Kogan chief Ruslan Kogan. Photo: Luis Ascui
A prominent Australian telco lawyer has labelled as "plainly illegal" Kogan Mobile's acceptable-use policy, which the company has been using to disconnect heavy-use mobile customers.
The lawyer's comments come as Kogan said 0.2 per cent of customers had been affected by enforcement of the policy, which equates to 200 of about 100,000 customers.
Peter Moon, of Cooper Mills Lawyers, reviewed Kogan's acceptable-use policy and said it was illegal and breached both the telco regulator's Telecommunications Consumer Protections code and Australian Consumer Law in multiple ways.
Mr Moon wrote about his concerns in two blog posts at tcpcode.com.au. The posts have since been deleted however, after Mr Moon accepted a request for their removal by a lawyer acting on behalf of Kogan. Despite this, he said on Thursday that he stood by his comments.
In a critique of the policies, Mr Moon questioned the use of "unlimited" when describing Kogan mobile plans, said the acceptable-use policy was "unclear and ambiguous" and criticised the fact it stated it could be changed at any time by posting a note on Kogan's website.
"This breaches the 'unfair contract terms' rules in the Australian Consumer Law," Mr Moon said. "The days when a telco could say to residential/personal customers, 'The deal is whatever we say it is from time to time', are long over."
Another telco lawyer, who did not want to be named for conflict reasons, backed up Mr Moon's comments, agreeing that Kogan had "some work to do to bring their documents and advertising into legal compliance".
Customers Kogan has been telling to leave its network were told they were making too many calls, sending too many texts or using too much data in a certain period on its prepaid "unlimited" call/text plans with either 2GB or 6GB of data.
In recent years the Australian Competition and Consumer Commission has cracked down on use of "unlimited", but said in relation to Kogan that it did not "ordinarily comment" on whether specific issues or businesses were being investigated. As recent as this month, the commission also cracked down on telcos, including Telstra and TPG, using unfair contract terms.
The Telecommunications Industry Ombudsman said it had "received a small number of complaints" from Kogan consumers but could not give the total number until May, when it releases its quarterly statistics.
A Kogan spokesman said the company's terms and conditions, including its acceptable-use policy, were drafted and prepared by Gilbert + Tobin Lawyers, who were "widely regarded as one of the leading telecommunications law firms in Australia ... also used by Telstra".
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