News - "BT Fined £42M for breach of contract"
BT Fined £42M for breach of contract Posted 29 Mar 2017 12:12:00
BT will be fined £42m for a serious breach of Ofcom’s rules, after the company reduced compensation payments to other telecoms providers for late installations.
- Ofcom investigation finds BT cut its compensation payments for delays in connecting high-speed business lines
- These important networks underpin the UK’s communications infrastructure
- BT has admitted failings, and agreed to compensate the companies affected
The penalty is a result of an investigation by Ofcom into BT’s network arm, Openreach.
Ofcom opened the investigation in November 2015 shortly after Vodafone brought allegations to Ofcom that BT had misused its contractual terms through the late delivery of Ethernet services without Vodafone’s consent, and by failing to compensate the company for these delays.
The investigation found that, between January 2013 and December 2014, BT misused the terms of its contracts to reduce compensation payments owed to other telecoms providers for failing to deliver ‘Ethernet’ services on time.
On top of the £42M, BT will also be fined £300,000 for failing to provide information to Ofcom. This is on top of the £300M they will have to pay in compensation after admiting failings.
According to the Telegraph, The £42m fine is by far the highest ever levied by Ofcom. The next highest telecoms fine was a £3.7m fine imposed on Vodafone last year.