International Law

The High Court today handed down a rare unanimous joint judgment dismissing Telstra's constitutional challenge to the ACCC.  Read the judgment here.  This is how The Australian summarised the decision:

THE High Court of Australia today threw out Telstra's constitutional challenge against the competition watchdog's powers to set prices for access to its networks by rivals.

Telstra launched the challenge in January 2007, after the Australian Competition and Consumer Commission ruled that the telco should give its rivals access to certain parts of its network for $3.20 a month.

"The telecommunications access regime set out in the Trade Practices Act did not amount to an acquisition of Telstra's property," the High Court said in its judgment.

The decision was unanimous and the court ordered Telstra to pay costs.

Shares in Telstra fell 1.3 per cent to $4.49 in early trade, as the benchmark S&P/ASX200 index gained 0.5 per cent.

Telstra had claimed that the ACCC's actions force it to give rivals access to its network, which it believed breached the Constitution.

The Constitution prevents the Government from taking property without providing "just" compensation.

"The rights in Telstra's assets were rights to use the assets in connection with the provision of telecommunications services, but those rights were always subject to a statutory access scheme which permitted other carriers to use the assets," the court said.

"Telstra had always owned and operated the assets within a regulatory regime by which other carriers have the right to connect their facilities to Telstra's network and to obtain access to Telstra services."

The challenge required the court to rule that the Trade Practices Act was in breach of the Constitution because it gave the ACCC price-setting powers.

Read more here.