ComCom gets on Telecom's case after IOG ruling

IOG decision leads to Commerce Commission investigation

The Commerce Commission has launched an investigation following a finding by the Independent Oversight Group’s (IOG) last week that wholesale loyalty offers were a "non-trivial" breach of Telecom's separation undertakings.

In a statement released today, the commission says it expects to issue a decision by 9 October on whether or not any enforcement action is required.

If a breach of the undertakings has occurred, the High Court may issue remedial orders and/or monetary penalties and damages, the statement says.

The commission adds that it has received a complaint regarding the same loyalty offers under the Commerce Act. It has not yet decided whether to commence a separate investigation of that complaint.

The separation undertakings have effect as a deed given by Telecom to the Crown under Part 2A of the Telecommunications Act 2001 on 25 March 2008. They required Telecom to establish an Independent Oversight Group (the IOG) to monitor Telecom’s compliance with the Undertakings.

The IOG's decisions are not binding on the commission.

The commission itself cannot penalise an individual or a company – it is up to the courts to impose penalties. If the commission finds that Telecom has failed to comply with the Separation Undertakings, it may request that the High Court impose penalties of up to $10 million for the breach, plus $500,000 per day for breaches continuing after the decision by the High Court.

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