Australia’s three largest internet providers must pay $33.5 million in damages, for false statements about NBN plans.
Telstra, Optus and TPG have been ordered by the Federal Court after they each admitted making false or misleading representations to consumers.
Following an investigation from the Australian Competition & Consumer Commission, Telstra must pay $15 million, while Optus has been ordered to pay $13.5 million, and TPG $5 million in penalties for breaching the Australian Consumer Law (ACL).
The order is in relation to their 50Mbps or 100Mbps fibre to the node (FTTN) plans.
A statement from the ACCC says that the statements were made to consumers on the telcos websites, in emails or in telesales.
“Telstra, Optus and TPG each promised to tell consumers within a reasonable timeframe if the speeds they were paying for could not be reached on their NBN connections,” the statement reads.
“They each also said they would offer these consumers options, including to move to a cheaper plan with a refund, if they could not achieve the maximum speed on their plans.”
Telstra, Optus, and TPG each admitted that their statements were false or misleading, in breach of the ACL, because they did not have adequate systems, processes and policies in place to ensure they would do what they said they would.
The incidents affected nearly 120,000 consumers in total and were made for at least 12 months in 2019 and 2020.
The three providers each admitted that by failing to notify consumers whose maximum attainable speeds were lower than the speed of their purchased plan, they had falsely represented to those consumers that their NBN connections were capable of attaining higher speeds.
CCC Commissioner Liza Carver says consumers must receive accurate information when choosing the best internet plan for them.
“Fast and reliable internet is a necessity for Australian households,” Ms Carver says.
“These significant penalties reflect the seriousness of the breaches of consumer laws by these large and sophisticated businesses that should be better informed about their obligations towards their customers, particularly given the promises they made to their customers and in undertakings previously provided to the ACCC regarding speed claims for their NBN plans in 2017,
“Some customers may have paid for a 50 or 100 Mbps plan believing their NBN connection could support the higher download speeds, even though they would have been better off paying for a lower speed plan.”
The ACCC has previously taken legal action against Telstra, and Optus in 2018, early 2019, and late 2019, in relation to other false and misleading statements.
