The Australian Competition and Consumer Commission today fined Telstra Corporation Ltd $A40 million for refusing rival operators access to its telephone exchanges several times. The fine was imposed by ACCC under the Telecommunications Act and Trade Practices Act.

Telstra could have been penalized far more than $A40 million but escaped as it admitted its mistake.

The Australian competition watchdog said today in the final submission to Justice Middleton in the Federal Court in Melbourne that it wants to impose at least $A1 million penalty each time Telstra refused a competitor access to its telephone exchanges. The commission's lawyers claim Telstra should be fined because it had a reckless disregard for its obligations.

The watchdog also criticized the Telstra management's antagonistic attitude to industry regulations. Reportedly, Telstra had breached the federal law for minimum 27 times.

Under the Telecommunications Act and Trade Practices Act, Telstra could have been fined up to $10 million for each of the 27 contraventions cited. But the competition watchdog demanded smaller fines as Telstra admitted it mistakenly rejected applications.

Telstra said that its junior staff were acting inappropriately rather than following official policy. The telecom operator also said that it has improved staff training and the processes for assessing telephone exchanges.