The Commerce Commission has decided to prosecute Telecom and its subsidiary Xtra for alleged breaches of the Fair Trading Act, in relation to the Go Large broadband promotion.

In 2006 Telecom and Xtra undertook extensive nationwide advertising of a new broadband plan called “Go Large”, in which it made a number of representations, including ‘“Xtra Broadband is about to be unleashed!”, “unlimited data usage and all the internet you can handle” and  “maximum speed internet”.

In December 2006 the Commission launched an investigation following complaints from Xtra customers.

The Commission has decided to prosecute Telecom and Xtra for alleged breaches of the Fair Trading Act in that the companies allegedly engaged in conduct that was liable to mislead the public as to the characteristics of services and made false or misleading representations about the performance characteristics of the Go Large plan.

There will be no further comment as the matter is now before the courts.

Background

Fair Trading Act

Breaches of the Fair Trading Act may result in prosecution in court. Companies found guilty of breaching provisions of the Fair Trading Act may be fined up to $200,000 and individuals up to $60,000. Only the courts can decide if a representation has breached the Fair Trading Act.