ACCC reports on Telstra's compliance with its Structural Separation Undertaking

15 April 2016

The Australian Competition and Consumer Commission’s annual report on Telstra’s compliance with its Structural Separation Undertaking (SSU) has been tabled in Parliament.

The report outlines Telstra’s compliance with its SSU obligations during the 2014-15 financial year. The SSU commits Telstra to take steps in connection with the structural reform of the communications industry. These include specific measures that apply until the NBN has been completed and services have been migrated from Telstra’s fixed line access networks. Given the timeframe required to complete the NBN build, the SSU commitments are fundamental to promoting competitive outcomes during the transition period.

The report shows that Telstra continued to demonstrate a commitment to improving its level of compliance with its SSU in the 2014-15 reporting period. As a result, there has been a reduction in the number of breaches reported by Telstra during the year. The ACCC considers that Telstra’s overall level of compliance has improved during the year and Telstra has acted reasonably to redress breaches as they arise.

The small number of compliance issues identified in the report related to instances where Telstra breached its commitments to:

  • protect confidential or commercially sensitive wholesale customer information that it receives in the course of supplying regulated services from being disclosed to its Retail Business Units;
  • maintain operational and organisational separation of its wholesale, retail and network services businesses;
  • comply with some reporting requirements that are designed to promote transparency; and
  • block service orders or other requests from being processed, as required to promote migration to the NBN and to realise structural reform.

“These compliance issues largely arise due to Telstra’s legacy systems not being designed to deliver the outcomes required by the SSU, or errors made by Telstra staff in performing their day-to-day work,” ACCC Chair Rod Sims said.

“Telstra has made progress towards addressing key issues during the year, particularly in relation to its IT systems and processes to better safeguard against disclosure of protected wholesale customer information.”

The ACCC’s response to the SSU breaches has been to work with Telstra to focus on stopping the conduct, reducing its effect, and ensuring steps are taken to prevent recurrence. The ACCC has also encouraged Telstra to keep its wholesale customers informed of SSU equivalence and migration issues as they arise.

See also: Telstra's structural separation undertaking 2014-15

 

Release number: 
MR 50/16
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