INFRINGEMENT NOTICE

NOtice under section 572E of the TELECOMMUNICATIONS ACT1997

TO:Telstra Corporation Limited

ACN 051 775 556

OF:Level 41, 242 Exhibition St

Melbourne Victoria 3000 Australia

Attention: Mr David Thodey, Chief Executive Officer

I, Chris Chapman,Chair of the Australian Communications and Media Authority (the ACMA), am anauthorised infringement notice officer under the Telecommunications Act 1997 (the Telecommunications Act).

I have reasonable grounds to believe that Telstra Corporation Limited (Telstra) has contravened section 101 of theTelecommunications Act being acivil penalty provision(the contravention).Details of the contraventionare outlined below.

I give youthis Infringement Notice under section 572E of the Telecommunications Act 1997 in relation to the contravention.

The penalty payable under this Infringement Notice in relation to the contravention is $510,000 (equivalent to 3000 penalty units).

In giving this Infringement Notice I have had regard to the Telecommunications (Infringement Notices) Guidelines 2011 made by the ACMA under subsection 572M(2) of the Telecommunications Act.

Details of the contravention

  1. Telstra is a carriage service provider and is therefore a service provider(section 86 of the Telecommunications Act).
  2. A service provider must comply with the service provider rules that apply to the provider (subsection 101(1) of the Telecommunications Act).
  3. The service provider rulesinclude the rules set out inSchedule 2 to the TelecommunicationsAct (subsection 98(1) of theTelecommunications Act).
  4. Clause 1 of Part 1 of Schedule 2 to the Telecommunications Act provides that a service provider must comply with the Telecommunications Act, which for the purpose of that clause, includes the Telecommunications (Consumer Protection and Service Standards) Act 1999 (the TCPSS Act).
  5. The Telecommunications (Customer Service Guarantee – Retail Performance Benchmarks) Instrument (No. 1) 2011 (theCSG Benchmarks Instrument) is made under subsection 117B(1) of the TCPSS Act. It commenced on 1 October 2011.
  6. The CSG Benchmarks Instrument sets minimum performance benchmarks in relation to compliance by carriage service providers with a standard in force under section 115 of the TCPSS Act.
  7. The Telecommunications (Customer Service Guarantee) Standard 2011 (the CSG Standard) is made under section 115 of the TCPSS Act. It commenced on 4 October 2011 and applies to Telstra as a carriage service provider.
  8. Subsections 6(2) and 6(3) of the CSG Benchmarks Instrument set minimum benchmarks for the purposes of section 117B of the Act in relation to compliance by carriage service providers with the ‘connection period performance standard’ (subsection 6(1)).
  9. Under paragraph 6(3)(a) of the CSG Benchmarks Instrument, qualifying carriage service providers that meet the urban area services thresholdfor a benchmark period must comply with the connection period performance standard in respect of at least 90 percent of the total number of new connection requests from customers in urban areas that:
  10. are subject to the connection period performance standard; and
  11. are required to be complied with by the carriage service provider during the benchmark period,

(the 90% Urban Connections Benchmark).

  1. As defined in subsection 3(1) of the CSG Benchmarks Instrumentthe connection period performance standard means in respect of a new connection request:
  2. the standard at subsection 8(3) of the CSG Standard; or
  3. if an arrangement of the kind mentioned in section 9 of the CSG Standard is in place - the standard provided for by that arrangement.
  4. A benchmark period is a financial year (subsection 3(3) of the CSG Benchmarks Instrument).
  5. For the benchmark period 1 July 2012 to 30 June 2013 (the 2012-2013 Benchmark Period)Telstra was a qualifying carriage service provider (section 4 of the CSG Benchmarks Instrument) and met the urban area services threshold (subsection 5(1) of the CSG Benchmarks Instrument).
  6. Telstra was therefore required to meet or exceed the 90% Urban Connections Benchmark for the 2012-2013 Benchmark Period (subsection 117C(2) of the TCPSS Act).
  7. On 23 August 2013, in accordance with the Telecommunications (Customer Service Guarantee) Record-Keeping Rules 2011, Telstra provided information to the ACMA about its performance against the CSG Benchmarks Instrument for the 2012-2013 Benchmark Period.
  8. The information provided by Telstra disclosed that for the 2012-2013Benchmark Period Telstra’s performance against the 90% Urban Connections Benchmark was 88.6%. Telstra therefore failed to meet that minimum benchmark.
  9. In failing to meet the 90% Urban Connections Benchmark, Telstra contravened subsection 117C(2) of the TCPSS Act and in doing so, failed to comply with the service provider rule set out in clause 1 of Part 1 of Schedule 2 to the Telecommunications Act.
  10. Failure to comply with the service provider rules is a breach of the Telecommunications Act (section 101).
  11. Having regard to the above, I have reasonable grounds to believe that Telstra has contravened acivil penalty provision, being section 101 of the Telecommunications Act.
  12. Under subsection 572E(6) of the Telecommunications Act, where a contravention of section 101 consists of a breach of the service provider rule set out at Part 1 of Schedule 2 and a breach of another provision of, relevantly, the TCPSS Act, an infringement notice may only be given in relation to the contravention of section 101 if:
  13. the other provision that was contravened is a listed infringement notice provision; and
  14. that provision has been a listed infringement notice provision for at least 3 months before the date on which the contravention is alleged to have taken place.
  15. Subsection 117C(2) of the TCPSS act is a listed infringement notice provision (Schedule 1 to theTelecommunications (Listed Infringement Notice Provisions) Declaration 2011). Subsection 117C(2) has been a listed infringement notice provision since 16 November 2011.
  16. I have reasonable grounds to believe that Telstra has contravened section 101 of the Telecommunications Act as a result of contravening subsection 117C(2) of the TCPSS Act, a listed infringement notice provision, andhave therefore decided to give Telstra this infringement notice in relationto that contravention.

