The competition watchdog has rejected Telstra's proposed charges for connecting and disconnecting broadband Internet service providers' access to its basic copper wire.

Telstra had proposed a connection charge of $90 and disconnection charge of $90 for its line sharing service (LSS).

The LSS provides access to part of the basic copper wire of Telstra's network, allowing competing carriers to provide their own broadband services to end-users while Telstra continues to provide voice services.

"The ACCC's final decision is to reject Telstra's connection and disconnection undertaking for the LSS", ACCC chairman Graeme Samuel said in a statement today.

"The ACCC is of the view that Telstra's proposed connection and disconnection charges are not reasonable".

The ACCC said the charges were well above what was appropriate for the service and the separate disconnection fee should not be levied at all in some cases.

A spokesman for Telstra said the ACCC had missed the deadline for responding to the undertaking and the telco would stick by its price.

By law, the competition watchdog had six months in which to accept or reject the telco's undertaking, but instead took 16 months.

"The undertaking is therefore deemed to have been accepted," the Telstra spokesman told AAP.

He said the $90 charge reflected the cost of having someone go to an exchange and physically switch a customer across.

"If the ACCC can find some way of doing it for less, we'd like to hear about it," the spokesman said. "The extraordinary delay and lack of real detail around this announcement today underlines how regulatory red tape is seriously hindering investment in the telecommunications industry."