The telecom regulator has effectively ruled that the longer-length deals could prevent customers from being free to take up offers from new companies Airtel and the Cable & Wireless (C&W) Sure service when they launch their competing networks.
But Jersey Telecom (JT) managing director Bob Lawrence says the decision means that mobile users now have less choice.
JT introduced the 18-month deals in April to give customers cheaper, or in some cases free, facility-rich handsets in return for a longer period of guaranteed service with the company.
He said 18-month contracts were standard in the UK and available to customers in Guernsey.