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2002
THE PARLIAMENT OF THE COMMONWEALTH OF
AUSTRALIA
HOUSE OF
REPRESENTATIVES
TELECOMMUNICATIONS COMPETITION BILL
2002
EXPLANATORY MEMORANDUM
(Circulated by
authority of the Minister for
Communications, Information Technology and the
Arts,
Senator the Hon. Richard Alston)
TELECOMMUNICATIONS COMPETITION BILL
2002
OUTLINE
The Telecommunications Competition Bill 2002 (the Bill) makes amendments
to
Parts XIB and XIC of the Trade Practices Act 1974 (TPA) and some
amendments to the Telecommunications Act 1997 and the
Telecommunications (Carrier Licence Charges) Act 1997. Part XIB of the
TPA deals with anti-competitive conduct in the telecommunications industry and
Part XIC deals with interconnection and access to telecommunications services.
The Bill implements the Government’s response to the Productivity
Commission’s Inquiry Report on Telecommunications Competition Regulation.
The measures contained in the Bill aim to increase the level of competition and
investment in the telecommunications market to the benefit of consumers and
business by:
(a) facilitating timely access to basic telecommunications
services:
– Part 1 of Schedule 2 requires the Australian Competition
and Consumer Commission (ACCC) to produce model terms and conditions for core
telecommunications services; and
– Part 2 of Schedule 2 removes the
right to seek merits review of final determinations made by the ACCC in relation
to access arbitrations;
(b) facilitating investment in new telecommunications
infrastructure:
– Parts 11 and 12 of Schedule 2 extend the existing
provisions under Part XIC of the TPA relating to exemptions and undertakings to
cover services that are not yet declared or supplied; and
– Part 12 of
Schedule 2 encourages the industry-wide benefits of undertakings;
(c) encouraging a more transparent regulatory market:
– Part 16 of
Schedule 2 provides a mechanism for the Government to introduce greater
transparency in Telstra Corporation Limited's wholesale and retail operations;
(d) enhancing accountability and transparency of decision making under Part
XIB:
– Part 9 of Schedule 2 requires the ACCC to publish guidelines on
the exercise of its powers under Part XIB;
– Part 16 of Schedule 2
requires the ACCC to consult prior to the issue of a Part A competition notice
and enables it to issue an advisory notice whether or not a Part A competition
notice has been issued; and
(e) making a number of other changes to the telecommunications
regime:
– Schedule 1 contains a number of amendments to the
Telecommunications Act 1997;
– Schedule 2 contains a number of
amendments to the TPA; and
– Schedule 3 contains some minor amendments
to the Telecommunications (Carrier Licence Charges) Act 1997 that are
consequential to the proposed amendments in Schedule 1 to the Bill.
Part 1 of Schedule 2 assists parties to reach commercial agreement on
fair terms and conditions of access by requiring the ACCC to publish model terms
and conditions of access. The model terms and conditions will relate to the
following ‘core’ services that have already been declared by the
ACCC under the telecommunications access regime:
• Domestic Public
Switched Telephone Network (Originating and Terminating) Service;
• Unconditioned Local Loop Service; and
• Local Carriage
Service.
The ACCC will be required to have regard to the model terms and
conditions if it is called upon to arbitrate an access dispute in relation to
the service.
Part 2 of Schedule 2 improves the certainty and timeliness
of access by removing merits review by the Australian Competition Tribunal (ACT)
in relation to final determinations made by the ACCC. The amendments will not
affect the ability of a party to seek merits review of decisions of the ACCC
under Part XIC in relation to an application for an exemption order or an access
undertaking, nor the ability to seek judicial review of a final ACCC
determination. The Bill preserves appeal rights where an application for appeal
has been lodged, or where parties have a right of appeal at the time of
commencement of the Bill.
Parts 11 and 12 of Schedule 2 promote timely
decision-making by introducing time limits on the ACCC’s and ACT’s
decision-making process for exemptions and undertakings. The ACCC or the ACT is
deemed to have approved an application if it does not make a decision at the end
of a 6-month period, subject to provisions that will allow the ACCC or the ACT
to extend, or further extend, the 6-month period by notifying the applicant and
publishing a statement of reasons explaining the extension. The ACCC will be
able to “stop the clock” when requesting further information or when
conducting public consultation.
Parts 11 and 12 of Schedule 2 remove
scope for the above time limits to be abused by limiting the information and
evidence that the ACT may consider on review of decisions of the ACCC in
relation to exemptions and undertakings to the information, evidence and
documents that were before the ACCC in making the original decision.
Part 12 of Schedule 2 acknowledges the industry-wide benefits of
undertakings by allowing the ACCC to defer the consideration of an access
dispute, in whole or in part, in order to consider an access undertaking
received by the ACCC that relates, in whole or in part, to the matter that is
the subject of the access dispute. In addition, proposed section 152CGA will
provide that a determination made by the ACCC under Division 8 (ie, a final
determination in relation to an access dispute) has no effect to the extent to
which it is inconsistent with an access undertaking that is in
operation.
The effective the operation of the standard access obligations
will be ensured by clarifying that they apply independently of any ACCC
determination (Part 7 of Schedule 2) and that ‘ordering’ and
‘provisioning’ are aspects of technical and operational quality
under the standard access obligations (Part 13 of Schedule 2).
Facilitating investment in new telecommunications
infrastructure
There are two mechanisms to facilitate investment in new telecommunications
infrastructure. Firstly, Part 11 of Schedule 2 promotes certainty for investors
in telecommunications facilities by extending the current exemption mechanism
under Part XIC. These provisions allow the ACCC to determine that a class of
carriers and/or carriage service providers, or a particular individual, is
exempted from the standard access obligations even if that service is not in
existence at the time that the exemption is sought. The essential features of
these proposed exemptions are that:
• they may contain limitations (for example, by
referring to a service that is supplied using a particular facility or
particular infrastructure and/or in a certain geographical
area);
• when determining whether an exemption
will be in the long-term interests of end- users the ACCC will be required to
have regard to any matters specified by the Minister; and
• the ACCC will be subject to the 6-month time limit mentioned above in deciding whether to make an order.
Secondly, Part 12 of Schedule 2 further promotes certainty for investors in
telecommunications facilities by extending the current provisions in Part XIC
relating to access undertakings. These provisions allow the ACCC to accept
undertakings from existing and potential access providers of all
telecommunications services (including services provided by a particular piece
of telecommunications infrastructure), irrespective of whether those services
have or will be declared, or are in existence at the time the undertaking is
lodged. The essential features of the proposed amendments are
that:
• they create two types of access
undertakings: ordinary access undertakings (currently known under Part XIC as
access undertakings) and special access undertakings. Special access
undertakings will cover proposed services and services which may exist to some
extent but are not yet declared and may be given by a person who is, or expects
to be, a carrier or carriage service provider;
• a special access
undertaking may relate to a listed carriage service or a service that
facilitates the supply of a listed carriage service that the person expects to
supply;
• a special access undertaking must contain an expiry time but
it may also contain provisions for the extension, or further extension, of the
undertaking with the approval of the ACCC. A special access undertaking may be
withdrawn voluntarily, subject to certain notice requirements;
• once a
special access undertaking comes into operation, it will operate as though the
service supplied by the person who gave the undertaking is an active declared
service, even if the service is not the subject of a declaration of general
application;
• the ACCC will be subject to the
6-month time limit mentioned above in relation to decisions about ordinary and
special access undertakings; and
• when determining whether a special access
undertaking is reasonable, the ACCC will be required to have regard to any
matters specified by the Minister.
Facilitating a more
transparent regulatory market
The Government has previously announced
that it will encourage a more transparent regulatory market by requiring
accounting separation of Telstra’s wholesale and retail operations.
Accounting separation will address competition concerns arising from the level
of vertical integration of Telstra’s wholesale and retail services and
improve the provision of costing and price information to access seekers and the
public.
The Government’s proposed accounting separation framework
will ensure:
(a) Telstra prepares current (replacement) cost accounts (as
well as existing historic cost accounts) to provide more transparency to the
ACCC about Telstra’s ongoing and sustainable wholesale and retail costs;
(b) Telstra publishes current cost and historic cost key financial
statements in respect of “core” interconnect services but not
underlying detailed financial and traffic data which is regarded as commercially
sensitive;
(c) the ACCC prepares and publishes an “imputation”
analysis (based on Telstra purchasing the ‘core’ interconnect
services at the price that it charges external access seekers) which will
demonstrate whether there is any systemic price squeeze behaviour;
and
(d) Telstra publishes information comparing its performance in supplying
“core” services to itself and to external access seekers in relation
to key non-price terms and conditions. (These will include faults /
maintenance, ordering, provisioning, availability / performance, billing and
notifications).
The amendments in Part 16 of Schedule 2 provide a
mechanism for the Government to introduce accounting separation by enabling the
Minister to direct the ACCC in relation to the exercise of its existing
record-keeping rule powers under Division 6 of Part XIC. The Minister’s
direction would be a disallowable instrument. The direction power will provide
flexibility for the Government to introduce accounting separation of
Telstra’s wholesale and retail operations in a probative and deliberate
manner without the complexity of specifying detailed regulatory accounting rules
in Part XIB.
Anti-competitive conduct provisions (Part
XIB)
Several amendments are made to enhance accountability and
transparency of decision making in Part XIB. Part 9 of Schedule 2 requires the
ACCC to issue guidelines to address the circumstances of the ACCC issuing a
competition notice as opposed to taking other action under the TPA. The
amendments in Part 16 of Schedule
2:
• provide that the ACCC must consult with
a carrier or carriage service provider before issuing a Part A competition
notice, including providing the carrier or carriage service provider with a
written notice that summarises the instance or kind of anti-competitive conduct
to be specified in the Part A competition notice;
and
• allow the ACCC to issue an advisory notice
before, at the same time, or after the issue of a Part A competition notice
advising a carrier or carriage service provider of the action that it should
take, or consider taking, in order to ensure that it does not engage, or does
not continue to engage, in anti-competitive conduct.
Other changes to
the telecommunications competition regime
The Bill contains a number
of amendments to the Telecommunications Act
1997:
• Part 1 of Schedule 1 shifts the
responsibility for determining which services should be subject to pre-selection
from the Australian Communications Authority to the
ACCC;
• Part 2 of Schedule 1 removes the
legal requirement for Industry Development Plans in relation to carrier
licensing; and
• Part 3 of Schedule 1 aligns
the various procedures and obligations on service providers to provide
information to enable efficient interconnection between networks contained in
Part 4 of Schedule 1 of the Telecommunications Act.
