The Australian Competition and Consumer Commission has commenced legal proceedings in the Federal Court against National Telecoms Group Pty Ltd.
The ACCC has alleged that NTG, and several of its subsidiaries, supply telephony packages, often marketed under the name Synergy, to small and medium sized businesses. The ACCC alleges the telephony packages generally consist of a lease on a new phone system and involve the transferring of the customer’s fixed line telephony services to Direct Telecoms, a wholly owned subsidiary of NTG. Under these NTG telephony packages, the ACCC alleges a customer pays rent for a new phone system and also may receive a rebate on their telephone bill.
The ACCC alleges that, in the course of marketing these telephony packages, NTG and its agents, made representations to customers that:
- they would pay no more, or pay only marginally more, than they were currently paying for their telephony services, if they signed up to an NTG package;
- they would receive a free phone system if they signed up to the NTG package; and
- the call rates for the telephony services provided in the NTG package would be the same or cheaper than the call rates that customer paid to their existing telephony provider.
The ACCC alleges that these representations were false and misleading in breach of sections 52 and 53 of the Trade Practices Act 1974 because, at times, customers paid significantly more for their telephony services through NTG than they did with their previous supplier.
The ACCC is seeking court orders including:
- declarations that NTG has breached sections 52 and 53 of the Trade Practices Act 1974
- injunctions restraining NTG from engaging in the same conduct in the future
- an order requiring NTG to implement a Trade Practices compliance program and an education and training program for its promoters, marketers and sellers of the NTG package
- corrective advertising, and
- costs.
The matter has been listed for a directions hearing in the Federal Court, Melbourne on 19 March.