Summary of the issue

Some Scheme Members sell handsets locked to the Scheme Member’s network only.  That means the Customer is not able to use that handset as a customer of another network.  Customers may be dissatisfied with that, and seek to have their handset unlocked to use with another provider.

Usual positions of the parties

The Customer may consider it unreasonable that they cannot use the handset they purchased from the Scheme Member, with another provider, and seek an order from TDR that the handset be unlocked, or the contract cancelled.

The Scheme Member may decline to unlock the handset, on the basis that they had put the Customer on notice when the handset was purchased, that it was locked to that provider’s network.

TDR’s view of the issue

TDR recognise that handsets sold as ‘locked’ are generally sold for a lower price than unlocked handsets.  Therefore, to a degree, the Scheme Member will be subsidising the handset on the basis that the Customer will use the services which it provides.

TDR will generally uphold a Scheme Member’s decision declining to unlock a handset, providing the Customer has been put on notice that the handset is locked to that provider.  If proper notice has been provided that the handset is locked, then that becomes a term of the contract which exists between the parties for the purchase of that product.

Proper notice could be given in a number of ways, but it should be as a minimum in writing.  That may include a notice clearly printed on the box which the Customer could reasonably be expected to see prior to the sale taking place.  If the notice is on the box of the handset, it should be in print which stands out, so as to draw the attention of the customer to the notice.

If the Scheme Member has not reasonably notified the Customer that the handset is locked, TDR will likely direct the Scheme Member to unlock the handset, or cancel the contract and refund all money paid for the handset and any associated contract.