Other amendments to
the TPA contained in the Bill will:
• provide that a declaration
must sunset after five years from the making of the declaration (Part 3 of
Schedule 2);
• allow the ACCC to revoke a
declaration of minor importance without holding a public inquiry (Part 4 of
Schedule 2);
• provide that the time that a service
provider’s reasonably anticipated requirements are measured under
paragraph 152AR(4)(a) and subsection 152CQ(1) will be the time that an access
seeker (or service provider as described in section 152AR) makes a request under
section 152AR for access to a declared service (Part 5 of Schedule
2);
• prevent the ACCC from making a
determination that would have the effect of requiring a party (other than the
access seeker) to bear an unreasonable amount of the costs (rather than some or
all of the costs as is currently the case) of extending or enhancing the
capability of a facility or maintaining extensions to or enhancements of the
facility (Part 6 of Schedule 2);
• clarify the ACCC’s power to require a
party to an arbitration to pay interest to another party on the whole or part of
the money that the party is required to pay the other party under the
determination. The ACCC will be required to publish guidelines on the use of
this power (Part 8 of Schedule 2);
and
• repeal provisions relating to the
Telecommunications Access Forum (Part 10 of Schedule 2).
Schedule 3 to
the Bill make some minor amendments to the Telecommunications (Carrier
Licence Charges) Act 1997 consequential to the proposed repeal of the legal
requirement for Industry Development Plans in carrier licensing (Part 2 of
Schedule 1).
The Bill is not expected to have any financial impact on Commonwealth
expenditure or revenue.
The Telecommunications Competition Bill 2002 (the Bill) makes amendments
to
Parts XIB and XIC of the Trade Practices Act 1974 (TPA) and some
amendments to the Telecommunications Act 1997 and the
Telecommunications (Carrier Licence Charges) Act 1997. Part XIB of the
TPA deals with anti-competitive conduct in the telecommunications industry and
Part XIC deals with interconnection and access to telecommunications services.
This Regulation Impact Statement (RIS) identifies the key issues the Bill
addresses, the options for addressing them and explains why the approach
implemented has been adopted.
Part XIB of the TPA supplements the ACCC’s general anti-competitive
conduct powers by enabling the ACCC to issue competition notices to carriers and
carriage service providers with substantial market power engaging in conduct
with the purpose or effect of substantially lessening competition. The issue of
a competition notice is designed to promptly stop anti-competitive conduct and
opens the way for substantial penalties and damages.
Under Part XIB, the
ACCC can also require a carrier or carrier service provider to file its charges
(public tariffs and access agreements), enabling their scrutiny for
anti-competitive purpose or effect. The ACCC can also make record-keeping rules
requiring carriers or carriage service providers to keep both financial and
non-financial information in a prescribed form and to publish this
information.
The object of the telecommunications access regime in Part
XIC is to promote the long-term interests of end-users of carriage services or
services provided by means of carriage services. In determining whether
something promotes the long-term interests of end-users, regard must be had to
whether it is likely to result in:
• promoting
competition;
• achieving any-to-any connectivity;
and
• encouraging the efficient use of, and economically efficient
investment in, infrastructure used to supply telecommunications
services.
Under Part XIC, the ACCC has the power to “declare”
services for the purposes of the telecommunications specific access regime.
Carriers and carriage service providers are generally required to provide
interconnection with, and access to, services declared by the ACCC, together
with various ancillary services. In the first instance, terms and conditions of
supply, including price, are commercially negotiated between parties or set out
in an undertaking given by the access provider; if negotiations fail, the
ACCC may determine terms and conditions.
In 2001 the Parliament passed
the Trade Practices Amendment (Telecommunications) Act 2001 which
introduced a series of measures to streamline the operation of Part XIC (the
2001 streamlining
amendments)[1].
In June 2000,
the Government issued terms of reference for a review by the Productivity
Commission (PC) of the telecommunications-specific competition regulations,
including a review of Part XIC. On 23 December 2001, the Government released
the PC’s Inquiry Report on Telecommunications Competition Regulation
(Report No. 16 of 2001) (the PC report) for public comment. The PC report
broadly recommended the retention of telecommunications-specific provisions for
dealing with anti-competitive conduct (Part XIB) (PC
5.1)[2] and for providing access to
telecommunications services (Part XIC) (PC 8.1).
After careful
consideration of the telecommunications-specific competition regime, including
the recommendations of the PC report, on 24 April 2002 the Government announced
a range of measures that it would introduce to enhance the operation of the
regime. These initiatives were aimed at increasing the level of competition and
investment in the telecommunications market to the benefit of consumers and
business. In broad terms, the package of measures were to:
(a) provide
greater certainty and more timely access for access seekers by requiring the
regulator to produce model terms and conditions of access for core
telecommunications services such as Public Switched Telephone Network (PSTN)
Origination and Termination Service, Local Carriage Service (LCS) and
Unconditioned Local Loop Services (ULLS);
(b) facilitate timely access to
basic telecommunications services by removing the right to merits review in
relation to access arbitrations;
(c) facilitate investment in new
telecommunications infrastructure by extending the existing provisions under
Part XIC of the TPA relating to exemptions and undertakings to include services
that are not yet declared or supplied;
(d) encourage a more transparent
regulatory market by requiring accounting separation of Telstra's wholesale and
retail operations; and
(e) a number of minor changes to the
telecommunications regime including making additional information available to
the market; repeal of the requirement for Industry Development Plans; monitoring
of access pricing by power utilities; monitoring the timeliness of porting
processes and clarification of some minor technical legislative
matters.
This RIS assesses the regulatory impact of these measures as
they have been incorporated into the Bill.
The key stakeholders with an interest in these matters
are:
• access providers;
• access
seekers;
• carriers and carriage service
providers;
• potential investors in telecommunications services;
and
• end-users of telecommunications services.
A significant degree of stakeholder consultation has informed the
Government’s decision-making process in relation to the matters addressed
in the Bill.
The PC report, a key input to the process, was itself
developed following extensive public consultation, including:
• the
release of issues papers in June 2000 and early January 2001;
• the
release of a draft report in March 2001 for public comment;
• informal
discussions with 24 organisations and consideration of over 100 written
submissions; and
• public hearings in August 2000 and May 2001 in which
27 organisations took part in total.
The Government released the PC
report on 21 December 2001. At that time, the Minister for Communications,
Information Technology and the Arts, Senator the Hon. Richard Alston, called for
public comments. These were to be provided in writing to the Department of
Communications, Information Technology and the Arts by
15 February 2002.
A number of written submissions were received in relation to the
Government’s response to the PC report. In addition, a general industry
forum and one forum that focussed specifically on the concerns of regional ISPs
were held on 4 March and 8 March 2002 respectively.
This consultation demonstrated there was broad agreement on the policy
objectives of telecommunications competition regulation,
including:
• reducing delays and providing greater certainty in
resolving the terms and conditions of access to core services that relate to
Telstra’s fixed line network;
• promoting investment in
telecommunications infrastructure;
• improving transparency (and
reducing discrimination) between Telstra’s wholesale and retail services;
and
• the provision of further costing / price information to access
seekers and to the market.
Following the Government’s announcement
on 24 April 2002 of the measures that it would introduce in response to the PC
report, further detailed industry consultation occurred on the implementation of
these measures.
The Bill incorporates those PC report recommendations that have been
accepted by the Government, which require legislative amendments to be given
effect. A small number of the PC report recommendations that have been accepted
by the Government can be implemented administratively.
The
Government’s full response to the PC report is contained in The
Government’s Response to the Productivity Commission’s (PC) Report
on Telecommunications Competition Regulation which will be available from the
Internet site of the Department of Communications, Information Technology and
the Arts at www.dcita.gov.au.
The ACCC will be
responsible for implementing the majority of the proposals in the Bill. Where
these give rise to specific implementation requirements these are drawn out in
the discussion below.
The Government will continue to closely monitor
the operation of the telecommunications-specific competition regulations under
the TPA and any related provisions in the Telecommunications Act 1997.
In line with the PC report recommendations 5.9 and 6.1, the Government has
decided that there will be a further review of Parts XIB and XIC of the TPA in
five years.
1. Providing greater certainty and facilitating more
timely access to basic telecommunications services
The underlying philosophy of the telecommunications access regime in Part
XIC of the TPA is focussed on the terms and conditions of access being
established through commercial agreement, or being set out in access
undertakings. This provides flexibility for parties to establish access
arrangements that match their commercial needs. Where parties cannot agree on
the terms and conditions of access they can take their dispute to the ACCC for
binding arbitration (determinations). The Australian Competition Tribunal (ACT)
is empowered to review determinations by the ACCC based on the evidence that was
provided to the ACCC.
The telecommunications access regime promotes
commercial outcomes, however, the development of the industry continues to be
frustrated by delays in securing access to core fixed line network services.
These delays are caused in part by uncertainties as to the outcomes that will be
achieved through arbitration. Delays and further uncertainty also arise from
the protracted review process that can follow ACCC arbitrations. Delay in
obtaining access can have the result of diminishing competition for services and
discouraging access seekers from entering the market.
Provide greater certainty and more timely access for access seekers to
“core” fixed line network services.
(a) Maintain the current position
Option (a) is to leave
unchanged the current process for securing access to network services. This
process has provided a framework under which numerous access arrangements have
been established, however, experience to date has been that achieving access has
been at times a protracted and costly process. This can be attributed, in part
to the substantial reliance on ACCC arbitration to resolve disputes rather than
resolution through commercial negotiation.
As noted above, the
underlying philosophy of the access regime is for terms and conditions of access
to be established through commercial agreement. This provides flexibility for
parties to agree on terms and conditions that reflect their specific
circumstances, and to a significant extent it has been successful. The PC
report noted that “by far the majority (at least 80%) of terms and
conditions for access are commercially
negotiated”.[3] However, 44
disputes on terms and conditions of access have gone to arbitration and these
disputes have tended to involve the core high volume services such as PSTN and
LCS. These results suggest that further improvements could be made.
The dispute resolution process has tended to be protracted. Only eight
final determinations have been made by the ACCC. Of these, three were made over
eighteen months after the dispute had been notified to the ACCC. The ACCC has
terminated two disputes, in one jurisdiction was not established and 33 disputes
have been withdrawn at the request of the parties. It also should be noted that
some of these disputes would have been the subject of commercial negotiation for
a considerable period, before being taken to the ACCC.
The 2001
streamlining amendments addressed a number of the procedural aspects of the
arbitration process in order to reduce the delays that were occurring. The
streamlining amendments introduced into the regime some multilateral mechanisms
for the settling of disputes by making provision for multi-party arbitrations.
The steamlining amendments also allowed the regulator to make better use of
information by allowing it to provide arbitration information from one
arbitration to another and requiring it to produce pricing principles that it
would have regard to in arbitrations. These amendments were in line with those
proposed in PC recommendations 10.8, 10.10 and 10.11. The streamlining
amendments also sought to reduce delays by limiting the material that the ACT
could consider on review to that which was provided to the ACCC at first
instance.
These amendments have reduced the potential for delay from the
arbitration process, however, one further area where improvements could be made
is to provide incentives for parties to reach commercial agreement so that terms
of access can be agreed before needing to go to arbitration.
