Telus claims new refund rules will cost it ‘tens of millions’

Telus Corp. is unimpressed with new refund regulations it claims will cost the company tens of millions of dollars annually.

Canada's third-largest telecommunications provider filed an application with the Canadian Radio-television and Telecommunications Commission over a May decision requiring wireless, voice and Internet service providers to pay prorated refunds to customers who cancel prepaid contracts.

Telus argues this “surprise” decision modified a long-standing practice not to pay refunds when a customer cancels in the middle of the month — most Canadians prepay monthly for service — and will require significant changes to billing systems to ensure customers get their money back whether they cancel with 27 or three unused days.

These amounts are “minuscule and insignificant” to a customer but are “significant, in the aggregate, to network providers who are attempting to invest in network expansion and continued innovation,” Telus senior vice-president of regulatory affairs Ted Woodhead wrote in the application.

“As a direct result of the decision, Telus' revenues will be reduced by tens of millions of dollars per annum.”

Telus asked the commission for guidance on how to apply the refunds in complicated scenarios and for an extension to implement the new rules. It argued the decision was made without proper consultation, so it deserves an extra six months from the time the CRTC rules on its application to account for hundreds of possible cancellation scenarios.

The decision stemmed from a dispute between Quebecor Inc.owned Videotron and Bell Canada, but the CRTC expanded it to include all service providers. It ruled that providers must not charge for a service that isn't provided to ensure customers aren't penalized for switching carriers by having to pay two bills at once.

“By removing unnecessary barriers to consumer choice, the prohibitions also contribute to a more dynamic marketplace,” the CRTC determined.