Telstra pays $1.5m penalty after breaching customer rights
Telstra Corporation Ltd has paid over $1,500,000 in penalties to the Australian Communications and Media Authority (ACMA) after failing to let their consumers keep their phone numbers after switching telcos.
When Telstra suspended most of its local number porting operations from late March 2020 due to the impacts COVID-19 had on its offshore operations, over 42,000 services were prevented from moving from Telstra to other telcos and vice versa.
The company did not fully resume porting operations until July 2020 and did not clear its backlog of requests until October 2020. ACMA then discovered that the telco was cancelling transfer requests that were scheduled to occur while stopping the acceptance of new requests without prior warning to other telcos.
The company’s actions have left other telcos unable to help their new and existing customers in transferring their service while keeping their phone number.
ACMA Chair Nerida O’Loughlin said Telstra’s actions had wide-reaching and lengthy impacts on residential and business consumers, as well as the broader telco industry.
“Australian consumers must have the freedom to change their telco provider to take up services that best suit their needs. This includes keeping your own phone number even if you take your business elsewhere,” ACMA Chair O’Loughlin said.
“Local number porting is important for consumers and supports a competitive telco sector.”
ACMA Chair O’Loughlin said that although they took into account the difficulties the company had during COVID-19, it was clear that Telstra did not place sufficient plans to comply with an important consumer safeguard that promotes competition in the telco market.
“Telstra was on notice that the ACMA took these consumer and competition measures seriously and would not be exercising regulatory forbearance for non-compliance. Telco business continuity processes must be robust, particularly after the challenges of the past year,” she said.
The ACMA also gave Telstra a formal direction to comply with the Local Number Portability Industry Code. If Telstra does not comply with it, it would face court-imposed penalties of $250,000 per contravention.