Telstra Fine for Breaching Competition Laws Has Lessons For All

The $18.5 million fine imposed on Telstra by the Federal Court for breaching the Trade Practices Act and Telecommunications Act should put all business on notice to get their internal compliance systems in order, and serves as a warning that the ACCC will seek – and courts will impose – higher levels of fines for breaches.

In Australian Competition and Consumer Commission v Telstra Corporation Limited [2010] FCA 790 (28 July 2010) Telstra admitted to multiple breaches of its standard access obligations (imposed by the Telecommunications Act and its carrier licence) to permit interconnection between its facilities and those of telecommunications companies seeking access to its networks.

It also admitted to making misleading representations about its facilities' capacity to accommodate the access seekers.

What did each side think was a fair fine?

The ACCC sought $40 million in fines for these breaches, while Telstra argued for a fine of $3-5 million.

How was the fine calculated?

Justice Middleton in the Federal Court assessed the fine at $26.5 million...