Australian telephone company Optus Communications has delivered a body-blow to rival Telstra - suing it for A$900 million (about HK$5.09 billion) on the eve of its flotation.
Optus, 49-per cent owned by Cable & Wireless, filed the Federal Court action yesterday, suing for damages under the Trade Practices Act.
It claimed Telstra had engaged in an anti-competitive strategy which denied consumers the benefits of competition.
The legal action came a day after the Australian Government was forced to seek an explanation on reports about a corruption scandal from the lead manager of the float in Asia, Japanese stockbroker Daiwa Securities.
Both incidents come just weeks ahead of Telstra's proposed $12 billion stock-market listing, in which the Australian Government will sell one third of the company.
Optus chief executive Peter Howell-Davies said: 'Telstra's activities are a huge barrier to entry not only for Optus but for all new entrants in the newly deregulated industry.' An Optus spokesman said: 'We have been fighting up against this behaviour from Telstra for five years and we are saying 'enough is enough'.
In its claim, Optus alleges Telstra refused to provide number portability for customers which would allow them to keep the same phone number when they changed telephone companies.