- The Federal Communications Commission voted to ban cable and satellite companies from charging early termination fees.
- The rule, introduced in November, will also require companies to issue a prorated credit or rebate to customers who cancel their service before the contract ends.
- "Consumers are tired of these junk fees," FCC Chairwoman Jessica Rosenworcel said.
WASHINGTON — The Federal Communications Commission on Wednesday voted to pass a measure banning cable and satellite companies from charging early termination fees.
"Consumers are tired of these junk fees," FCC Chairwoman Jessica Rosenworcel said before casting the deciding vote at an open commission meeting.
"They now have more choices when it comes to video content but these friction-filled tactics to keep us subscribing to our current providers are aggravating and unfair," Rosenworcel added. "So, today we kick out a rulemaking to put an end to these practices."
The agency first announced the proposal in late November to force cable and direct broadcast satellite providers to drop fees for canceling services before the end of a contract period.
The rule will also require service providers to issue a prorated credit or rebate to customers for days remaining in the billing cycle after cancellation.
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Two out of four commissioners voted against the measure.
Money Report
The ban on early termination fees is part of the Biden administration's initiative against excessive surcharges, or "junk" fees, which are estimated to cost consumers tens of billions of dollars, according to the White House.
Cable companies could be raking in an estimated $28 billion a year on fees, according to a 2019 brief by Consumer Reports.
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