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ACMA takes Red Telecom to court for allegedly failing to comply with TIO orders

The ACMA is seeking penalties of up to AU$10 million for each contravention.
Written by Aimee Chanthadavong, Contributor

The Australian Communications and Media Authority (ACMA) has commenced Federal Court proceedings against Sydney-based telco Red Telecom and its sole director Nicholas Kontaxis, alleging there was a failure to comply with decisions made by the Telecommunications Industry Ombudsman (TIO).

The ACMA, which is responsible for ensuring all telcos in Australia comply with decisions made by the TIO, has alleged Red Telecom failed to comply with the TIO's order to pay customers more than AU$63,000.

As part of the court proceedings, the ACMA is seeking Federal Court penalties of up to AU$10 million for each contravention of telco laws by the corporation, and up to AU$50,000 for each contravention by an individual.

Red Telecom was one of three telecoms previously formally warned to comply with the Telecommunications Consumer Protections (TCP) code in 2018, as part an audit carried out by the ACMA.

At the time, the ACMA also found that 41 telcos were not providing consumers with the minimum complaints-handling information required under a new National Broadband Network standard.

Last July, the ACMA agreed to a revised TCP code that came into effect on 1 August 2019.

ACMA said repeat non-compliance by telcos would lead to "significant consequences" with penalties up to AU$10 million for not following directions from the ACMA.

"The new TCP Code puts the onus on telcos to ensure customers understand what they are buying. We will be subjecting telcos to close scrutiny as to how well their practices conform with the new Code," said ACMA Chair Nerida O'Loughlin at the time.

Under the code, the Communications Alliance also expanded its quarterly Complaints in Context report.

The first "expanded" version of the report was released in December where MyRepublic was crowned as the most complained about telco, with 42.2 complaints per 10,000 services compared to the average 6.8 complaints per 10,000 services. 

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