TPG Telecom has paid $75,120 in penalties after the Australian Competition and Consumer Commission (ACCC) issued it with four infringement notices for alleged contraventions of the Telecommunications Act by failing to comply with its joint functional separation undertaking.
TPG’s undertaking includes obligations designed to ensure separation of wholesale and retail functions as required by the carrier separation rules in the Telecommunications Act.
Under the carrier separation rules, superfast network operators are required to operate on a wholesale-only basis, unless they seek an exemption from the ACCC. Therefore, a company that controls a superfast broadband network cannot supply retail services over it unless there is a class exemption or a functional separation undertaking in place.
In 2022, the ACCC accepted a joint functional separation undertaking given by TPG Telecom that sets out the division of activity between TPG Telecom’s wholesale and retail activities, while allowing them to receive shared corporate and network engineering services.
The ACCC alleged that from 31 August 2023 to 22 May 2024, TPG “failed to have measures in place to prevent staff of its wholesale and retail businesses from accessing the other’s premises unless accompanied to the extent practicable while on the premises, as required in the undertaking.”
On four occasions, a senior TPG wholesale staff member allegedly worked unaccompanied in offices where TPG retail staff were located without any physical or other security barriers separating the respective staff.
The country’s competition regulator said that staff separation obligations were intended to prevent staff from the two businesses sharing sensitive information that could favour TPG’s own retail operations over third-party retailers on its Vision Network.
It added that although there was no evidence that sensitive information was shared, the alleged conduct could potentially affect competition in relation to the supply of retail broadband services to consumers.
“This is our first enforcement action for an alleged contravention of the carrier separation rules as we continue to focus on promoting competition in essential services, such as telecommunications,” said Liza Carver, ACCC Commissioner.
In a statement shared with ChannelNews, a TPG spokesperson said, “TPG Telecom acknowledges the ACCC issuance of infringement notices related to a few occasions where a staff member worked in our offices without a physical barrier separating them from other staff as required under the related to our Joint Functional Separation Undertaking. While no sensitive information was exchanged or shared on these occasions, we have paid the infringement notices. We take our regulatory responsibilities seriously and have implemented additional measures to prevent any recurrence.”
TPG’s agreement to pay the penalty comes days after the ACCC said that it will not oppose Vocus Group’s proposed acquisition of TPG Telecom’s fixed line business, enterprise, government, and wholesale customer base as well as its fibre and transmission networks. By way of the TPG-Vocus $5.25 billion deal, Vocus will operate a network of more than 50,000km of owned or leased fiber and almost 15,000km of international submarine cables.
