ACCC: Could Act Against Telstra Over Wholesale Broadband
March 20, 2002
FROM THE ARCHIVES: March 20, 2002
DOW JONES NEWSWIRES
SYDNEY -- Australia's competition watchdog said Thursday it may take legal action if Telstra Corp. (TLS) fails to adhere to the Trade Practices Act 1974.
The Australian Competition & Consumer Commission claimed last year that Telstra was engaging in anticompetitive conduct in the way it treated its wholesale broadband customers. Telstra was given time to rectify the problem.
"As of today, competitors have the ability to seek damages from Telstra, and it is open to the ACCC to take action against Telstra in the Federal Court with a view to obtaining substantial penalties," said the ACCC in a statement.
The ACCC said it was "disturbing" that Telstra still hasn't offered the ADSL broadband technology that was requested by wholesale customers more than a year ago.
"Telstra seems to be favoring its own retail business while continuing to delay services needed by its wholesale customers to enable them to compete with Telstra's retail business," the watchdog said.
Separately, the ACCC has closed its long-standing investigation into allegations that Telstra refused to "continue historic models of handing over data calls to the networks operated by Telstra's competitors."
"The ACCC has received advice that (the) industry has established satisfactory interim arrangements prior to the migration of all data calls onto next-generation IP (Internet Protocol) networks," said the watchdog.
Around 0006 GMT, Telstra shares were down 5 cents, or 0.9%, at A$5.35 with just under 5 million shares having changed hands on the Australian Stock Exchange.
-By Lilly Vitorovich; Dow Jones Newswires;
61-2-8235-2963; lilly.vitorovich@dowjones.com
ACCC Commissioner Rod Shogren told Dow Jones Newswires that Telstra has been very slow in resolving the wholesale broadband issue despite the watchdog warning the company in September that it believed Telstra was engaging in anticompetitive conduct.
"Our patience is wearing rather thin," he said, adding that legal action is a strong possibility but that no final decision has been.
"We're not racing off to court, but we'll be monitoring the situation," Shogren said. "If something doesn't happen very quickly, then we will have to look at going to court."
Telstra may be liable for a maximum fine of A$10 million, and an additional A$1 million a day from March 21, if the ACCC can prove Telstra's anticompetitive behavior, Shogren said.
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Updated March 20, 2002 7:12 p.m. EDT
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