Under the
current processes for securing access to network services there is relative
uncertainty prior to arbitration as to what the eventual terms and conditions of
access will be. As a result, parties tend not to be willing to compromise in
their commercial agreement because they believe they will get a better outcome
from arbitration. If parties were more aware of the proximate outcome from
arbitration they may be more likely to agree on terms of access commercially.
(b) Modify the current regime to improve the timeliness and certainty
of obtaining access
This option is to adopt further measures to
improve the timeliness and certainty of obtaining access to “core”
fixed line network services by increasing the incentives for terms and
conditions of access to be established through commercial agreement, or to be
set out in access undertakings. Central to this option would be a requirement
for the ACCC to publish model terms and conditions of access for
“core” wholesale telecommunications services. While these model
terms and conditions would not be binding they would provide clear guidance
about the regulator’s views as to what fair terms and conditions for
access would be. The model terms and conditions would be based on an assessment
of the current market conditions and would be in a form that could easily be
incorporated into access agreements or be adopted by an access provide in an
access undertaking. If a dispute about terms and conditions then arose between
parties, any subsequent ACCC arbitration decision (determinations) would be
expected to reflect the model terms and conditions.
The
“core” services for which model terms and conditions could be
established are the Public Switched Telephone Network Originating and
Terminating Service, Unconditioned Local Loop Service (ULLS) and Local Carriage
Service (LCS). Each of these services is a bottleneck service vital to the
supply of many other telecommunications services. Further services (if any)
could be included via regulation, and thus would be subject to consideration by
Parliament.
This option overcomes the uncertainty that currently exists
prior to regulatory arbitrations as to what the ACCC’s likely views may be
concerning the eventual terms and conditions of access. Up-front provision of
this information is likely to assist the commercial negotiation process by
giving parties a view of what the likely outcome of an ACCC determination on the
issue would be. This is likely to bring the parties’ negotiating position
closer together, thus expediting and simplifying the commercial negotiation
process. This follows similar reasoning to PC report recommendations 10.11 and
14.4.
This option would benefit access seekers (particularly smaller or
niche players) as it would set a starting point for access negotiations, thereby
reducing the overall time taken to gain access. It would also result in
financial certainty for access seekers by giving a broad indication of likely
outcomes. It would also overcome some of the information asymmetry that may
disadvantage small rivals compared to the incumbent.
Option (b) also
includes a number of procedural changes to further promote certainty and
timeliness of access. To promote certainty for competitors in obtaining access
via the telecommunications access regime, the right of parties to seek merits
review of ACCC determinations would be removed. In addition, to reduce delays
in setting terms and conditions of access, time limits would be introduced for
the ACCC and ACT consideration of exemptions and undertakings. It should be
noted that the right of review to the ACT on ACCC decisions on exemptions and
undertakings would remain.
These changes recognise that the time taken
to resolve disputes is a matter of concern to many participants in the
telecommunications industry. Delay in decision making imposes costs on industry
participants and creates uncertainty for investors. The cost of delay is
difficult to quantify because it comprises lost benefits from potential new
investments in the telecommunications industry. Delay in decision making
reduces competition and consequently affects the quality and price of
telecommunications services offered to consumers.
As an example of the
potential delay resulting from the review process, an appeal in relation to the
ACCC’s decision on PSTN access was notified to the ACT in October 2000,
with initial hearings commencing in November 2000. In March 2002 the parties
settled and the dispute was withdrawn, without ever having a substantive hearing
on the terms of access. In fact, it is likely that a substantive hearing would
not have occurred until 2003.
Removing merits review of ACCC decisions
recognises the significant delays that have resulted from the review process in
the past and that new entrants seeking access to telecommunications
infrastructure have difficulty raising or committing capital during the review
process due to the contingent liability of an unfavourable outcome via, for
example, a backdated determination or review decision. Removing merits review
also promotes certainty by streamlining the decision-making process. It
provides for consistency in decision-making and in concert with the publication
of model terms and conditions, it will enable industry participants to have a
clear understanding of the likely outcome of arbitrations.
The main
risk of removing merits review arises from the potential occurrence of
regulatory error or breach of due process by the ACCC and the degree to which
removing merits review limits the ability to have the correct decision made by
the ACT. In relation to due process, ACCC arbitrations involve an exhaustive
examination of the issues and are prosecuted by experienced and well-resourced
participants. It is unlikely that the parties to these proceedings would not be
capable of upholding their rights and ensuring that all relevant information is
provided to the decision maker. In relation to regulatory error, the PC report
concluded that the range of variables in making a determination meant that the
ACCC might be prone to regulatory error. However, there appears to be little
reason why the ACT would not be equally subject to the same regulatory error.
The ACT does not have the ACCC’s technical skills nor its experience in
dealing with telecommunications issues. The ACT is also likely to rely on the
ACCC for technical advice. Therefore, merits review may do little to reduce the
risk of regulatory error. If the ACCC does err on a matter of law or process,
parties to an ACCC determination decision retain the capacity to seek review by
the Federal Court under the Administrative Decisions (Judicial Review) Act
1977, as well as under other appeal mechanisms in the Federal and High
Courts.
Introducing time limits on the ACCC and ACT decision-making
processes in relation to exemptions and undertakings promotes timely access for
access seekers. Binding time limits send a clear message and introduce a degree
of discipline on the ACCC and ACT. The ACT currently faces time limits in
making decisions in respect to mergers and acquisitions and under the Gas
Pipelines Access (South Australia) Act 1997. The negative effects of a
fixed time limit and the potential for this time limit to be abused can be
mitigated by providing the decision-maker with an ability to “stop the
clock” between requesting further information from parties and receiving
that information and while conducting public hearings. The negative effect can
be further mitigated by allowing the decision-maker to extend the time period
for further periods of up to three months, with publication of a statement of
reasons.
Any scope for regulatory gaming of these timeframes will be
further restricted as this option also proposes limiting the information which
the ACT may consider in a review of the ACCC’s decision on an undertaking
or exemption to that which was considered by the ACCC in making the original
decision. This approach is consistent with the measures adopted in the
streamlining amendment (in relation to ACT reviews of determinations) and it
also recognises the likely shift in regulatory activity from arbitrations to
undertakings and exemptions as a result of the removal of merits review of
determinations.
(c) Require the regulator to determine and enforce
uniform terms and conditions of access for all access seekers over common
services
Under option (c), operators with significant market power
would be required to publish standard interconnection offers specifying the
technical conditions and tariffs applicable for interconnection. In turn the
regulator would require those offers to meet cost-based pricing principles.
This centralised approach to setting access terms and conditions is adopted in
many other countries, including Finland, France and Japan.
This
approach could provide greater certainty and more timely access to declared
services, particularly for smaller access seekers. It could also benefit the
ACCC as it would reduce the number of disputes notified to the ACCC for
arbitration.
However, this approach would be inconsistent with the
underlying philosophy of the current regulatory regime that is focussed on the
terms and conditions of access being established through commercial agreement,
or being set out in access undertakings. A centralised approach to setting
access arrangements would lead to uniform terms and conditions for access.
Access seekers would lose the flexibility to obtain services on terms and
conditions that reflect their specific circumstances or that were suitable for
their customers. Access providers may be forced to alter their networks or
supply services on terms and conditions that were not commercially viable.
A centralised approach to setting access terms and conditions may result
in standardised access arrangements that may consequently lead to a dampening of
competition and result in a loss of choice for consumers.
In implementing
this option it would be difficult for the regulator, or the incumbent, to set
inter-connection arrangements which would be flexible and suitable to the unique
requirements of all access seekers and ultimately in the long-term interests of
end-users. It is likely that the inter-connection arrangement would favour some
players over others, thus distorting competition.
Consultation revealed that there is considerable concern over the speed
at which regulatory decisions are made. A number of the submissions received by
the Government focussed on the tension between having a decision-making process
that emphasised efficiency and expediency and one that prioritises transparency,
accountability and accuracy, by incorporating layers of reviews.
A number
of submissions supported a role for the ACCC of producing model terms and
conditions. Indeed some proposed that these terms and conditions should
encompass not only price but also non-price terms and conditions of access,
which they argued are becoming an increasingly important consideration in access
negotiations. Some submissions advocated the benefits of uniform terms and
conditions, pointing to their application in a number of overseas jurisdictions.
The regulator is comfortable with its added role of producing model terms and
conditions, as it builds on its existing functions of producing pricing
principles and resolving access disputes.
A number of submissions were
polarised on the issue of merits review. For example, many stakeholders
believed that the advantages of a faster decision would outweigh any
disadvantages. Some also argue that review mechanisms can be used as a costly
delaying tactic, which disadvantages new or smaller players and diverts
resources from areas such as infrastructure investment. Others see merits
review as critical to minimising regulatory error and support extending the
range of decisions subject to merits review.
Time limits have at times
received support from all sections of the industry and neither the ACCC nor the
ACT have raised in principle objections to their introduction, provided they
contain provisions to “stop the clock” and extend the time limit in
appropriate circumstances.
Option (a) has gone some way to improving the timeliness of the access
process however it does not provide sufficient incentive for parties to reach
commercial agreement. Option (b) reduces the uncertainty as to the outcome from
arbitration and thus increases the likelihood that parties will reach commercial
agreement on the terms and conditions for access. It also further improves the
timeliness of the arbitration process and should benefit investment and
competition. Option (c) represents a significant departure from the current
regulatory regime and has the potential to stifle competition and choice for
consumers. It is recommended that option (b) be adopted.
The Bill provides that the ACCC must make a written determination setting
out the model terms and conditions relating to each core service. Before making
a determination the ACCC must publish a draft of the determination and consider
any submissions on that draft and it must also consult with the Australian
Communications Authority. The Bill provides that the ACCC must take all
reasonable steps to ensure that a determination relating to each core service is
made within six months of commencement of the Bill.
2. Facilitating
investment in new telecommunications infrastructure
In recognition of the importance of broadband and other
telecommunications services to the future growth of the Australian economy, it
is important to ensure that Part XIC promotes investment by access providers in
core infrastructure.
To promote greater certainty for major new telecommunications
infrastructure investment.
(a) Maintain the current position
Under the current
provisions of Part XIC, a potential investor in a telecommunications service is
unable to receive an exemption from the obligation to provide access to a
declared service or to lodge an access undertaking until they supply an active
declared service, as declaration can only occur for a service that is being
supplied. This can provide a disincentive for investment because it means
potential access providers cannot obtain regulatory certainty as to whether or
not their service will be declared, and if so, on what terms they will be
required to provide access. In particular, where “risky
investments” are subject to potential declaration, the investment may be
rendered uneconomic as a result of this uncertainty.
This concern can, in
part, be addressed through existing mechanisms that provide for appropriate
access prices that allow the access provider to receive a normal commercial
return. However, the regulator’s task in distinguishing between an
appropriate reward for a risky investment and monopoly rents is difficult.
Uncertainty in the minds of the investors about the outcome of this decision can
result in marginal investments being delayed or cancelled.
