It may seem strange that a Geomarketing company should dedicate itself to a subject like this.
It turns out that, unfortunately, we have been faced with many cases of clients who would like to migrate to our platform, but find themselves trapped by contractual devices of the current supplier.
Such as the forecast of automatic renewal
When used in good faith, this mechanism meets the interest of the parties to preserve the scope and commercial conditions, without the need to sign a new contract.
But in the hands of malicious suppliers, it becomes a trap, used to impose new full terms, extended notice periods, and disproportionate fines.
That's why we decided to create this guide with guidelines on how to get out of this situation and even reverse the scenario in your favor.
Starting with the basics
O Article 473 of the Civil Code says that any continuous execution contract, such as the provision of services, licenses, subscriptions, can be terminated, provided that prior notice compatible with the other party's investments is respected.
It is possible to understand that the repayment period for investments is given by the initial term of the contract, automatic renewal being the continuation of the provision of the service already free of this commitment.
Thus, the attempt to block the possibility of leaving, creating new loyalty cycles, such as a requirement of 90 days for notice and a full fine even after the initial period has been completed, can be understood as an attempt to punish those who decide to cancel.
Questions and answers
When is the best time to request a cancellation?
The sooner, the better.
By formally stating your intention to cancel, you generate some immediate benefits:
- By suspending the effects of automatic renewal, the asymmetric advantage for the supplier ends
- Even if they have not yet decided to migrate to another solution, merely disarming the renewal mechanism gives them room to negotiate conditions and clauses in a possible new term
- If the decision is actually to end the contract, by notifying earlier, you will have more time for discussions, avoiding surprises with deadlines and fines.
Is it enough to send an email or does it need to be a formal notification?
If the provision of the service is digital and the contract was digitally signed, an electronic communication, with confirmation of receipt by the other party, can be considered as valid evidence.
The important thing is to be able to prove two things:
- You expressed your intention not to renew
- The other party received the message.
What if the company continues to use the service for a while longer?
This does not mean agreement, as long as the opposition is registered.
For example, send a communication stating that you will comply by the current deadline, but without adhering to the renewal conditions.
Thus, you protect yourself from malicious interpretations such as “if you continued using it, then you tacitly accepted it”.
Is it possible to cancel even with a fine?
This advice is essentially commercial, and it is more interesting to seek appropriate legal advice when there is an intention to contradict a contractual provision.
Even so, there are understandings that indicate that requiring full payment of the remaining term, during the term of automatic renewal, may be characterized as a measure contrary to good faith.
Can the company charge for the months following the notification?
After the initial term, unless the contract involves investment or unrecoverable cost, the ideal would be to release the client after 30 days of notice.
In order to avoid surprises in the cancellation process, it is essential to request a detailed statement of financial obligations by the end of the term.
We have seen cases of clients who immediately declared their conviction to terminate the contract and were surprised by additional fines and deadlines.
Therefore, the best time to request this extract is during the phase in which the company is still trying to keep you as a customer, so it will be in doubt between showing its teeth or wagging its tail.
What to do if the other party ignores the warning?
In general, the first reaction is friendly, they will try to reverse your decision.
Be aware if they responded to the cancellation message or used means that allow them to deny knowledge, such as sending a new message, just talking on the phone.
Insist that they acknowledge receiving the message asking for cancellation before any other conversation.
If nothing else works, you can still send a second notification reinforcing that the omission will be interpreted as agreeing to the closure.
How to avoid this problem in the future?
Some tips:
- Prefer suppliers who understand the continuity of service provision as a result of their quality
- Reject automatic renewal clauses with no possibility of early cancellation within the next term
- Keep the deadline of Advance notice in 30 days
In a practical way, we prepared this model of Request for contract cancellation, which follows the recommendations expressed here.
Remember that they are suggestions without the burden of legal advice, always seek the guidance of qualified professionals.
The last nail
As beneficial as it may be for us to see competitors basking their reputation on malicious moves, we regret that these practices compromise the segment.
Use contractual subterfuge to reverse a business decision it is the path of those who have given up on providing good service.
This article is our expression of rejection of such practices.
Well served here, always served
Those who serve well always serve