The Australian Competition and Consumer Commission (ACCC) is taking legal action against Telstra, Optus and TPG in the Federal Court of Australia for making false and/or misleading representations over advertised NBN plan speeds.
The ACCC claims that hundreds of thousands of consumers were misled about the maximum speeds they could receive for Fibre to the Node (FTTN) connections. The aforementioned companies failed to test the maximum speed of connections, notify consumers of underperforming speeds, and offer remedies for underperforming speeds that were challenged by consumers. Moreover, the ACCC alleges that the companies accepted payments for certain NBN plans knowing that those plans were not actually available to consumers at the promised speed.
The ACCC is challenging this issue so fiercely due to their 2017 guidance for the advertisement of NBN broadband plans in Australia. Following this guidance, Telstra, Optus and TPG provided court-enforceable undertakings to comply with these advertising standards and offer consumers remedies if specific plans could not achieve advertised speeds. Additionally, the undertakings mandated that the companies regularly perform maintenance checks on the maximum internet speeds and inform consumers if the plans did not meet the speed in their listed plan. However, it was reported that between 2018 and 2020, consumers continued to pay for plans for speeds for lower than promised speeds and the ACCC instituted proceedings against Telstra and Optus for false and misleading representations.
Presently, Telstra, Optus and TPG are breaching their undertakings by allegedly listing false or misleading statements on the company’s websites and email newsletters to consumers. Generally, these statements refer to a delay before maximum speeds can be achieved and options to move plans without breaching contracts. The ACCC believes that none of these companies has adequate measures in place to perform speed checks or offer remedies to consumers. Since the NBN market is so heavily monopolised around these major companies, the ACCC is seeking strict court orders and enforcement, including declarations, injunctions, pecuniary penalties, publication orders, and compliance programs.