The costs of
relying on the declaration criteria and access prices could be significant but
are difficult to quantify because they relate to potential lost investments
arising from the lack of certainty for investors. This may be in the form of
the delayed roll-out of new broadband services, with consequent flow-on effects
on the community from delayed access to high-speed communication services.
(b) Extend the existing provisions in Part XIC to enable the ACCC to
grant exemptions and approve undertakings for new services
This
option would extend the existing provisions in Part XIC to enable the ACCC to
grant exemptions and approve undertakings for services that are not yet declared
or supplied. This would provide certainty for investors and thus encourage
investment by allowing the ACCC to rule on whether a service should be exempt
from declaration or whether the terms of a proposed undertaking are acceptable
prior to the investment being made.
These anticipatory exemptions and
special undertakings would not be time limited, but would specify the period for
which they will apply. Longstanding exemptions may be appropriate in
circumstances where a service is “ex-post” contestable, and
therefore would not normally be declared, but an investor may wish to obtain a
ruling that this is the case beforehand. Exemptions for a limited period could
exempt the investment from access requirements for a short period of time, just
as in the case of patents, and could provide an incentive to invest and innovate
in otherwise uncertain circumstances.
Unlike ordinary undertakings,
special undertakings would not have a maximum legislated time limit. This
provides further certainty for investors and an additional incentive for the
access provider to submit a special undertaking. Special undertakings have the
benefit of providing industry-wide access to the service on terms that are
agreeable to the access provider and regulator. This would assist access
seekers to avoid costly arbitration proceedings by utilising the terms and
conditions of access in the special undertaking.
The combination of
the binding term and the capacity for the investor and regulator to come to
agreement on the conditions of the anticipatory exemption or special undertaking
mean that this mechanism would allow the access provider and the regulator to
enter into a type of regulatory compact. The adoption of up-front exemptions
was recommended by the PC (PC 9.5).
Recognising the potential
economy-wide benefits of some investments, the ACCC would be required to
consider any views of the Minister for Communications, Information Technology
and the Arts in considering whether or not to grant an anticipatory exemption or
to approve a special undertaking, in addition to the standard considerations.
Such views would be required to be specified in writing and would be subject to
the possibility of disallowance by Parliament.
To enhance the potential
of these anticipatory exemptions and special undertakings to promote investment
certainty, timely decision making would be prompted by providing that the
anticipatory exemption or special undertaking would be deemed to be accepted
unless the ACCC rejected it within 6 months of receipt of the application.
Similar to the provisions noted above, to mitigate the effects of an absolute
deadline, the calculation of this period would exclude
time:
• between the decision-maker seeking further information and
the supply of that information; and
• whilst conducting a public
hearing.
Further, the decision-maker would be able to extend (and further
extend) the above timeframe by periods of up to 3 months at a time with
publication of a statement of reasons.
Option (b) would result in some costs for the ACCC, as it would need to
devote resources through its ongoing role in the administration, implementation
and oversight of the reporting regime, but this may be balanced by the savings
from less time spent on its declaration and arbitration processes.
The
binding nature of anticipatory exemptions and special undertakings also raises
some risks for the regulator and access provider in the circumstances where the
conditions of the market change over time. However, this would be a matter of
judgement for the regulator and the potential investor and would be weighed
against the benefits to the community and access seekers.
In recognition of the fact that the ACCC could not revoke a special undertaking and to ensure that access seekers’ rights were adequately protected, access providers would be required to give 12 months notice before a “special” access undertaking could be withdrawn. This would provide time for the ACCC to consider whether there was a need to conduct a declaration hearing to determine if the service should be declared prior to the special undertaking being withdrawn.
Ultimately, the use of anticipatory exemptions and special undertakings
could see customers benefit from a wider range of services available on new and
more diverse infrastructure, and from lower prices resulting from greater
investment in new infrastructure. This may lead to economy-wide benefits as
businesses take-up new services at lower prices.
(c) Allow case by case legislative exemptions for major
projects
Another approach for quarantining an investment from
declaration prior to the investment being made is to provide for case by case
legislative exemptions and undertakings for major projects. This approach would
involve legislation specifically designed to apply to a particular project being
passed by Parliament which would override or alter the existing provisions in
Part XIC.
This option offers the potential to mirror many of the
benefits of anticipatory exemptions and special undertakings as the legislative
exemption could be developed to accommodate the particular needs of each
project. A legislative process may in fact be particularly suited to
infrastructure projects of national significance by providing additional
flexibility and by allowing the Parliament to take into account a wide range of
factors when assessing the merits of a proposed exemption or undertaking.
However, establishing a separate process for legislative exemptions and
undertakings would be more administratively complex and costly for the
Government and also potentially costly for the access seeker. This complexity
may not provide a timely response, particularly as normal legislative drafting
and Parliamentary processes would need to be taken into account.
This
option could also be considered with more scepticism by access seekers as it
would not be bound by the same procedural steps and ordered deliberations as the
current assessment process undertaken by the ACCC. It would also have the
potential to be less open and transparent.
There has been considerable concern over the ACCC’s inability to
exempt services provided by a prospective investment from declaration. A number
of submissions advanced proposals similar to that outlined in option (b).
Others argued that undertakings already allowed investors to achieve up-front
certainty and that there is no evidence that the current Part XIC objects and
statutory criteria are a barrier to investment.
Option (a) does not allow potential investors to obtain certainty and
thus has the potential to deter investment in new infrastructure that may
otherwise have benefited consumers. Option (b) provides flexibility and
certainty by extending existing exemption and undertaking provisions to services
that have not yet been supplied or declared. Option (c) would provide similar
benefits to option (b), however, it would be more administratively complex,
prolonged and less transparent. It is recommended that option (b) be adopted.
3. Facilitating a more transparent regulatory market
The vertical integration between Telstra’s wholesale and retail
divisions has raised concerns about the lack of transparency between
Telstra’s wholesale and retail services, with the consequent concern that
Telstra’s wholesale services are possibly not being provided to
competitors on a non-discriminatory basis.
Address competition concerns arising from the level of vertical
integration between Telstra’s wholesale and retail services and improve
the provision of costing and price information to access seekers and the
market.
(a) Existing regulatory accounting framework
This option is
to continue to rely on the ACCC to implement accounting transparency under its
existing regulatory accounting framework.
The ACCC has wide powers to
make record-keeping rules (RKRs). These rules were enhanced in 1999 by
providing the ACCC with explicit powers to publish the information it collected
under the RKRs. The intention at the time was for the ACCC to use the powers of
disclosure to assist it in determining whether conduct was anti-competitive by
enabling market participants, with their knowledge of telecommunications, to
provide advice or comments to the ACCC, and to benefit negotiations under the
access regime by providing all parties to those negotiations with a common
information base.
In November 2000, the ACCC released for comment the
draft Telecommunications Industry Regulatory Accounting Framework (RAF) setting
out record-keeping rules. In August 2002, the ACCC issued a draft report
seeking comment on the public disclosure of information collected via the RAF.
The development of the RAF has been a detailed and deliberative process
involving close consultation with industry and addressing a multitude of complex
issues. However, the ACCC is yet to publish information collected under the
RAF.
Delay in implementing accounting transparency is likely to benefit
the incumbent as it is subject to less industry scrutiny and its competitors are
at more of a disadvantage in access negotiations.
(b) Ministerial
Direction
This option is to provide the Minister for Communications,
Information Technology and the Arts with a power to direct the ACCC in
the use of its existing powers to make RKRs. This would allow the Government to
mandate the implementation of accounting separation for Telstra in a more
probative and deliberate manner. Accounting separation would build upon the
work that has been commenced by the ACCC in developing the RAF and require
relevant accounts to be disclosed to the public. The PC report noted that
accounting separation had the potential to “reduce the scope for
discriminatory pricing between Telstra’s downstream arms and other access
seekers” (PC report page 360).
The key benefits of this option
would be that:
• the ACCC would have better costing information to
identify possible discriminatory and anti-competitive
behaviour;
• Telstra’s competitors would have access to
transparent price and non-price information in relation to the core services
that are subject to Telstra’s monopoly control, thereby assisting them in
identifying possible cases of discrimination and in negotiating commercial
agreements for access; and
• release of transparent cost information is
likely to deter anti-competitive conduct.
The disclosure of information
to the regulator and the market could potentially have some negative impacts on
Telstra. In view of the need to mitigate these impacts to sustain a competitive
market, this option would not:
• require Telstra to re-configure
its business units thereby imposing additional costs and reducing
efficiencies;
• give the ACCC any new discretionary
powers;
• reduce Telstra’s capacity to realise its bona fide
economies of scale and scope; or
• involve any structural separation of
Telstra’s wholesale or retail divisions.
Telstra has already
developed accounting systems to report against the RAF. To the extent that
accounting separation requires Telstra to undertake further work, there are
likely to be some additional costs to Telstra.
This issue has been the subject of significant public debate and has
similarly been the focus of a considerable number of the submissions to the
Government and in the Government’s discussions with industry. A number of
submissions to the Government expressed concerns over the apparent lack of
information available to the market on the pricing of Telstra’s wholesale
services. A number of submissions argued that the Government should adopt more
interventionist arrangements than accounting separation in order to address
Telstra’s vertical integration and the information asymmetry inherent in
its provision of wholesale services to its competitors.
In developing
the accounting separation framework the Government has had regard to the views
of the key stakeholders and to accounting separation approaches in overseas
jurisdictions (including the accounting separation regime administered by Oftel
in the United Kingdom). The proposed framework is generally regarded as being
acceptable by Telstra, with it holding reservations in some areas. Conversely,
its competitors would prefer to see the arrangements taken further, while
recognising it will represent a significant improvement in the level of
information available to the market.
Accounting separation of Telstra’s wholesale and retail
arrangements is consistent with the PC report recommendations and has the
potential to promote competition and to deliver improved services to the public.
However, under option (a), continued reliance on the ACCC’s implementation
of the RAF may not place enough information in the public domain in a timely
manner. Option (b) makes effective use of the ACCC’s existing RKRs and
does not impose unreasonable costs on Telstra. It is recommended that option
(b) be adopted.
The Bill provides that the Minister for Communications, Information
Technology and the Arts may give a written direction to the ACCC in relation to
the exercise of its RKR powers. The Bill does not expand the ACCC’s
existing powers. The direction provides a means of implementing accounting
separation in a timely manner without duplication of existing regulatory powers
and without the complexity and rigidity of specifying the detailed accounts in
legislation. The direction is a disallowable instrument and the costs and
benefits of its provisions would be the subject of examination in a further
regulation impact statement.
To ensure that implementation of the
accounting separation framework is not subject to the delays that have impacted
upon the RAF, the proposed framework would aim to provide for publication of
accounts relating to the 2002-03 financial year by the end of
2003.
Further information on the accounting separation framework will
be announced by the Government when the Bill is introduced in Parliament to
ensure that stakeholders have relative certainty regarding this
initiative.
