the provider’s actual costs in providing the service.

Equipment rental charges

Rental charges and other equipment charges must be verifiable and linked to contract terms.

Unit pricing

A provider should make additional information about pricing available to the consumer to fully explain how it applies unit pricing when relevant. This information may include whether the provider rounds up data usage to the nearest megabyte or kilobyte, or charges for voice calls in 30 second or one minute blocks.

Administrative or miscellaneous charges

Administrative or miscellaneous charges, for example late payment fees or direct debit dishonour fees, should always be reasonable and be no more than the cost actually incurred by the provider.

For information about charges for cancelling a service, see our position statement Contracts.

Third party charges billed by the provider

If a telecommunications service allows a consumer to incur charges for third party products – for example, mobile applications (apps) or in-app purchases – on their telecommunications bill or pre-paid credit, the consumer should be made aware of this before they incur the third party charges.

Third party charges that are billed on the provider’s bill must be easily identifiable, clear, verifiable and accurate.

Providers should have appropriate spend management tools in place to manage these types of charges.

The provider shares responsibility with the third party for resolving disputes about third party charges it bills to the consumer.

Dealing with a dispute

When dealing with a dispute about charges we ask for information from both the consumer and the provider. This may include:

  • the terms and conditions for the product to which the charges relate
  • critical information summaries for the products, if relevant
  • copies of bills showing the charges
  • raw call data
  • the actual cost of the services to the provider
  • customer care records
  • information about security arrangements, if relevant, for any equipment supplied by the provider
  • loss or theft reports.

Outcomes

When, in our view:

  • a provider did not give accurate information about how it charges
  • the charges billed are not clear, verifiable or accurate, or
  • the provider has not met its obligations under the relevant rules or otherwise not acted fairly,

outcomes may include the provider giving more information about its charges, waiving some or all of the disputed charges and re-rating bills at the correct rates, or letting the consumer cancel the service with no exit fee.

When, in our view, there was unauthorised use of a service, we may allocate liability for the charges to the provider, the consumer, or both.

When in our view, the consumer does not pay undisputed charges or such amount as the Ombudsman thinks is reasonable, we may decline to consider the complaint further.

Effective date: 11 March 2016

This position statement provides broad guidance on the law, good industry practice, and what the TIO may consider to be fair and reasonable in general circumstances. It is not a full statement of the law or good industry practice. The TIO considers each matter brought to it on its own particular merits.  

Phone and Internet Bundle

case study image

A man contacted us because he was not provided with the service agreed to in his contract for a bundled landline and internet service.

Next step?              

  • make an online complaint
  • 1800 062 058                
  • Write PO Box 276
    Collins Street West Vic 8007                            
  • National Relay Service Call on 1800 555 677 then ask for 1800 062 058            
  • Fax our consumer complaint form to 1800 630 614