Re: "Or is it a very devious arrangement"
Sublocating/sharing a connection is another thing, while limiting what you could *after* the router (if the router is rented from the provider, it's pretty understandeable you can't put anything between the router and provider cablecan be an "unfair clause" in the ToS), within reasonable, standard, common, safe practices (applying 220V to the router ports may be not) - but I don't know enough of South America consumer rights and legal system to asses it.