By Savannah Meacham

Misbehaving telecommunication companies will no longer be warned before being slapped with new multi-million-dollar fines for breaching their obligations to customers.

The federal government has scrapped the two-step process that can lead to major fines for telcos that breach industry standards or codes of conduct.

Currently, the Australian Communication and Media Authority must first issue a warning to encourage the company to comply no matter how serious the breach.

If there is further non-compliance then the agency can act to issue a fine.

Under the changes, the agency can act quickly to hold the companies to account and will no longer be tied to issuing a warning before cracking down on serious breaches.

To align telcos with other sectors like energy and banking, the maximum penalties for breaches of industry codes and standards will also increase from $250,000 to $10 million.

“Nobody wants an industry that sees penalties as the ‘cost of doing business’,” Communications Minister Michelle Rowland said.

“These changes provide a powerful deterrent, improve the likelihood of compliance and lead to a better-functioning telecommunications sector.”

Courts will also be able to determine the fine amount based on the financial turnover of the telco and the scale of the breach to ensure the penalty is proportionate to the harm caused.

Telco giant Optus was fined $12 million for its major network outage in 2023 when millions of customers lost phone connections and internet, meaning thousands could not contact triple zero.

ACMA’s multi-million-dollar fine was based on the seriousness of the telco’s responsibility to maintain the essential service of triple zero.

Telstra was also fined $3 million for its 90-minute outage in March 2024 where its call centre was unable to transfer more than 100 callers to triple zero.

A Carriage Service Provider registration scheme will also be established to increase the visibility of telecommunication retailers in the market.

The scheme also means the enforcement agency can stop providers from operating in the market when they’ve been found to pose “unacceptable risk to consumers or have caused significant consumer harm”.

Australian Communications Consumer Action Network chief executive officer Carol Bennett said the strengthened action will mean fore accountability, transparency and compliance in the industry.

“The Australian government’s reforms address longstanding consumer concerns about the relatively weak regulatory settings of the telco industry and will go a long way towards improving trust in the telecommunications industry,” she said.