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A public hearing on the draft code will take place Feb. 11 to 15. (Canadian Press)

Wireless providers would face limits on early termination fees and must unlock phones under "reasonable terms" under new draft guidelines released Monday by Canada's telecommunications regulator.

The Canadian Radio-television and Telecommunications Commission is asking the public for feedback on its draft "wireless code" via an online discussion that will remain open until 5 p.m. Feb. 15, the last day of a public hearing in Gatineau, Que., on the code. The hearing begins on Feb. 11.

Some of the proposals in the draft code, based partly on 3,500 comments submitted by Canadians to the commission in writing and 600 posted in an online discussion forum, include requiring that:

  • Customers receive a personalized summary of key terms and conditions in their contract, such as how much they would pay in cancellation charges at different times during their contract and what tools are available to help them monitor their usage of different services.
  • Wireless providers be required to unlock customers' wireless devices under "reasonable terms." Options for those terms include fees and time frames.
  • Customers be given tools to monitor their usage compared to the limits of their plan in order to be aware of extra fees they might incur if they go above the limits.
  • Customers be allowed to restrict features that could incur additional fees, and the ability to specify a cap to their monthly bill. Once the user hits the cap, the service provider would suspend services that could result in extra fees.
  • Early termination fees can only include subsidies on the price of phone or other mobile device and discounts the customer received for signing on to a contract of a specific length.

Under advertising guidelines in the draft code, wireless providers would still be able to advertise plans with some limits as "unlimited," but would have to explain "whether there are limits to the 'unlimited' plan and whether the service provider retains the discretion to move the consumer to a 'limited ' plan if usage limits are exceeded."

'Good first draft'

Consumer groups and wireless providers alike gave the plan an initial thumbs up.

"This draft code is a good start to work from," said Shawn Hall, a spokesman for Telus.

Read about how, and when, your cellphone contract could change for the better.

He added that the company will provide input once it's had a chance to review the draft in more detail and it thinks a national wireless code of conduct is "the right thing to do."

Lindsey Pinto, as spokeswoman for Open Media, a Vancouver-based public advocacy group that has campaigned for better treatment of wireless consumers by their mobile service providers, called the document a "good first draft."

The group, which will testify at the upcoming hearing, was particularly happy that the guidelines specify that they won't prevent customers from benefiting from provincial laws concerning wireless contracts that benefit the consumer. Pinto noted that some provinces, such as Quebec and Manitoba, have existing rules that are good for consumers.

One of the group's only concerns, she added, is that it would like the code to specify that termination fees can be made as monthly payments rather than a lump sum. The draft code allows wireless providers to charge a customer for the amount their mobile device was subsidized by the service provider when they signed a term contract – such as an iPhone that is "free" with a three-year contract. Pinto wants assurances that consumers don't get "slapped with the $700 cost of a phone" all at once.

"The more specific the code is … the less room big telecom companies have to basically go around it and apply what is a defacto termination fee."

However, not everyone was impressed with the draft code.

Technology journalist and blogger, Pete Nowak, tweeted that it "does little that isn't already happening."