The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court today against Telstra alleging that Telstra's local call transfer process (known within the industry as 'commercial churn') is anti competitive.
The ACCC alleges: that Telstra has required other carriers wanting to transfer customers from Telstra to use a process that requires carriers to be Telstra's debt collector; and where carriers choose not to collect Telstra's debts, Telstra imposes a fee of $15 per line, irrespective of whether or not the carrier is transferring one line or a number of lines.
'These allegations were set out in two competition notices issued by the ACCC that came into force on Wednesday 9 December 1998. In the Commission's view, Telstra has not modified the conduct described in the competition notices. The Commission's action potentially exposes Telstra to penalties of up to $20 million plus $2 million for each day the contraventions continue,' said Professor Allan Fels, Chairman of the Australian Competition and Consumer Commission, today.
The ACCC alleges that the use of a process that requires carriers to be Telstra's debt collector imposes costs on those carriers collecting moneys and substantially hinders the ability of carriers to compete with Telstra in the local telephony market.
'The Commission further alleges that, by imposing a $15 fee per line, Telstra does not allow any quantity discount for transfers of services comprising a number of lines. Where an account comprises a number of lines, the total cost of transferring can be substantial,' Professor Fels added.
The first directions hearing for this matter will be held early in the New Year.
For further information about this media release Professor Allan Fels, Chairman, ACCC (03) 9290 1812 Richard Fitzpatrick, a/g Director, Public Relations, (02) 6243 1108
The ACCC alleges: that Telstra has required other carriers wanting to transfer customers from Telstra to use a process that requires carriers to be Telstra's debt collector; and where carriers choose not to collect Telstra's debts, Telstra imposes a fee of $15 per line, irrespective of whether or not the carrier is transferring one line or a number of lines.
'These allegations were set out in two competition notices issued by the ACCC that came into force on Wednesday 9 December 1998. In the Commission's view, Telstra has not modified the conduct described in the competition notices. The Commission's action potentially exposes Telstra to penalties of up to $20 million plus $2 million for each day the contraventions continue,' said Professor Allan Fels, Chairman of the Australian Competition and Consumer Commission, today.
The ACCC alleges that the use of a process that requires carriers to be Telstra's debt collector imposes costs on those carriers collecting moneys and substantially hinders the ability of carriers to compete with Telstra in the local telephony market.
'The Commission further alleges that, by imposing a $15 fee per line, Telstra does not allow any quantity discount for transfers of services comprising a number of lines. Where an account comprises a number of lines, the total cost of transferring can be substantial,' Professor Fels added.
The first directions hearing for this matter will be held early in the New Year.
For further information about this media release Professor Allan Fels, Chairman, ACCC (03) 9290 1812 Richard Fitzpatrick, a/g Director, Public Relations, (02) 6243 1108