Competition Bureau Calling on Prepaid Phone Card Providers to Disclose More Information

Ottawa, December 6, 2007 – The Competition Bureau has undertaken an initiative to ensure that consumers receive proper disclosure of any terms and conditions that affect the value and use of prepaid long distance telephone calling cards.

“This is an important initiative. Consumers need to be provided with accurate information so that they can make informed decisions and businesses need to be aware of the standards they need to follow in order to conform to the provisions of the Competition Act,” said Andrea Rosen, Acting Deputy Commissioner of Competition.

The Bureau will be contacting providers of prepaid telephone calling cards across Canada to ensure that these businesses disclose more information on the cards themselves and in any related advertising material. At a minimum, businesses should:

• Disclose the effective rate per minute and the number of minutes available on the card.
• Disclose any conditions that might adversely affect the advertised rate per minute and number of minutes near the main body of the representation - this information should not be printed in a small font or appear on a background that obstructs its visibility.
• Discontinue the use of fine print disclaimers that contain information contradicting the main message - the main body of the representation should not be misleading when read alone.

This outreach effort is part of the Bureau’s work to ensure accurate information disclosure by prepaid telephone calling card providers. The Bureau has reached an agreement with Gold Line Group of Companies (Gold Line) to adopt this minimum standard of disclosure. An example of a revised Gold Line promotional poster for its prepaid telephone cards, which now conforms to the Bureau’s above-noted standard, can be found on the Bureau’s Web site at: http://www.competitionbureau.gc.ca/epic/site/cb-bc.nsf/en/00480e.html

The Bureau receives a number of complaints each year relating to prepaid long distance phone cards. The specific complaints include cards that: provide less minutes than advertised, charge hidden fees (e.g. administration fees), and charge higher per-minute rates than advertised (e.g. higher fees for using the card at pay phones, or for calls made to or from cell phones). When deciding which type of prepaid calling card to purchase, consumers should be wary of “too good to be true” claims such as “the lowest rates” or “one cent per minute” as there may be hidden extra charges.

Consumers who suspect they have been a victim of deceptive marketing practices or who want information on the application of the Competition Act should contact the Bureau’s Information Centre at 1-800-348-5358 or visit www.competitionbureau.gc.ca.

The Competition Bureau is an independent law enforcement agency. We contribute to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.

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For media enquiries, please contact:
Pamela Wong
Communications Advisor
External Relations and Public Affairs Branch
819-953-7734

For general enquiries, please contact:
Information Centre
Competition Bureau
819-997-4282
Toll free: 1-800-348-5358
TDD (hearing impaired): 1-800-642-3844
compbureau@cb-bc.gc.ca