Telstra proposes equal power for ACCC and ITA

The move follows concern from both industry and the competition watchdog that the Adjudicator would favour Telstra

Telstra has proposed changes to its structural separation undertaking (SSU), which the Australian Competition and Consumer Commission (ACCC) and the Independent Telecommunications Adjudicator (ITA) would share equal resolution powers to alleviate concerns that the latter would favour the telco.

The telco detailed the proposed changes in a discussion paper, which noted dissatisfaction from both industry and the competition watchdog around the original SSU’s resolution measures.

“The feedback received from industry stakeholders indicated continued concerns about the future independence and operation of the ITS,” the discussion paper reads. “The ACCC also questioned whether there would be an effective dispute processes in place under the SSU in the event that wider industry participation in the scheme did not occur.”

Following this, the telco has suggested granting “parallel” power to both the ACCC and the ITA under the SSU, which wholesale customers would choose which party to refer disputes to.

“In effect, if a wholesale customer has concerns about the independence of the ITA, this would make the ACCC available as an alternative,” the paper reads.

According to the paper, having the ACCC as an alternative would provide incentive for the telco to ensure the ITA is credible and independent.

Should the ACCC be the adjudicator, it would have the power to determine its own process for disputes including fees incurred for referring the dispute to the watchdog, while the ITA process would allow wholesale customers to elect whether directions are binding or non-binding at the time of referring the dispute.

“Wholesale customers would need to make an upfront choice about whether they wish to be bound to fix issues on their side,” the paper reads.

“If a wholesale customer wishes to enforce the determination against Telstra, the customer would also accept that the determination can equally be enforced by Telstra against it.

“On the other hand, if the wholesale customer did not wish to be bound by a determination, it would also have to accept that the determination would not be binding on Telstra.”

Both adjudicators would also be given the authority to give directions to the telco to change systems and processes, the scope of which would be governed by existing monetary caps provided under the ITA process. This would also be limited to situations in which the adjudicator is not satisfied that the proposal put forward complies with the determined directions.

Telstra shareholders recently voted almost unanimously in favour of the $11 billion financial heads of agreement with NBN Co, following two year of negotiations around the deal.

Based on both the proxy and direct votes made at the company’s annual general meeting, the company has received the support of 99 per cent of shareholders.

Tags Australian Competition and Consumer Commission (ACCC)financial heads of agreementDavid Thodeystructural separationnbn coIndependent Telecommunication Adjudicator (ITA)Telstra

More about Australian Competition and Consumer CommissionAustralian Competition and Consumer CommissionTelstra Corporation

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