CAP and BCAP have published updated guidance about how you should advertise your mid-contract price increases in telecoms ads. The updates reflect changes to Ofcom rules that effectively ban inflation-linked and percentage-based price increases in new contracts from 17 January 2025. The amended CAP and BCAP guidance will also come into force on the same day.

Ofcom amended its General Conditions in July 2024 to require providers to set out at the point of sale what the changed monthly price of a contract will be, if it is to change during the consumer's contract period, and from when the changed price will apply, in pounds and pence. This effectively prevents providers from offering contracts that provide for inflation-linked price rises, or price rises set out in percentage terms, to the monthly price during the contract period.

The (B)CAP guidance requires that information about the presence and nature of a mid-contract price rise should be clear and prominent to avoid misleading consumers. It was originally written in a context in which the market featured many contracts that included a set percentage-based increase, plus an inflation-linked increase that could only be calculated shortly before the increase took effect.

The guidance already provided that if the amount by which the customer’s monthly contract price would increase was known in advance, then it should be stated in full. The amendments clarify that the full future monthly price and when it will rise are likely to constitute material information that the consumer needs to make an informed transactional decision. Because how to calculate the future price will always be known in advance, percentage-based presentations of the price are unlikely to be sufficient to avoid misleading the consumer.

In addition, ads for telecoms contracts that include (or could include) a mid-contract price rise are less likely to mislead if:

• Information indicating the presence or (in the case of variable contract) possibility of a price rise has equal prominence with the initial price claim.
• Information on the nature of the price rise (the full future price in pounds and pence) is prominently featured within the main ad copy – no lower than one ‘step’ below the initial price claim.

The guidance is underpinned by the Consumer Protection from Unfair Trading Regulations 2008 which will be replaced from April 2025 by the Digital Markets, Competition and Consumer Act 2024. However, this does not change the guidance. 

The amended guidance will take effect on 17 January 2025.   If you market broadband or mobile contracts, you need to bear this in mind alongside Ofcom's requirements.