Draft bill 151.

Summary.

The draft bill proposes to strengthen the rights of people who contract for or use public telecommunications services in the Republic of Panama. It would apply to concessionaires providing mobile and fixed-line telephone service, Internet access, subscription television, data transmission, converged services, and other services regulated by Law 31 of 1996. It provides that the law be interpreted in light of user protection, good faith, contractual balance, transparency, service continuity, free competition, and truthful and timely information. It defines essential contract terms, unilateral modification, bundled services, commercial plans, migration, permanent benefits, economic and hidden increases, and technical feasibility. It recognizes users’ rights to receive information, retain technically feasible terms and plans, choose services, file complaints free of charge, and obtain refunds of charges contrary to the law.

Contracts would have to preserve the essential terms accepted when they were concluded. Those terms could be changed only to comply with a law or binding resolution, at the user’s express request, because of a substantiated technical impossibility arising later, or through technological improvements that increase quality at no additional cost. A concessionaire would have to provide an objective justification for a change; the text presumes that a change without justification is contrary to the law and that one aimed primarily at obtaining an economic benefit through unilateral changes is incompatible with good faith. For bundles, users could remove services while retaining the remaining services and their permanent benefits. The draft restricts price adjustments, tying arrangements, and mandatory migrations. An unfavorable change would require free, prior, express, and informed consent; silence or continued use of the service would not constitute acceptance.

A concessionaire would have to notify users individually of changes to essential terms at least 30 calendar days in advance, stating the reason, effective date, rights, and complaint process. Its communications would have to be understandable and could not present price increases or reductions in rights as improvements. The text describes hidden increases, including reductions in speed, data, content, or benefits without a corresponding price adjustment. Before changing an existing contract, the concessionaire would prepare a technical, economic, and legal report, keep it available to the National Authority for Public Services (Autoridad Nacional de los Servicios Públicos, ASEP), inform the user, and provide a means to submit observations and complaints. Omission of any of these requirements would prevent the change from taking effect against the affected user. The documentation would be retained for at least 5 years.

ASEP could request information, inspect case files, order audits, and adopt measures to restore rights. These include suspending changes, reinstating terms and benefits, refunding improper charges, and ordering interim measures during an investigation. In coordination with the Consumer Protection and Competition Defense Authority (Autoridad de Protección al Consumidor y Defensa de la Competencia, ACODECO), to which Law 45 of 2007 assigns powers, ASEP would refer case files concerning possible unfair commercial practices, misleading advertising, unfair terms, or harm to competition. Users would first complain to the concessionaire and could then turn to ASEP; the draft also provides for suspension of the effects of a disputed change and voluntary conciliation.

The text establishes violations involving improper changes, failure to provide information or documentation, noncompliance with orders, mandatory migrations, hidden increases, and obstacles associated with bundles. ASEP would apply the procedures and penalties under Law 31 of February 8, 1996, with the possibility of individual or collective remedies. The draft bill adds a chapter on user rights to that law and requires standard-form contracts to be adapted; incompatible clauses would have no effect against users. Concessionaires would have 180 calendar days to comply, and ASEP would issue implementing regulations within 120 calendar days of promulgation. The draft provides for application to earlier proceedings when doing so favors the user without affecting third parties’ vested rights, and for entry into force 6 months after promulgation in the Official Gazette. Its provisions concern ASEP and ACODECO, as well as telecommunications and subscription television users and concessionaires.