Telstra, NBN Co back in court this April

$200 million at stake over 30 years

Telstra and NBN Co disagree on how to interpret their contract.

Telstra and NBN Co disagree on how to interpret their contract.

NBN Co and Telstra will this April resume their argument over consumer-price-index (CPI) adjustments in the companies’ $11 billion agreement.

In a directions hearing this morning, the NSW Court of Appeal decided to schedule the case for 9 and 10 April.

The dispute relates to the agreement in which Telstra agreed to migrate its customers to the NBN and decommission its copper network, as well as allow NBN Co access to its pits, pipes and ducts. The parties have disagreed over when CPI adjustments apply to the price that Telstra charges NBN Co to access its infrastructure.

The agreement between Telstra and NBN Co allowed for CPI increases from the first of January every year after the commencement of the agreement. However, Telstra and NBN Co have disagreed over the precise date that the agreement commenced.

The agreement was signed in June 2011, so Telstra had argued that CPI increases should take effect from 1 Jan 2012. However, NBN Co had argued that the agreements were only finalised in March 2012, and so the CPI start date should be 1 Jan 2013.

The difference, depending on when CPI adjustments began, is estimated to be worth $200 million over 30 years.

In July this year, the NSW Supreme Court ruled in favour of Telstra. However, one month later, NBN Co appealed the decision to the NSW Court of Appeal.

NBN Co is also currently waging battle in the NSW Supreme Court with Pipe Networks, a TPG subsidiary, over TPG’s planned fibre-to-the-basement (FTTB) rollout that will compete with the National Broadband Network.

A directions hearing in that case is scheduled for 7 November.

Adam Bender covers telco and enterprise tech issues for Computerworld and is the author of dystopian sci-fi novels We, The Watched and Divided We Fall. Follow him on Twitter: @WatchAdam

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Tags CPI adjustmentsNSW Court of AppealNSW Supreme Courtnbn conational broadband networkcourtTelstracourtsbroadbandNBN

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