Penalty payable under this Infringement Notice

On 11 February 2012 the Telecommunications (Infringement Notice Penalties) Determination 2012 (thePenalty Determination) commenced. The Penalty Determination is made under subsection 572G(2) of the Telecommunications Act. In accordance with the Penalty Determination, the penalty payable under this Infringement Noticefor the failure by Telstra to meet a minimum benchmark set under the CSG Benchmarks Instrument by less than 2 percentage points is$510,000(3000 penalty units) (Item 6 of Schedule 2 to the Penalty Determination; subsection 4AA(1) of the Crimes Act 1914).

Time for payment of the penalty

The penalty should be paid within 28 days after the day on which this Infringement Notice is given to you.

Payment may be made by cheque or money order made payable to the Australian Communications and Media Authority and sent to:

Tony Allen

Chief Financial Officer

Australian Communications and Media Authority

PO Box 78

Belconnen ACT 2616

You may also deposit directly into our administered bank account, details as follows:

Bank: ANZ

BSB: 012-951

Account Number: 8379-24272

Name: ACMA Official Administered Receipts Account

Please advise the ACMA when payment is made by email to:

You may ask for additional time to pay. Any request should be made to the ACMA contact officer identified belowas soon as possible, and no later than 28 days after the date this Infringement Notice is given.

Details of ACMA contact officer

Tony Allen

Chief Financial Officer

Phone: (02) 62195579

Email:

Mail: PO Box 78

Belconnen ACT 2616

If the penalty is paid

If you pay the penalty specified in this Infringement Notice within the time for payment (being within 28 days after the day on which this Infringement Notice is given or within the longer period allowed) and the Notice is not withdrawn, the matter will not be dealt with by the Federal Court under Part 31 of the Telecommunications Act. Your liability for the alleged contravention, the subject of this Infringement Notice, is discharged. No further proceedings will be taken with respect to the alleged contravention.Payment does not equate to a finding that the contravention occurred. Payment is not an admission of liability.

If the penalty is not paid

If you do not pay the penalty within the time for payment the ACMA may take action for the alleged contravention.

That action may include the institution of civil penalty proceedings in the Federal Court. The penalties that the Court can impose are potentially significantly higher than that in an Infringement Notice, being up to $10,000,000 for each contravention by a body corporate (see section 570 of the Telecommunications Act).

Withdrawal of the Infringement Notice

The ACMA may withdraw this Infringement Notice. It may do so of its own volition or upon your request. To be effective the withdrawal must occur within 28 days after the Infringement Notice was given.

If you wish to apply for withdrawal of the Infringement Notice, you should write as soon as practicable setting out the basis/reasons for the request. Your application should be addressed to the ACMA contact officer in the first instance.

If the Infringement Notice is withdrawn after the penalty is paid, the penalty will be refunded.

Please note that if this Infringement Notice is withdrawn, the ACMA may consider taking action for the alleged contravention(s), the subject of this Infringement Notice.

Enquiries concerning the Infringement Notice

If you have any enquiries or questions about this Infringement Notice please contact Paul White, Executive Manager, NBN and Industry Monitoring Branch on (03) 9963 6939 or by email to .

______

Signature

Chris Chapman

Chair, Australian Communications and Media Authority

Authorised Infringement Notice Officer under the Telecommunications Act

This ______day of November 2013.

Infringement notice number: Telstra 2013-001

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