4. Anti-competitive conduct provisions (Part
XIB)
Part XIB provides an important regulatory tool for the ACCC to use where
it deals with instances of anti-competitive conduct. The issue for
consideration is whether the current provisions in Part XIB strike the right
balance between providing an effective and timely deterrent against
anti-competitive conduct and affording industry participants adequate procedural
fairness and certainty.
To enhance certainty and procedural fairness in the use of Part XIB
without detracting from the effectiveness of the anti-competitive conduct
provisions.
(a) Maintain current provisions
Part XIB provides
industry-specific prohibition against anti-competitive conduct in the
telecommunications industry by supplementing the ACCC’s general
anti-competitive powers in Part IV. The two main differences between Part XIB
and Part IV are: Part XIB makes use of an effect or likely effects test, whereas
Part IV uses a purpose test; Part XIB, but not Part IV, allows the ACCC to issue
competition notices to firms which are allegedly engaging in anti-competitive
behaviour.
The Part XIB provisions recognise that the telecommunications
industry is an extremely complex, horizontally and vertically-integrated
industry where competition is not fully established in some telecommunications
markets. The retention of these provisions was recommended by the PC report (PC
5.1).
Competition notices reverse the onus of proof and are designed to
promptly stop anti-competitive conduct and open the way for substantial
penalties and damages. To the extent they represent an effective deterrent
against anti-competitive conduct, they promote competition and ultimately
benefit consumers. However, at the same time, the receipt of a competition
notice has the potential to have a significant impact on a firm both in terms of
monetary damages and damage to its reputation. Therefore, the issue of a
competition notice must follow an appropriate process and should be carefully
considered.
The current provisions in Part XIB do not place an
obligation on the ACCC to consult with the potential recipient of a competition
notice prior to the issue of that notice. While the ACCC has made it its
practice to enter into such consultation this may not provide sufficient
certainty for firms. Such consultation may have the benefit of assisting the
ACCC to better identify instances of anti-competitive conduct and to prevent
this conduct at an early stage.
The current provisions in Part XIB also
do not provide guidance as to when the ACCC should utilise the Part XIB
provisions as against other remedies. This has led to some concerns that the
success of competition notices may be leading the ACCC to utilise these
provisions in circumstances where a remedy under Part XIC may be a more
appropriate action (see PC report p.197).
These issues may result in
the anti-competitive conduct provisions overreaching their appropriate
boundaries and deterring acceptable pro-competitive conduct.
(b) PC
report recommendations
The PC report recommended a number of
amendments to improve certainty and procedural fairness in the use of Part XIB.
Option (b) is to adopt several of these recommendations. The PC report
recommended:
i. the ACCC be required to develop and publish, after public
consultation, guidelines for deciding which regulatory mechanism is most
appropriate in particular cases (PC 5.5);
ii. Part XIB be amended so that a
competition notice no longer constitutes prima facie evidence of the matters set
out in the notice (PC 5.3);
iii. that a party be allowed to appeal against
the merits of a competition notice, even after its withdrawal (PC 5.2); and
iv. the ACCC be required to issue a public report for all allegations of
anti-competitive conduct which proceeded to formal investigations of a
telecommunications provider's conduct (PC 5.4).
In general, the PC report
recommendations involve procedural changes to establish a more regimented
decision-making process for the ACCC. While these changes may improve
transparency, the cost of these changes is that they would introduce new scope
for firms to frustrate actions against anti-competitive conduct. As noted
above, timeliness of action is very important in the telecommunications
industry, therefore, restricting the ACCC’s ability to act quickly in
response to anti-competitive conduct could have significant costs.
The
publication of non-binding guidelines establishing which regulatory mechanism is
most appropriate may provide valuable information to the market. This would be
weighed against the impact on the ACCC’s resources and any restrictions
that the guidelines may impose on the regulator’s flexibility.
In
most, if not all cases, where the regulator is investigating alleged
anti-competitive conduct there will be significant information asymmetry between
it and the firm being investigated. The reversal of the onus of proof in the
competition notice addresses this imbalance. Removing this function would be
likely to delay the ACCC’s investigation of anti-competitive conduct and
frustrate its ability to prosecute breaches of Part XIB.
Introducing
appeals against the merits of a competition notice may be inconsistent with
measures to ensure timely action to curtail anti-competitive behaviour. It may
also increase the potential for regulatory gaming and increase
delay.
Publication of a report for all allegations of anti-competitive
conduct would improve transparency but it would also be another drain on the
ACCC’s resources. The publication of all allegations, especially if not
proven, may also have the potential to damage the reputation of industry
participants.
(c) Alternative procedural
enhancements
Option (c) is to adopt alternative measures that address
the issues of procedural fairness and certainty in the operation of the
anti-competitive conduct provisions in Part XIB without imposing a more
regimented decision making process on the ACCC.
Firstly, option (c) would
place an obligation on the ACCC to formally consult with the potential recipient
of a Part A competition notice before it issued a notice. This would ensure
that the potential recipient of a Part A competition notice is informed of the
potential issue of that notice, including the instances of anti-competitive
conduct that are proposed to be specified in the notice and is invited to
respond to those allegations. This option would provide certainty for the
potential recipient of a competition notice and, because it accords with
existing ACCC practices, it should not give rise to delay.
Secondly,
option (c) would provide the ACCC with the ability to issue a notice to a person
advising that person of the action it should take, or consider taking, in order
to ensure that it does not engage, or continue to engage, in anti-competitive
conduct. This provision would add to the ACCC’s existing ability to issue
an advisory notice to the recipient of a Part A competition notice under section
151AQB of Part XIB but it provides the additional benefit of issuing the notice
before the Part A competition notice is in force. This option would enable the
potential recipient of a competition notice to obtain greater certainty about
the regulator’s response. The issue of the competition notice would be at
the discretion of the ACCC, therefore it would not further add to the
regulator’s procedural obligations.
Some industry participants argued that the market remains dominated by
the incumbent and that there is a continuing need for strong
telecommunications-specific competition provisions. Others have argued that the
current provisions do not provide sufficient certainty and scope for guidance on
how and when the telecommunications-specific competition provisions will be
exercised. The ACCC has expressed concern that any amendments should not result
in a more complicated decision-making process.
Indications are that there may be some need to improve the process for
dealing with anti-competitive conduct. Therefore, option (a) is not preferred.
However, any improvement to procedural fairness and transparency should not be
made at the cost of rigorous prevention of anti-competitive conduct. For this
reason Items (ii), (iii) and (iv) in option (b) are rejected, as they would
introduce a more regimented decision making process for the ACCC, distract
resources from enforcement activities and give rise to delay. Option (c)
addresses concerns about certainty and procedural fairness without impacting on
the ACCC’s regulatory obligations. It is recommended that Item (i) of
option (b) and option (c) be adopted.
5. Minor changes to the
telecommunications competition regime
Experience with the current competition regime, detailed consultation
with industry and the recommendations of the PC report have highlighted a number
of areas where improvements could be made to the current regime through a series
of minor amendments.
To implement more robust regulatory arrangements by clarifying and
improving the certainty of the current law where necessary, reducing
administrative burden where possible, removing anomalies or inconsistencies
where identified, improving equity amongst parties where possible and providing
for more timely decision making where appropriate.
(a) Make appropriate amendments to the regulatory
framework
This option would involve making minor amendments to the
regulatory framework to make improvements and to rectify identified shortcomings
and inefficiencies. While the amendments could be approached in a number of
ways, the amendments would generally do the following:
• remove
uncertainty in relation to determinations made by the ACCC by clarifying that
the relevant time for assessing “reasonably anticipated
requirements” under subsection 152CQ(1) is the time that a request for
access to a declared service is made (PC 10.14);
• remove inequities
that place all financial responsibilities on access seekers by amending
paragraph 152CQ(1)(f) to restrict the power of the ACCC to make an access
determination where it would require someone other than the access seeker to
bear an unreasonable amount of the costs (rather than some or all of the costs
as is currently the case) (PC 10.15);
• amend paragraph 152EF(1)(b) to
clarify that the obligation to comply with the standard access obligations
exists independently of an ACCC determination (PC 10.16);
• facilitate
access to declared services by clarifying that ordering and provisioning are
taken to be aspects of technical and operational quality for the purposes of the
standard access obligations;
• remove uncertainty by clarifying the
ACCC’s powers to require a party to a determination to pay interest on
sums and to require the ACCC to publish guidelines on the exercise of this power
(PC 10.17(a));
• repeal the provisions relating to the
Telecommunications Access Forum (PC 10.4) and repeal requirements for industry
development plans contained in Part 2 of Schedule 1 of the Telecommunications
Act 1997 (PC 12.1);
• facilitate quicker resolution of
interconnection arrangements by aligning the different procedures and
obligations on service providers to provide information to enable efficient
interconnection between networks contained in Part 4 of Schedule 1 of the
Telecommunications Act 1997 (PC 12.4);
• ensure that
pre-selection is considered within the context of a wider range of regulatory
options by transferring the responsibility for determining which services should
be subject to pre-selection from the Australian Communications Authority to the
ACCC (PC 15.1);
• ensure that the provisions in Part XIB that deal with
the powers and functions of the ACT on a review of a decision of the ACCC under
Part XIB or under Part XIC are consistent and clarify the powers of the ACT
where it reviews a decision o the ACCC to refuse to do
something;
• reduce administrative costs by providing a mechanism for
the ACCC to revoke declarations of minor importance without the need to conduct
a public inquiry (PC 9.9); and
• improve the regulatory scrutiny of
declared services by providing for declarations to “sunset” after
five years, unless the ACCC extends the period of the declaration, after
conducting a public review (PC 9.8).
Amendments that address these issues
would generally benefit all stakeholders. Those amendments that clarify or
remove uncertainty should benefit access seekers and providers by removing scope
for unnecessary confusion and thus costly delay. A number of amendments will
reduce administrative costs for the ACCC and thus reduce the burden on the
industry when these costs are recovered through carrier licence
fees.
(b) Retain the status quo
Maintaining the current
arrangements without change will mean that a number of the inefficiencies and
uncertainties that have been identified will not be addressed. These
arrangements could be continued on the basis that, while imperfect, they have
not frustrated the objectives of the regime. Doing nothing may also save some
administrative costs associated with instituting changes. The status quo may
also benefit service providers to the extent that it hampers the development of
competition and thus helps to maintain their market position.
The PC report and consultations with industry and the ACCC are the main
means by which the Government has become aware of these issues with the current
legislative regime. There is general support for the amendments in option (a)
by stakeholders and the regulator.
It is fairly clear that option (a) is the only realistic option, given
the issues that have been identified. The package of proposed measures is
consistent with the direction of existing regulation, deals with current
concerns within the industry and implements numerous recommendations of the PC
report. It is recommended that option (a) be adopted.
