Communications minister limits telecom exit fees

The new ruling will apply to the Internet, int'l calls, cable and satellite, and fixed-line telephone.

By YAEL GRUNTMAN/GLOBES
Communications Minister Moshe Kahlon has ordered the cancelation of exit fees for customers in the local telecommunications market.
The new ruling will apply to the Internet, international calls, cable and satellite, and fixedline telephony, as well as the carriers’ current subscribers.
“After limiting the exit fees by mobile carriers, the next step is to limit the exit fees in the telecommunications market,” said Kahlon. “When the law is passed, it will lift a major barrier that will help improve competition, and customers will be free to switch carriers without fear of fines.”
On February 1, the Communications Ministry restricted exit fines for customers switching mobile carriers, including for customers with current contracts. Customers can now switch carriers with payment of a nominal fee for terminating the contract: 8 percent of the average monthly bill times the remaining number of months of the subscriber’s commitment period.
The measure is part of the ministry’s policy to reduce barriers empowering subscribers and facilitate their switching service providers.
The Communications Ministry is also seeking to expand competition by allowing customers to chose additional alternatives.
The ministry’s favoring of the Israel Electric Corporation fiber optics telecommunications infrastructure venture is one of these measures.
An example of future exit fines is as follows: for an 18-month commitment period with a 12-month exit point and an average monthly bill of NIS 500, the exit fine will be 8% times NIS 500 times six months, for a total of NIS 240.