Optus and TPG to issue $6.5million in refunds under ACMA rules

Optus Internet and TPG Internet will issue $6.5million in refunds under ACMA rules for failing to inform customers of under-performing internet speeds.

Optus and TPG will pay back $4.4 million and $2.1 million, respectively, to tens of thousands of consumers who were not advised about the maximum speeds advertised in their internet plan were not attainable on the NBN infrastructure available to them.

In July 2021, Optus self-reported that over a two-year period it had failed to inform more than 34,000 customers that they were not receiving the level of service they had purchased.

While in October 2021, TPG advised the ACMA that it had failed to provide more than 4,400 customers with the notifications required.

Under ACMA rules, telcos must verify maximum internet speeds when migrating customers to the NBN and notify them when speeds cannot meet those that were originally advertised to them.

As a result of these breaches the ACMA has issued Optus with a remedial direction. TPG offered a court-enforceable undertaking to the ACMA, which it has accepted.

ACMA chair Nerida O’Loughlin said when telcos cannot deliver the internet speeds advertised in a plan, customers are entitled to move to a cheaper lower speed plan or exit the contract at no cost.

"Optus and TPG were charging these people for internet speeds they could not get," she said.

"These customers were left in the dark and denied the option to move to a cheaper contract or walk away," O'Loughlin added.

Under its remedial direction Optus is required to commission an independent audit of its relevant compliance systems and implement effective systems and governance processes to ensure future compliance.

While TPG is required to commission an independent audit of its relevant compliance systems as well as implement effective systems and governance processes to ensure future compliance, under its enforceable undertaking.

The ACMA issued Telstra with a remedial direction for similar issues in June 2021.

O’Loughlin said: "The scale of service failure by these companies is significant. Our actions will ensure the top three telcos are more vigilant delivering the internet service their customers expect and have paid for."

The ACMA can commence proceedings in the Federal Court if Optus fails to meet the requirements of its remedial direction or TPG does not comply with its enforceable undertaking.

Optus has advised that it has contacted customers covered by the Telecommunications Service Provider (NBN Service Migration) Determination 2018, and offered them the applicable remedies, including the total of over $4.4 million in refunds. As of early December 2021, TPG had refunded more than $2.1 million to customers as part of its remediation program.