Telstra poster
A man and power lines are reflected in a Telstra poster adorning a public telephone in Sydney, Australia, August 13, 2015. Australian telecoms giant Telstra Corp Ltd on Thursday posted a 1 percent slide in full-year net profit, in line with expectations, and forecast modest earnings growth in the current year. Reuters/David Gray

Australia’s telecommunication giant Telstra has decided to take the Australian Competition and Consumer Commission (ACCC) to federal court as the former believes that the regulator has made a wrong verdict by reducing its wholesale online prices.

In October, the ACCC announced to cut the charge that Telstra demanded from its competitors in lieu of their need for the company’s copper phone network by 9.6 percent.

“In our view, the decision does not follow the ACCC’s own fixed pricing principles that require Telstra to be given the opportunity to recover from wholesale customers the costs of providing services to them,” the company said in a statement. A spokesperson added that the company believed that court was the only place where clear justification could be obtained on this matter.

The ACCC asked Telstra to reduce its wholesale price for its phone and Internet rivals using its copper phone network by 9.6 percent. In a statement in June, the ACCC said that the decision would advocate a uniform downfall of the access prices by 9.6 percent for seven access services. The new prices would be applicable from Oct. 1, 2015 to June 30, 2019.

As far as Telstra’s point of view is concerned, the telecom giant aimed at maintaining Australia’s copper phone lines irrespective of customers’ switch over to the national broadband connection. This would enable the telecom industry to make its system more organised. However, to ensure this could easily be done, Telstra planned to raise the costs by 7.2 percent.

ACCC chairman Rod Sims told Fairfax Media that it was Telstra’s right to seek judicial justification when it’s not convinced by the regulator’s verdict. “We’re conformable with Telstra seeking judicial review as is their right,” he said, adding, “Our decision on wholesale access prices, however, did apply to the fixed principles for the declared fixed-line services and it did take into account the unique circumstances of the transition from Telstra’s copper network to the NBN.”

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