The following abbreviations are used in this explanatory memorandum:
ACA: Australian Communications Authority
ACCC: Australian Competition and Consumer
Commission
ACT: Australian Competition
Tribunal
Bill: Telecommunications Competition Bill 2002
Carrier
Licence Charges Act: Telecommunications (Carrier Licence Charges) Act
1997
Minister: Minister for Communications, Information Technology
and the Arts
PC Report: Productivity Commission report
“Telecommunications Competition Regulation”, Report No. 16, 21
September 2001
Telecommunications Act: Telecommunications Act
1997
TPA: Trade Practices Act 1974
NOTES ON CLAUSES
Clause 1 – Short title
Clause 1 provides that the
Bill, when enacted, may be cited as the Telecommunications Competition Act
2002.
Clause 2 – Commencement
Clause 2 provides that
the Bill, when enacted, will commence on the day on which it receives the Royal
Assent.
Clause 3 – Schedule(s)
Clause 3 provides that
each Act that is specified in a Schedule to the Bill is amended or repealed as
set out in that Schedule and any other Item in a Schedule has effect according
to its terms. There are three Schedules to the Bill. Schedule 1 to the Bill
amends the Telecommunications Act 1997. Schedule 2 to the Bill amends
the Trade Practices Act 1974. Schedule 3 to the Bill amends the
Telecommunications (Carrier Licence Charges) Act 1997.
Schedule
1 – Amendment of the Telecommunications Act 1997
Part 1
– Pre-selection in favour of carriage service providers
Part 1
of Schedule 1 to the Bill contains amendments to Part 17 of the
Telecommunications Act. Under Part 17 of the Telecommunications Act, the ACA
may require certain carriers and carriage service providers to provide
pre-selection in favour of carriage service providers. Pre-selection allows
customers directly connected to the network of one carriage service provider to
have access automatically to another carriage service provider’s services
when they pick up the phone to make certain types of calls. Pre-selection
provided by carriers and carriage service providers must include over-ride dial
codes for selecting alternative carriage service providers on a call-by-call
basis (section 353).
The PC Report recommended that the responsibility
for determining which services should be subject to pre-selection requirements
should be shifted from the ACA to the ACCC, with the ACCC being required to
consult the ACA on technical matters. The purpose of the PC Report
recommendation is to ensure that pre-selection is but one of a wider range of
regulatory options that may facilitate competition in charges for
telecommunications services. Currently, the ACA cannot consider other options
due to its limited powers under the Telecommunications Act in relation to
competition issues.
The amendments in Part 1 of Schedule 1 to the
Bill:
• reverse the current roles of the ACA
and the ACCC under Part 17;
• include a new
proposed section regarding review of decisions by the ACCC to refuse to make a
declaration exempting a carrier or carriage service provider from pre-selection
requirements; and
• contain transitional measures
to provide for the continued effect of determinations, declarations and opinions
made by the ACA under Part 17 prior to the commencement of the
amendments.
Item 1 – Section 5
Section 5 of the
Telecommunications Act contains a simplified outline of the Telecommunications
Act. The outline currently states that the ACA may require certain carriers and
carriage service providers to provide pre-selection in favour of carriage
service providers.
Item 1 amends the outline in section 5 to provide that
the ACCC may require certain carriers and carriage service providers to provide
pre-selection in favour of carriage service providers. The proposed amendment
is consequential to the proposed shift in responsibility for determining
pre-selection requirements from the ACA and to the ACCC under Part 17 of the
Telecommunications Act.
Item 2 – Section 348
Section
348 of the Telecommunications Act contains a simplified outline of Part 17 of
the Act. The simplified outline currently states that the ACA may require
certain carriers and carriage service providers to provide pre-selection in
favour of carriage service providers and that pre-selection must include
over-ride dial codes for selecting alternative carriage service providers on a
call-by-call basis.
Item 2 amends section 348 to change the reference to
the ACA with a reference to the ACCC. The proposed amendment is consequential to
the proposed shift in responsibility for determining pre-selection requirements
from the ACA and to the ACCC under Part 17 of the Telecommunications
Act.
Item 3 – Section 349
Section 349 deals with the
requirement to provide pre-selection. Subsection 349(1) requires the ACA to
make a determination requiring each carrier or carriage service provider who
supplies a standard telephone service to provide pre-selection in favour of a
specified carriage service provider in relation to calls made using a standard
telephone service. Subsection 349(2) provides that the ACA may make a written
determination requiring each carrier or carriage service provider who supplies a
specified carriage service to provide pre-selection in favour of a specified
carriage service provider in relation to calls made using the carriage service.
In making a determination under section 349, the
ACA:
• must have regard to the technical
feasibility as well as the costs and benefits of complying with the
requirement;
• may adopt or incorporate matters
contained in codes or standards; and
• must
consult the ACCC before making the determination.
Item 3 amends section 349 by changing references to the ACA to references to
the ACCC. The purpose of the proposed amendment is to transfer the
responsibility for determining pre-selection requirements from the ACA to the
ACCC to ensure that pre-selection is considered within the context of a wider
range of regulatory options.
Item 4 – Subsection
349(6)
Subsection 349(6) provides that the ACA must consult the ACCC
before making a determination under section 349 about pre-selection
requirements. Item 4 amends subsection 349(6) by changing the reference to the
ACCC to the ACA. The purpose of the proposed amendment is to transfer the
responsibility for determining pre-selection requirements from the ACA to the
ACCC to ensure that pre-selection is considered within the context of a wider
range of regulatory options.
Item 5 – Section
352
Section 352 allows the ACA, by notice in the Gazette, to declare
that a specified carrier or carriage service provider is exempt from a
pre-selection requirement under section 349. In deciding whether to exempt a
carrier or carriage service provider from a pre-selection requirement the ACA
must have regard to whether it would be technically feasible for the carrier or
carriage service provider to comply with the requirement and whether compliance
with the requirement would impose unreasonable financial hardship on the carrier
or carriage service provider (subsection 352(2)). The ACA may also have regard
to other matters (subsection 352(3)).
Item 5 amends section 352 by
changing the references to the ACA to references to the ACCC. The purpose of the
proposed amendment is to transfer the responsibility for determining
pre-selection requirements from the ACA to the ACCC to ensure that pre-selection
is considered within the context of a wider range of regulatory
options.
Item 6 – At the end of section 352
Item 6
inserts a new subsection at the end of section 352. Proposed subsection 352(4)
provides that the ACCC must consult the ACA before making a declaration
exempting a carrier or carriage service provider from a pre-selection
requirement under section 349. This provision ensures that the ACCC will
consult the ACA on any relevant matters. This may include, for example,
technical matters related to pre-selection.
Item 6 also inserts a note at
the end of section 352. The note draws attention to proposed section 352A which
deals with the review of a decision of the ACCC to refuse to make a declaration
under section 352. It is proposed to add section 352A in Part 17 of the
Telecommunications Act to provide that decisions of the ACCC under section 352
will be reviewable by the ACT. Proposed section 352A is required because a
decision made under section 352 will be removed from the list of reviewable
decisions of the ACA in clause 1 of Schedule 4 to the Telecommunications Act as
a consequence of responsibility for the determination of pre-selection
requirements being shifted from the ACA to the ACCC. The purpose of note is
therefore to draw attention to the new provision in the Telecommunications Act
that will allow decisions made under section 352 to be
reviewed.
Item 7 – After section 352
Item 7
inserts a proposed new section after section 352. Proposed section 352A
provides that certain decisions of the ACCC under section 352 will be reviewable
by the ACT. This is consequential to the transfer of the responsibility for
determining pre-selection requirements from the ACA to the ACCC to ensure that
pre-selection is considered within the context of a range of regulatory options.
Currently, a decision by the ACA to refuse to make a declaration under section
352 (ie, not to exempt a carrier or carriage service provider from a
pre-selection requirement) is included in the list of reviewable decisions of
the ACA in clause 1 of Schedule 4 to the Telecommunications Act. Decisions
listed in clause 1 of Schedule 4 may be reconsidered by the ACA and reviewed by
the Administrative Appeals Tribunal. A decision to refuse to make a declaration
under section 352 will be removed from the list in clause 1 of Schedule 4 as a
consequence of the shifting of responsibility for pre-selection requirements
from the ACA to the ACCC.
The purpose of the amendment in Item 7 is
therefore to provide for merits review of a decision by the ACCC to refuse to
make a declaration under section 352. The ACT has been substituted for the
Administrative Appeals Tribunal to maintain consistency with the review body
adopted for other decisions of the ACCC. This substitution will not
substantively alter the rights of those persons whose interests are affected by
a decision under section 352, as reviews by both the Administrative Appeals
Tribunal and the ACT are on the merits. Decisions made by the ACCC will not be
required to be reconsidered by the ACCC before they can be appealed to the ACT.
This is consistent with the processes for review of other decisions made by the
ACCC under the TPA.
Proposed subsections 352A(2), (3) and (4) set out how
a person whose interests are affected by a decision by the ACCC under section
352 may apply for review of the decision by the ACT. Proposed subsections
352A(5), (6), (7), (8) and (9) set out the functions and powers of the ACT in
reviewing the decision.
Item 8 – Subsection
353(2)
Section 353 deals with the use of over-ride dial codes and
applies to a carriage service provider if that carriage service provider
supplies a carriage service that involves the use of a controlled network or a
controlled facility of a carrier, of itself or another carriage service provider
and the network or facility is required to provide over-ride dial codes for the
selection of alternative carriage service providers on a call-by-call basis
(subsection 353(1)). If section 353 applies to a carriage service provider,
that carriage service provider must take all necessary steps to ensure that each
end-user of the carriage service is able to make use of the codes for selecting
alternative carriage service providers, unless, in the ACA’s opinion, it
would not be technically feasible or it would impose unreasonable financial
hardship (subsection 353(2)).
Item 8 amends subsection 353(2) to change
the reference to the ACA to the ACCC so that the obligation to take all
necessary steps to ensure that each end-user of the carriage service is able to
make use of the codes for selecting alternative carriage service providers would
apply, unless, in the ACCC’s opinion, it would not be technically feasible
or it would impose unreasonable financial hardship. The purpose of the proposed
amendment is to transfer the responsibility for determining pre-selection
requirements from the ACA to the ACCC to ensure that pre-selection is considered
within the context of a wider range of regulatory options.
Item 9
– Paragraph 1(n) of Schedule 4
Item 9 repeals paragraph 1(n) of
Schedule 4 to the Telecommunications Act. The proposed amendment will remove
from the list of decisions of the ACA that may be reconsidered by the ACA and
reviewed by the Administrative Appeals Tribunal in clause 1 of Schedule 4 a
decision of the ACA made under section 352 to refuse to make a declaration. The
proposed amendment is consequential to the responsibility for making decisions
under section 352 being shifted from the ACA to the ACCC. The function of
having the original decision-maker review its own decision before providing for
appeal to an external body will not be replicated in the TPA. This is
consistent with the processes for review of other decisions made by the ACCC
under the TPA.
