Telenor Hungary punished for illegal contract term changes

Telenor Hungary was fined nearly €1 million by the country's National Media and Infocommunications Authority (NMHH) for illegally amending the terms of its subscribers' contracts.

The Hungarian authority levied a fine of HUF250 million (€814,593/$906,101) on the operator following a probe of amendments Telenor Hungary made in July 2014 that affected 93 tariffs. Some HUF500,000 of the fine was imposed directly on Telenor Hungary's CEO Christopher Laska for what the NMHH described as "repeated violation of the prevailing rules applicable to electronic communications and of the general contractual terms."

In a statement, the NMHH explains that the fine is the latest in a series of penalties imposed on Telenor Hungary in recent years for breaching the laws covering unilateral changes to subscribers' tariffs.

While Hungarian telecoms laws enable operators to make changes mid-contract provided there has been a "substantive change in circumstances", the NMHH ruled that Telenor's reasons for increasing its service fees did not meet that criteria, the Authority explained in a statement.

Telenor unilaterally amended subscribers' contracts to account for inflation in real estate prices, fluctuations in exchange rates between the Hungarian Forint and Euro, and changes to Hungary's electronic communications laws, the NMHH said.

The Authority concluded that Telenor's contract amendments "violates consumer interests, as the service provider may only amend subscriber agreements unilaterally in precisely defined cases," it stated.

Hungary's communications laws only allow operators to unilaterally amend subscriber terms "in extraordinary cases, where the extent, intensity or sudden occurrence of the changes that have taken place to not facilitate the bilateral amendment of the contracts", the Authority explained.

In all other cases, operators must seek a bilateral agreement to change contract terms.

The NMHH also noted that Telenor has the right to appeal its decision on the level of financial penalty, by approaching the President of the Authority directly.

For more:
- view the NMHH's statement

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