{June 28, 2006} VICTORIA – The Consumer Contracts Regulation has been amended to allow continuing services contracts to exceed 24 months, as long as the consumer can cancel the contract within 30 days.  The amendment takes effect on July 1, 2006. 

This amendment was made in response to industry’s concerns that limiting continuing services contracts to two years or less made it difficult for businesses to provide the services their customers expected. 

Affected businesses include those that provide dancing instruction, fitness, weight loss, or self defence training, and travel or vacation clubs.  These businesses commonly enter into continuing services contracts with their customers.  Continuing services contracts are contracts where the consumer receives and pays for services over a period of time, rather than all at once.  Sometimes, these continuing services contracts take the form of month-to-month contracts where a consumer makes a pre-authorized payment to a service provider on a monthly basis.  Before this amendment, these contracts would be contrary to the legislation after two years had passed even though the consumer was able to cancel at any time. 

Now, businesses that wish to offer continuing service contracts that exceed 24 months may do so as long as they inform the consumer of his or her right to end the contract.  This change allows contracts to revert to a month-to-month basis after an initial term of up to two years.  At the end of the initial term, the consumer has the right to cancel the contract, by giving the business 30 days written notice, at any time and at no additional cost. These cancellation rights must be clearly stated in the contract. 

This regulatory change continues to meet the original intent of the legislation by limiting the financial loss to consumers who enter into long-term contracts that they later wish to terminate, and by ensuring they are clearly informed of their rights in this regard. 

For further information, visit the BPCPA website at www.bpcpa.ca or call the BPCPA toll-free in BC at 1 888 564-9963.