Fed: Govt accused of gagging Telstra s rivals

AAP General News (Australia)
08-23-2000
Fed: Govt accused of gagging Telstra s rivals

GUNNEDAH, NSW, Aug 23 AAP - The federal government was today accused of gagging telephone
companies keen to bid for a $150 million project to provide untimed local phone calls
to the bush.

New telecommunications company Heartland Communications said it had received a letter
from the Department of Communications warning it against making any public comment on
bids for the project.

Heartland chairman and former National Party leader Charles Blunt warned the government,
as the majority shareholder of major carrier Telstra, it had to be careful to keep its
hands clean in how it handled the untimed local call tender process.

The government also must be scrupulous in its dealings on another project to open Telstra's
monopoly on providing basic telephone and data services to the bush to competition.

Other carriers will bid for the right to provide services under the universal service
obligation,(USO).

"We think it's important that everybody come to this debate with clean hands and that
includes the government," Mr Blunt told reporters in Gunnedah in northern NSW.

"Can I just say that the government remains the majority shareholder in one of the
significant carriers that has also a strong interest in these upcoming tenders."

Mr Blunt said the letter put Heartland at a major disadvantage because its telephone
and Internet services, launched today, relied on two-way satellite, a technology not widely
understood by Australian consumers.

He said the department's warning also could put Heartland, owned by listed company
Maxis Corporation Ltd, in conflict with public disclosure rules imposed by the Australian
Stock Exchange (ASX).

"We have an obligation under ASX listing rules to keep the market fully informed of
any commercial development of significance to the share price and investment decisions,"

Mr Blunt said.

"Now that involves any major plans the company may have for major tenders or contracts.

"The USO could be quite fairly described as a significant commercial undertaking and
we would find ourselves in conflict with the ASX."

AAP kmh/fh/daw/bwl

KEYWORD: USO BLUNT

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