CRTC ordered to investigate Canada’s large telecom carriers over high-pressure sales practices

The news comes four months after the CRTC told the PIAC the Commission wouldn’t launch an investigation

The federal government has directed Canada’s telecom watchdog to launch an investigation into allegations regarding high-pressure sales practices used by Canada’s “large telecommunications carriers.”

According to a June 14th, 2018 Innovation, Science and Economic Development Canada (ISED) backgrounder, the Governor in Council has directed the Canadian Radio-television and Telecommunications Commission (CRTC) to complete a report regarding the sales practices of Canada’s large carriers by February 28th, 2019.

A CRTC spokesperson confirmed that the Commission received the federal government’s request.

“We understand that there are growing concerns about this issue,” said a CRTC spokesperson in a June 14th, 2018 email to MobileSyrup. “We will announce next steps in due course.”

A letter penned by innovation minister Navdeep Bains to Matthew Boswell — the interim commissioner of competition at the Competition Bureau — further explains the federal government’s decision to investigate Canada’s largest carriers for their sales practices.

“In recent months, there has been a series of such reports alleging certain practices by sales agents of telecommunications carriers such as aggressive upselling or failing to provide necessary information for Canadians to make informed decisions,” wrote Bains, in his June 14th, 2018 letter to the Competition Bureau.

“There are reports that these practices exploit the unequal level of information possessed by sales agents relative to consumers and that vulnerable Canadians are more likely to be harmed.”

“In recent months, there has been a series of such reports alleging certain practices by sales agents of telecommunications carriers such as aggressive upselling…” — Navdeep Bains, ISED

Bains’ letter references reports alleging that Canadian carriers repeatedly engaged in unsavoury and harmful sales practices, often upselling products and services to customers who are uninformed or unaware.

The largest telecommunications companies in Canada are Rogers, Bell, Telus, Shaw and Quebecor.

The letter further requests that the Competition Bureau aid the CRTC in its sales practice investigation.

“In recognition that you and your officials have expertise and experience with respect to deceptive marketing practices that could be useful in assessing the reports of high pressure sales tactics, I request that you assist the CRTC in its inquiry leading to the report in the manner and to the extent that you judge appropriate,” wrote Bains.

Great news for the PIAC

Today’s announcement comes roughly four months after CRTC chairperson Ian Scott confirmed that the Commission would not conduct an investigation into unsavoury telecom sales practices at the request of the Public Interest Advocacy Centre (PIAC).

In Scott’s February 14th, 2018 letter to the PIAC, he argued that Canadians already have a number of avenues in order to submit complaints about telecom sales.

“If Canadians consider that their wireless, internet, home phone or TV service provider has not provided clear and accurate information to them about their [contracts], or is not acting in a manner consistent with the CRTC’s Wireless Code or Television Provider Service Code, they should first try to resolve the issue with their service provider,” said Scott, in the February 14th letter.

“If the matter is not resolved to their satisfaction, they are encouraged to escalate the complaint to the Commissioner for Complaints for Telecom-Television Services (CCTS).”

“There are reports that these practices exploit the unequal level of information possessed by sales agents relative to consumers…” — Navdeep Bains, ISED

John Lawford, executive director and general counsel for the PIAC told MobileSyrup that today’s news is a sign that government is listening to the concerns of citizens.

“I would expect big things from, this, and what’s nice about this is that the government recognizes that the public needs to have reassurance,” said Lawford, in a phone call with MobileSyrup.

“It’s also nice to see that the government doesn’t think people were making it up.”

Lawford added that he isn’t sure what precisely will result from the CRTC’s inquiry, but that it’s possible that some kind revision to Canada’s Wireless Code of Conduct could take place.

A response from Canada’s largest telecommunications providers

In an email statement to MobileSyrup, a Rogers spokesperson wrote that the company will participate in the CRTC inquiry.

“We strive to deliver the best possible experience for our customers with products and services that best meet their needs and budget, and we will participate and share how we work to be clear, simple and fair with our customers every time they contact us,” said Rogers.

In a statement to MobileSyrup, Bell noted, “We’re happy to talk with the government about customer service. Bell’s success depends on delivering the best customer experience and we’re seeing consistent growth in both customer satisfaction and subscriber growth.”

It’s important to note that Canada’s two largest telecom service providers, Rogers and Bell, were the subjects of two separate CBC News investigations that revealed that customer service representatives felt compelled to pressure customers into making purchases they didn’t need.

Both Bell and Rogers denied these allegations.

As Canada’s third-largest carrier by subscriber-share, MobileSyrup also reached out to Telus for comment.

For its part, Telus said that it looks forward to participating in the CRTC’s inquiry.

“We look forward to participating constructively in the CRTC’s review and are optimistic it will help to elevate and standardize best practices across the industry,” said Johanne Senecal, Telus’ senior vice president of government and regulatory affairs, in an email statement to MobileSyrup.

It’s worth mentioning that, unlike its fellow big three competitors, Telus has not faced as much public scrutiny for its sales practices.

In fact, as of the Commission for Complaints for Telecom-television Services’ (CCTS) 2017-2018 mid-year report, Telus logged the fewest number of accepted complaints out of all of Canada’s national carriers.

As of the 2017-2018 report, complaints against Telus counted for approximately 7.5 percent of all consumer concerns. That number is compared to 33.2 percent and 10.3 percent for Rogers and Bell, respectively.

Source: ISED

Update 14/06/2018 1:52pm ET: Story updated with comment from the CRTC.

Update 14/06/2018 4:18pm ET: Story updated with comment from the PIAC, Rogers, Bell and Telus.

Update 14/06/2018 7:38pm ET: Story updated with additional reporting.