ADVISORY: Unauthorized Utility Sales Personnel & Important UTAP / CHRA Guidance
The UTAP office has been warned of unauthorized sales personnel from utility companies, not contractually approved by UTAP, offering deceptive, lower rates. Switching utility providers requires a mandatory waiver from CHRA and carries significant financial risks, including out-of-pocket payment of the 19% German VAT and contracts that may not support PCS departures.
These representatives will ask you to sign or verbally agree to their terms and conditions. Be aware that once you sign or agree, you will not be able to withdraw your commitment.
While the initial price may seem appealing, you must carefully analyze the offer for hidden risks, including:
- Price Guarantees: Is the rate guaranteed for the full duration of the contract?
- PCS Clauses: Does the contract support a close-out upon your PCS departure?
- Rate Structure: What is the actual comparison between the base price (Grundpreis) and the price per kilowatt?
- Tax Exemption Loss: These contracts often require payment of the German 19% Value Added Tax (VAT), which is not exempted.
If you are still considering joining another utility company, you are required to obtain a waiver from the Civilian Human Resources Agency (CHRA), who may approve or disapprove the request.
If CHRA approves the waiver, they will only honor the amount without tax for your Living Quarters Allowance (LQA) submission. The 19% German tax will become an out-of-pocket expense for you.
Please ensure you and your families remain vigilant regarding these solicitations. If you have any questions, please reach out to the local UTAP office for official guidance.