Item 10 – Transitional – section 349 of the
Telecommunications Act 1997
Item10 is a transitional provision
that applies to a determination that was made under section 349 (ie a
determination in relation to pre-selection requirements) and that was in force
before the commencement of Item 10. The proposed amendment provides that such a
determination will continue in effect after the commencement of Item 10 as if
the determination had been made by the ACCC and any requirement imposed by
section 349 in relation to the making of the determination had been satisfied
(for example, the requirement to have regard to the matters in subsection 349(3)
and consultation with the ACA (subsection 349(6)).
Item 11 –
Transitional – section 352 of the Telecommunications Act
1997
Item 11 is a transitional provision that applies to a
declaration that was made under section 352 (ie a declaration that a carrier or
carriage service provider is exempt from a pre-selection requirement imposed
under section 349) and that was made before the commencement of Item 11. The
proposed amendment provides that such a declaration will continue in effect
after the commencement of Item 11 as if the declaration had been made by the
ACCC and any requirement imposed by section 352 in relation to the making of the
declaration had been satisfied (for example, the requirement to have regard to
the matters in subsection 352(2)).
Item 12 – Transitional – reconsideration and review of certain
decisions under section 352 of the Telecommunications Act
1997
Item 12 is a transitional provision that applies to a
decision of the ACA to refuse to make a declaration under section 352 (to exempt
a carrier or carriage service provider from a pre-selection requirement) where
the decision was made before the commencement of Item 12. The proposed
amendment provides that Part 29 (Review of Decisions) and Schedule 4 (Reviewable
Decisions of the ACA) to the Telecommunications Act will continue to apply to
decisions to which Item 12 applies and those decisions will continue in effect
after the commencement of Item 12 as if they had been made by the ACCC. The
ACCC will be substituted for the ACA as a party to any proceedings in the
Administrative Appeals Tribunal that were pending immediately before the
commencement of Item 12 and are related to a decision to which Item 12
applies.
Item 13 – Transitional – section 353 of the
Telecommunications Act 1997
Item 13 is a transitional
provision that applies to an opinion that was formed by the ACA under subsection
353(2) (ie that provision of over-ride dial codes would not be technically
feasible or it would impose unreasonable financial hardship on a carriage
service provider) and that was in existence immediately before the commencement
of Item 13. The proposed amendment provides that such an opinion will continue
in effect after the commencement of Item 13 as if the opinion had been formed by
the ACCC under subsection 353(2). The proposed amendment is not intended to
prevent the ACCC from revoking or varying the relevant opinion at a later
time.
Part 2 – Industry development plans
Under the Telecommunications Act, the ACA cannot grant a carrier licence to a
person unless that person has given an industry development plan (IDP) to the
Industry Minister and the Industry Minister has approved the IDP (subclause 4(1)
of Schedule 1). A carrier is required to have a current IDP plan at all times
(subclause 4(2)). Subclause 4(3) of Schedule 1 provides that for the purposes
of subclause 4(2), a carrier has a current IDP if the carrier has given the plan
to the Industry Minister and the Industry Minister has approved the plan. For
the purposes of Part 2 of Schedule 1 to the Act, “Industry Minister”
is defined in clause 3 to mean either the Minister for Communications,
Information Technology and the Arts or the Minister for the Arts and Sport
(because of the Acts Interpretation (Substituted References – Section
19B) Amendment Order 2001 made by the Governor-General on 20 December 2001
changed the reference in clause 3 of Schedule 1 to the “Minister for the
Arts and Centenary of Federation” is read as the “Minister for the
Arts and Sport”).
Carriers are required to make a summary of their
IDPs publicly available and must report annually on their IDP achievements to
the Industry Minister. The Industry Minister must table annual reports in
Parliament on IDP achievements. The aim in requiring carriers to prepare and
publish IDPs was to assist the development of the Australian telecommunications
industry by encouraging carriers to undertake activities that contributed to the
growth of the industry.
IDPs deal with a carrier’s strategic
commercial relationships, research and development activities, export
development and employment and training. All commitments, other than those in
respect of research and development, are, in a formal sense,
voluntary.
The PC Report recommended that the legal requirement for IDPs
be repealed, concluding that there is no compelling argument for continuing with
the operation of IDPs because:
• established
carriers have had individual plans in place for many years and therefore any
possible market failures would have been substantially
overcome;
• IDPs of a limited number of new
carriers that are essentially resellers or serving a regional or limited
telecommunications market are likely to have very little impact on the local
equipment industry overall;
• there are some
costs to carriers of preparing, obtaining approval and reporting annually on the
progress of IDPs. There is also a small administrative cost to government;
and
• with the exception of commitments in
relation to research and development, other commitments made by carriers in IDPs
are in a formal sense voluntary.
As IDPs have little impact on industry
practice and represent a cost burden to carriers in their preparation, it is
proposed to remove the requirement for IDPs in relation to carrier licensing.
The amendments in Part 2:
• repeal the
legislative basis for IDPs; and
• provide a
transitional provision to require carriers to provide a final report on the
implementation of their IDPs for the period before the commencement of the
amendments and for the Industry Minister to table an annual report in Parliament
for that period in relation to the progress made by carriers in respect of their
IDPs.
Item 14 – Part 2 of Schedule 1
Item 14 repeals Part 2
of Schedule 1 to the Telecommunications Act. The purpose of the proposed
amendment is to remove the legal requirement for IDPs in relation to carrier
licensing.
Item 15 – Transitional – clauses 14 and 15 of Schedule 1 to
the Telecommunications Act 1997
Item 15 is a transitional
provision that relates to the requirements of clauses 14 and 15 of Part 2 of
Schedule 1 to the Telecommunications Act. Clause 14 requires carriers with
current industry development plans (IDPs) to give the Industry Minister, within
90 days of the end of each financial year, a report setting out the
carrier’s progress in implementing its IDP for the year and to make a
summary of this report available to the public. Clause 15 requires the Industry
Minister, within 6 months of the end of each financial year, to prepare, and
table in both Houses of Parliament, a report relating to the progress made by
carriers in implementing current IDPs during the financial year.
Item 15
provides that clauses 14 and 15 of Schedule 1 will continue to apply as if each
reference to a financial year in those clauses is a reference to
“pre-commencement reporting period” and the amendment in Item 14 had
not been made. “Pre-commencement reporting period” is a financial
year that began on or after 1 July 1997 and ended before the commencement of
Item 15 or, if Item 15 does not commence on a 1 July, the period at the start of
the financial year in which Item 15 commenced and ending immediately before Item
15 commenced. This will effectively require carriers and the Industry Minister
to prepare a final report on the implementation of IDPs in respect of the period
that has not been the subject of reports by carriers and the Industry Minister
but had ended with the commencement of Item 14.
Part 3 – Access
to network information
Under Part 4 of Schedule 1 to the
Telecommunications Act, carriers must provide other carriers with access to
certain information to ensure efficient inter-connection between networks. This
includes information:
• from the
carrier’s operations support
systems;
• about traffic
flow;
• that is contained in a database that
relates to the manner in which that carrier’s telecommunications networks
treats calls of a certain kind;
• about network
planning (including volume or characteristics of traffic being offered and
telecommunications performance
standards);
• about likely changes to facilities
on a telecommunications network of a first carrier that will affect the
completion success rates of calls offered by a second carrier;
and
• about quality of service.
The access
obligations under Part 4 differ slightly depending on the type of information
involved. However, as no particular type of information under Part 4 has
greater importance or status than other types of information dealt with by Part
4, the PC Report recommended that the obligations under Part 4 be aligned.
The amendments in Part 3 of Schedule 1 to the Bill align the various
procedures and obligations on service providers to provide information to enable
efficient inter-connection between networks. These amendments will result in
uniform obligations in relation to access to information as
follows:
• the obligation will be to provide
timely and detailed information; and
• the
obligation will not apply unless a purpose of the access is to enable a carrier
to undertake planning, maintenance or reconfiguration of its telecommunications
network; and
• a service provider will not be
obliged to comply with a request for information unless it is
reasonable.
Item 16 – Paragraph 21(2)(a) of Schedule
1
Clause 21 of Schedule 1 applies to a carrier (the first carrier) if
the first carrier supplies carriage services to another carrier (the second
carrier). Paragraph 21(2)(a) requires the first carrier, where requested to do
so by the second carrier, to provide the second carrier with reasonable access
to information about the first carrier’s operations support
systems.
Item 16 amends paragraph 21(2)(a) by adding the requirement that
the first carrier must provide timely and detailed information about its
operations systems to the second carrier. This will make the obligation to
provide information in paragraph 21(2)(a) consistent with the similar
obligations in subclauses 23(2), 24(2) and 25(2). The purpose of the proposed
amendment is to implement the PC Report recommendation that the obligations to
provide network information in Part 4 of Schedule be aligned.
Item 17
– Paragraph 21(2)(b) of Schedule 1
Clause 21 of Schedule 1
applies to a carrier (the first carrier) if the first carrier supplies carriage
services to another carrier (the second carrier). Paragraph 21(2)(b) requires
the first carrier, where requested to do so by the second carrier, to provide
the second carrier with reasonable access to traffic flow
information.
Item 17 amends paragraph 21(2)(b) by adding the requirement
that the first carrier must provide timely and detailed traffic flow information
to the second carrier. This will make the obligation to provide information in
paragraph 21(2)(b) consistent with the similar obligations in subclauses 23(2),
24(2) and 25(2). The purpose of the proposed amendment is to implement the PC
Report recommendation that the obligations to provide network information in
Part 4 of Schedule be aligned.
Item 18 – Subclause 21(3) of Schedule 1
Clause 21 of
Schedule 1 applies to a carrier (the first carrier) if the first carrier
supplies carriage services to another carrier (the second carrier). Subclause
21(2) requires the first carrier, where requested to do so by the second
carrier, to provide the second carrier with reasonable access to information
about the first carrier’s operations support systems and traffic flow.
Subclause 21(3) provides that the first carrier is not required to comply with a
request from the second carrier unless the sole purpose of the access is to
enable the second carrier to undertake planning, maintenance or reconfiguration
of the second carrier’s telecommunications network.
Item 18 repeals
subclause 21(3) and replaces it with new proposed subclause 21(3). The effect
of the proposed amendment will be that the first carrier will not be required to
comply with a request for information by a second carrier under subclause 21(2)
unless a purpose of the access is to enable the second carrier to undertake
planning, maintenance or reconfiguration of the second carrier’s
telecommunications network and the request is reasonable. The purpose of the
proposed amendment is to implement the PC Report recommendation that the
obligations to provide network information in Part 4 be aligned.
Item 19 – Subclause 22(2) of Schedule 1
Clause 22 of
Schedule 1 applies to a carrier (the first carrier) if the first carrier
supplies carriage services to another carrier (the second carrier). Subclause
22(2) requires the first carrier, where requested to do so by the second
carrier, to provide the second carrier with reasonable access to information
contained in the first carrier’s databases that relates to the manner in
which the first carrier’s telecommunications network treats calls of a
particular kind.
