Intervention by Australia's consumer watchdog has failed to break a stand-off between NBN, Telstra and retailers leaving homes without broadband for months.

Despite direction from the Australian Competition and Consumer Commission, Telstra Wholesale has failed to assist retailers such as TPG in restoring ADSL copper services to homes left without broadband after NBN activation failures, as revealed by Fairfax Media investigations.

"Cease Sale" regulations in the NBN migration agreement forbid Telstra Wholesale from offering new copper services in areas declared NBN Ready For Service. Both Telstra and the ACCC agree these regulations do not forbid reconnecting copper services inadvertently disconnected before an NBN service is active.

"The ACCC has advised Telstra that it has no objection to it reinstating the [affected] services," says an ACCC spokesperson.

"Telstra's migration plan permits Telstra, at its election, to reinstate services that did not successfully migrate to the NBN and so were cancelled in error."

Despite repeated requests since NBN Hybrid Fibre Coax (HFC) cable "false activations" began occurring late last year, Telstra Wholesale has not restored a single ADSL service for Australia's largest ADSL retailer TPG, says TPG chief operating officer Craig Levy.

As a result, some customers of TPG and other retailers have gone without ADSL or NBN broadband for weeks or months. TPG's situation is exacerbated by the fact it automatically issues ADSL disconnection orders to Telstra Wholesale, after receiving a completion advice from NBN, without ensuring connections are successful – to avoid paying for overlapping ADSL and NBN wholesale services.

Retailers have a five-day window in which to request an ADSL service be reconnected, according to Telstra Wholesale, yet requests have gone unheeded, says TPG's Levy.

"TPG have interfaced with Telstra at various levels, on multiple occasions, to address customers who are stuck due to Cease Sale," Levy says.

"There is a tremendous amount of red tape preventing us from re-ordering copper services where NBN activations have been problematic."

A Telstra spokesperson denies there is a deadlock and says the migration plan allows it to reconnect ADSL "in certain circumstances" – when approached by NBN or a retailer – and it has done so in the past.

"Telstra's disconnection handbook provides information for wholesale customers on how to lodge reconnection requests in these cases," says the Telstra spokesperson.

"We will obviously take a common sense approach and use our limited discretion in these situations where customers are without service for an extended period of time."

After meeting with both parties in an effort to resolve the impasse, the ACCC reassured TPG that Telstra Wholesale would cooperate, but TPG's Levy says Telstra Wholesale failed to do so until last week following Fairfax Media enquiries. Telstra Wholesale was preparing to reconnect four homes to ADSL when NBN stepped in and finally repaired their cable connections.

While accepting blame for activation failures, NBN has repeatedly insisted that Cease Sale is not a relevant issue, as has Communications Minister Mitch Fifield. Throughout Fairfax Media's month-long investigation, NBN repeatedly fast-tracked repairs to long-standing activation failures brought to its attention, rather than addressing the issue of the Cease Sale deadlock which left some of those homes without broadband for weeks or months while waiting for NBN to act.

After escalated Fairfax Media enquiries, NBN chief executive Bill Morrow discussed the issue with TPG's Craig Levy and Telstra's chief executive Andy Penn. New processes are now in place for retailers to escalate NBN connection issues, identifying another 52 cases in the last week.

All HFC cable activation issues have been resolved, according to NBN, although Fairfax Media is still aware of homes with connection issues. There is also an NBN installation backlog, with only 83 per cent of HFC areas offering installation appointments within the agreed service level of eight working days. The Cease Sale regulations prevent new residents in NBN Ready For Service areas ordering ADSL broadband while they wait for an NBN installation appointment.

As the nationwide NBN rollout approaches the half-way mark, the Cease Sale deadlock means future rollout faults could still leave homes without ADSL or NBN broadband.

Like Telstra Wholesale, NBN also denies there is a deadlock and attributes TPG's ongoing ADSL reconnection issues to a breakdown in escalation procedure. Meanwhile NBN has improved its own procedures for escalating the resolution of NBN activation issues, to prevent cases slipping through the cracks.

"We have identified a gap in our escalation process for NBN activations and are working with industry to make sure it doesn't happen again," says an NBN spokesperson.

"If there is a situation where someone is at risk of being without a service because NBN cannot be connected within a reasonable time, we will work with Telstra to reconnect them to ADSL."