The Tennessee General Assembly unanimously passed legislation protecting consumers from excessive charges when canceling service contracts for cable, internet or phone plans.
House Bill 141, sponsored byState Rep. Michael Hale, R-Smithville, prohibits service providers from billing customers for an extra billing period if the contract is canceled during the first half of a cycle.
“This legislation reaffirms Tennessee’s commitment to protecting consumers from deceptive and unfair billing practices,” Hale said. “It sets clear guidelines to ensure people only pay for services they actively use and aren’t stuck with charges for accounts they’ve properly canceled.”
If a customer cancels in the second half of a service period, providers can still charge for the remaining days and one additional full billing term. Companies that fail to follow the new rules may face penalties as outlined in the Tennessee Consumer Protection Act of 1977.
The law does not ban minimum contract terms but ensures customers are not unfairly billed after canceling service.
In 2024, the Tennessee Attorney General and Reporter’s office received 8,536 formal consumer complaints, including 520 related to internet sales.
House Bill 141 has been signed by the governor and will take effect on July 1.