The Australian Competition and Consumer Commission said in a statement on Monday that wrong claims in ads would attract higher penalties and executive who approved such advertising could face proceedings themselves.
The ACCC pointed to the fact that between March and June, the three big telcos — Telstra, Optus and Vodafone — had advertised mobile data plans with headlines claiming they offered "unlimited" data.
However all the services had speed caps which came into play after particular types of usage or else after a certain data threshold was reached.
"Vodafone’s ‘unlimited’ plan provided an initial data allowance at usual speeds, after which all usage was speed capped at 1.5Mbps; and
"Telstra’s ‘unlimited’ plans provided 40GB at usual speeds, after which all usage was slowed to 1.5Mbps and slowed further during busy periods."
All these claims were stopped after the ACCC took the companies to the Federal Court.
“Telecommunications companies should be wary of using absolute claims like ‘unlimited’ where that does not give a true picture to consumers of what is being offered,” ACCC chair Rod Sims said.
“We have taken a range of actions against telecommunication companies for misleading consumers. It is about time they showed more respect for their customers and the Australian Consumer Law.
“With much higher penalties now available for breaches of consumer law, I hope they will take their obligations more seriously. From now on consumer law penalties will seriously affect their bottom line, and we will not hesitate to seek the highest possible penalties.”