MCA Consultation On Inflation-Linked Contract Price Increases

Article 20 of the Universal Services Directive provides that service providers must ensure that consumers have the right to a contract which must include (amongst other things) details of prices and tariffs. When service providers make changes to their contract, subscribers have a right to withdraw from that contract without penalty.

In the past few months, service providers in Malta (following trends in other jurisdictions including the UK, Italy and Ireland) have introduced clauses allowing for automatic price increases linked to inflation. This follows from a 2015 judgment of the ECJ following a Preliminary Reference by an Austrian Court in Austrian Consumers' Association v A1 Telekom Austria AG. In that judgment, the ECJ held that a change in the charges for the provision of an electronic communication service resulting from a price adjustment clause does not constitute a modification to the contractual conditions within the meaning of Article 20 of the USD.