What’s going on?

On December 1st, new amendments to the Telecommunications Act came into force in Germany. The updates bring with them wide-ranging changes to consumer rights laws for people who’ve signed – or will sign – new mobile, landline and internet contracts.

The headline change relates to the amount of time contracts are allowed to run for after they renew. If a customer signs up to a 24-month mobile contract and doesn’t cancel before it renews, telecommunications companies will no longer be allowed to sign that customer up for another one or two years without their permission.

Instead, people who don’t cancel in time will be put onto a one-month rolling contract that essentially allows them to terminate at any point with just one month’s notice.

It’s an end to a tax on the disorganised that has seen people stuck paying for contracts they no longer want or need for up to 24 months longer – often at higher prices than they agreed when they first signed the contract.

Does that mean all contracts will be rolling contracts?

Not exactly. As before, most new contracts will run for a minimum 24-month term – so expect to be locked in for at least this long, unless you specifically look for a more flexible contract. 

The change affects what happens after this initial term is up, meaning if you do sign up for a yearly contract, one year won’t automatically turn into two if you don’t remember to cancel it in time. 

READ ALSO: Everything that changes in Germany in December 2021

What else is new?

Alongside the key changes to contract durations, there are also changes to the way in which contracts are agreed and tougher standards for internet providers.

In future, if you agree a contract over the phone, you have to receive a summary of the terms of the contract and confirm it in writing before the agreement is legally valid. 

This summary must include the service provider’s contact details, a description of agreed services, details of any activation fees, the duration of the contract and any conditions for renewal and termination. Without written approval, the contract has no legal standing and the provider has no claims against the customer – even if they switched to the new services immediately after the telephone call.

A young man takes a phone call on a tram in Hannover. Under the new changes, contracts agreed over the phone will not be valid until they are confirmed in writing. Photo: picture alliance/dpa | Hauke-Christian Dittrich

If a provider makes a change to a contract after it’s up and running, customers now have the right to terminate without notice.

In future, providers must inform customers if there are more favourable offers available and a change to a new contract would be possible.  This must happen once a year, and once again, providers aren’t allowed to do this solely over the phone. 

For broadband customers, there’s more good news: internet providers will in future face issues if they don’t provide the bandwidth stated in the contract. 

That means that if your internet is slower than promised, you should have the right to pay a reduced price or terminate the contract. 

READ ALSO: Moving house in Germany: 7 things you need to know about setting up utility contracts

I signed a new contract a while ago. Do the new rules still apply? 

Yes, they do. Regardless of when you signed your new contract, the amendments to the Telecommunications Act will apply. 

That means that once your initial contract period is up, you should be able to cancel freely and only pay for the month’s notice. You should also be informed of any changes to your contract or better offers and be eligible for compensation if your internet goes below the promised bandwidth. 

If you’ve already been locked in to a 12- or 24-month contract through an auto-renewal, the situation is a bit less clear – but it may be worth contacting your provider and asking them if the terms of your contract have changed in light of the new law. 

READ ALSO: Has it just got easier to end credit agreements in Germany?

What are people saying?

The Telecommunications and Value-Added Services Association, which represents the industry, said it was important than the initial 24-month contracts were allowed to continue. The subsequent new notice periods are a good compromise, VATM Managing Director Jürgen Grützner told Tagesschau. 

“On the one hand, this means better financial forecasting for expanding providers’ networks and, on the other hand, the best of both worlds for consumers,” he added. 

“We need fast internet!” is scrawled in huge letters across a street in Weetzen, Lower Saxony. Photo: picture alliance/dpa | Ole Spata

However, Grützner believes the new rules on bandwidth could cause difficulties for providers who struggle to offer the same quality of internet across all regions. 

Meanwhile, consumer rights advocates have welcomed the improvements to contract law. 

In particular, the Federal Consumer Advice Centre “expects competition to improve as a result of the new regulation, including the price-performance ratio,” Susanne Blohm from the organisation’s Digital and Media Division told Tagesschau.

In an initial sign of the regulation’s positive impact, the provider Telefonica has announced that it will abolish surcharges for contracts that don’t have a minimum cancellation period. 

Vocabulary

amendments – (die) Novelle

bandwidth – (die) Bandbreite 

minimum contract term – (die) Mindestlaufzeit 

provider – (der) Anbieter