BT is facing a £600 million claim that alleges historic excessive pricing for elderly and vulnerable landline customers.
The telecoms giant is accused of anti-competitive behaviour towards its landline-only customers. But it has said it will vigorously defend itself against the class-action claim, which could see more than two million customers owed hundreds of pounds in compensation for overcharging over a number of years.
The claim has been brought in the Competition Appeal Tribunal and is based on the 2017 review by communication regulator Ofcom of landline-only pricing. The review found that elderly and vulnerable landline-only customers were receiving poor value for money compared to those paying for packages that saw landlines provided alongside broadband and / or pay television.
BT did agree to reduce its monthly line rental price to landline-only customers. It then gave landline price guarantees until 2025. But the legal action is being brought for historic overcharging and on behalf of those not covered by BT’s voluntary price reduction.
BT has said it disagrees with the claim and has not been found to have been involved in excessive pricing or a breach of competition law.
It will be some time before the conclusion of this case. But it certainly highlights the need for businesses to be fully aware of competition law. Any company where there is a risk of anti-competitive activity has to take professional advice to ensure they are acting within that law.
Breaches of competition law can result in huge financial penalties, cause severe reputational damage and have a grave effect on the ability to conduct future business.