NTT Docomo to follow KDDI in reviewing smartphone contracts
Kyodo -- Aug 03
Mobile carrier NTT Docomo Inc. said Thursday it plans to review its two-year smartphone contracts by next March, a day after rival KDDI Corp. pledged to change its contracts in response to government warnings.

For customers receiving discounts on monthly fees under the two-year contracts, Japan's three major carriers including SoftBank Corp. currently require subscribers to pay penalties if contracts are canceled before maturity or charges for extra one-month periods to end contracts shortly after 24 months.

While two-year contracts are automatically renewed, subscribers can terminate them without penalty fees or extra charges during the 25th and 26th months.

The top carriers have been using such sales tactics to retain subscribers, but the internal affairs ministry urged the three carriers in June to review their two-year rules.

Also in June, the Japan Fair Trade Commission warned that four-year installment payment plans provided by some carriers poses antitrust problems.

News source: Kyodo
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