Item 19 amends subclause 22(2) by adding the requirement
that the first carrier must provide timely and detailed information to the
second carrier. This will make the obligation to provide information in
subclause 22(2) consistent with the similar obligations in subclauses 23(2),
24(2) and 25(2) and the proposed amendments in Items 16 and 17. The purpose of
the proposed amendment is to implement the PC Report recommendation that the
obligations to provide network information in Part 4 of Schedule be
aligned.
Item 20 – Subclause 22(3) of Schedule 1
Clause
22 of Schedule 1 applies to a carrier (the first carrier) if the first carrier
supplies carriage services to another carrier (the second carrier). Subclause
22(2) requires the first carrier, where requested to do so by the second
carrier, to provide the second carrier with reasonable access to information
contained in the first carrier’s databases that relates to the manner in
which the first carrier’s telecommunications network treats calls of a
particular kind. Subclause 22(3) provides that the first carrier is not
required to comply with a request from the second carrier unless the sole
purpose of the access is to enable the second carrier to undertake planning,
maintenance or reconfiguration of the second carrier’s telecommunications
network.
Item 20 repeals subclause 22(3) and inserts new proposed
subclause 22(3). The effect of the proposed amendment will be that the first
carrier will not be required to comply with a request for information by a
second carrier under subclause 22(2) unless a purpose of the access is to enable
the second carrier to undertake planning, maintenance or reconfiguration of the
second carrier’s telecommunications network and the request is reasonable.
The purpose of the proposed amendment is to implement the PC Report
recommendation that the obligations to provide network information in Part 4 be
aligned.
Item 21 – Subclause 23(2) of Schedule
1
Clause 23 of Schedule 1 applies to a carrier (the first carrier) if
the first carrier supplies carriage services to another carrier (the second
carrier). Subclause 23(2) requires the first carrier, where requested to do so
by the second carrier, to provide the second carrier with timely and detailed
telecommunications network planning information that is sufficient to enable the
second carrier to undertake planning for the second carrier’s
telecommunications network.
Item 21 amends subclause 23(2) so that the
first carrier’s obligation will be to provide timely and detailed
telecommunications network planning information. This will mean that the
obligation to provide information will be consistent with similar obligations in
subclauses 21(2), 22(2), 24(2) and 25(2) as amended. The purpose of the
proposed amendment is to implement the PC Report recommendation that the
obligations under Part 4 be aligned.
Item 22 – Subclause 23(4) of Schedule 1
Clause 23 of
Schedule 1 applies to a carrier (the first carrier) if the first carrier
supplies carriage services to another carrier (the second carrier). Subclause
23(2) requires the first carrier, where requested to do so by the second
carrier, to provide the second carrier with timely and detailed
telecommunications network planning information that is sufficient to enable the
second carrier to undertake planning for the second carrier’s
telecommunications network. Subclause 23(4) provides that the first carrier is
not required to comply with subclause 23(2) unless the second carrier’s
request is reasonable.
Item 22 amends subclause 23(4) to include an
additional pre-condition to the first carrier’s obligation to provide
requested information. The first carrier will not be required to comply with
the request unless a purpose of the provision of the information is to enable
the second carrier to undertake planning for its own telecommunications network
and the request is reasonable. Proposed subclauses 21(3), 22(3) and 24(3) have
a similar requirement (see Items 18, 20 and 23). The purpose of the amendment
is to implement the PC Report recommendation that the obligations in Part 4 be
aligned.
Item 23 – Subclause 24(3) of Schedule 1
Clause 24 of
Schedule 1 applies to a carrier (the first carrier) if the first carrier
supplies carriage services to another carrier (the second carrier). Subclause
24(2) requires the first carrier, where requested to do so by the second
carrier, to provide the second carrier with timely and detailed information
about quality of service and other information. Subclause 24(3) provides that
the first carrier is not required to comply with a request for information
unless the second carrier’s request is reasonable.
Item 23 amends
subclause 24(3) to include an additional pre-condition to the first
carrier’s obligation to provide requested information. The first carrier
will not be required to comply with the request unless a purpose of the
provision of the information is to enable the second carrier to undertake
planning for its own telecommunications network and the request is reasonable.
Proposed subclauses 21(3), 22(3) and 23(4) have a similar requirement (see Items
18, 20 and 22). The purpose of the proposed amendment is to implement the PC
Report recommendation that the obligations in Part 4 be aligned.
Item 24 – Transitional – clauses 21, 22 and 23 of Schedule 1
to the Telecommunications Act 1997
Item 24 is a transitional
provision that applies to a request that was made under subclause 21(2), 22(2)
or 23(2) of Schedule 1 and that was in force before the commencement of Item 24.
Item 24 provides that such a request has effect after the commencement of 24 as
if it had been made under, and in the terms required by, proposed subclauses
21(2), 22(2) or 23(2).
Schedule 2 – Amendment of the Trade
Practices Act 1974
Part 1 – Model terms and conditions
relating to access to core services etc.
Part 1 contains amendments
to require the ACCC to publish non-binding model terms and conditions of access
for each of the following “core
services”:
• the Domestic Public
Switched Telephone Network (PSTN) Originating Access Service;
• the Domestic Public Switched Telephone Network
(PSTN) Terminating Access Service;
• the
Unconditioned Local Loop Service;
• the Local
Carriage Service; and
• a declared service
specified in the regulations.
The ACCC will be required to take all
reasonable steps to ensure that it publishes model terms and conditions (by way
of a written determination) of access for these core services within 6 months of
commencement of the Bill and, in the case of a declared service specified as a
core service in the regulations, within 6 months after the relevant regulation
takes effect.
The aim of releasing model terms and conditions is to
assist parties to reach commercial agreement on terms and conditions for access,
or to submit access undertakings, thus providing more timely access for access
seekers to “core” fixed line network services. This is in line with
the underlying philosophy of the telecommunications access regime in Part XIC
that is focussed on the terms and conditions of access being established through
commercial agreement or being set out in access undertakings.
While these
model terms and conditions will not be binding, they will provide clear guidance
about the regulator’s views as to what fair terms and conditions for
access would be, including price. The model terms and conditions would be based
on an assessment of the current market conditions and would be in a form that
could be easily incorporated into an access undertaking. If a dispute about
terms and conditions then arose between parties, any subsequent ACCC arbitration
decision (determination) would be expected to reflect the model terms and
conditions.
The availability of model terms and conditions is designed to
overcome the uncertainty that currently exists prior to regulatory arbitrations
as to what the regulator’s likely views may be concerning the eventual
terms and conditions of access. Up-front provision of this information is
likely to assist the commercial negotiation process by giving parties a view of
what the likely outcome of an ACCC determination on the issue would be. This is
intended to bring the parties’ negotiating position closer together, thus
expediting and simplifying the commercial negotiation process.
Item 1
– After subsection 152AQA(7)
Section 152AQA requires the ACCC
to determine pricing principles relating to the price of access to a declared
service. Subsection 152AQA(6) provides that the ACCC must have regard to the
determination if it is required to arbitrate an access dispute under Division 8
of Part XIC in relation to the declared service. Subsection 152AQA(7) provides
that a determination has no effect to the extent that it is inconsistent with
any Ministerial pricing determination which is made under Division 6 of Part XIC
(section 152CH).
Item 1 inserts a new proposed subsection at the end of
section 152AQA. The proposed amendment makes it clear that neither section
152AQA nor any pricing determination made under that section limits the
ACCC’s powers under Division 4 (Telecommunications Access Code) or
Division 5 (Access Undertakings). The purpose of the amendment is to ensure
that the existence of a pricing determination does not prevent the ACCC from
considering and/or accepting a telecommunications access code (under Division 4)
or an access undertaking (under Division 5) the terms of which are inconsistent
with a pricing determination made under section 152AQA. The proposed amendment
will ensure that section 152AQA is consistent with proposed section 152AQB (Item
2).
Item 2 – After section 152AQA
Item 2 inserts a
new proposed section after section 152AQA. Proposed section 152AQB will require
the ACCC to make a written determination of model terms and conditions relating
to access to each core service.
Core services are those service
specified in the Bill to be core services and those services specified by
regulation to be core services. The services specified in proposed section
152AQB as a core service are:
• the Domestic
Public Switched Telephone Network (PSTN) Originating Access Service;
• the Domestic Public Switched Telephone Network
(PSTN) Terminating Access Service;
• the
Unconditioned Local Loop Service; and
• the Local
Carriage Service.
Each of these services has been previously declared
under section 152AL.
The services have been specified in the proposed
amendment by reference to the description of the particular service in the
relevant declaration. This will ensure that changes in the description of the
service in the relevant declaration will not affect the application of proposed
section 152AQB and that the deemed declaration of the Domestic Public Switched
Telephone Network (PSTN) Originating Access Service and the Domestic Public
Switched Telephone Network (PSTN) Terminating Access Service (by virtue of
section 39 of the Telecommunications (Transitional Provisions and
Consequential Amendments) Act 1997) is accommodated. A variation of a
deemed declaration will also be covered by the reference to the description of
the service.
The ACCC must take all reasonable steps to ensure that a
determination relating to the Domestic PSTN Originating Service, the Domestic
PSTN Terminating Service, the Unconditioned Local Loop Service and the Local
Carriage Service is made within 6 months after the commencement of Item 2. In
the case where a declared service is specified in the regulations to be a core
service, the ACCC will be required to make a determination relating to that core
service within 6 months of the making of the relevant regulations. It is
intended that the model terms and conditions will not need to be comprehensive;
the ACCC will be able to publish any or all of the model terms and conditions
relating to a core service.
The proposed amendment sets out the procedure
for making a determination. Before making a determination relating to a core
service, the ACCC will be required to undertake public consultation on the
determination (by publishing a draft determination, inviting submissions from
the public on the draft determination and considering those submissions) and to
consult with the ACA about the determination.
A determination in relation
to a particular core service will cease to be in force 5 years after the day on
which it is made (unless revoked earlier) or at the end of any longer period
specified by regulation. The ACCC will be required to publish a determination
in a manner that it considers appropriate (including in electronic
form).
If the ACCC is required to arbitrate an access dispute in relation
to a core service covered by a determination, the ACCC will be required to have
regard to that determination in arbitrating the dispute (proposed subsection
152AQB(9)). This is a similar requirement to that that exists in relation to
the pricing principles (section 152AQA). However, proposed subsection 152AQB(9)
is not intended to preclude the ACCC from considering the model terms and
conditions in other contexts unrelated to core services.
A determination
made under proposed 152AQB will have no effect to the extent that it is
inconsistent with any Ministerial pricing determination or a determination made
under section 152AQA (pricing principles). The proposed amendment makes it clear
that neither proposed section 152AQB nor any determination made under it will
limit the ACCC’s powers under Division 4 (Telecommunications Access Code)
or Division 5 (Access Undertakings). This is to ensure that the existence of a
determination relating to core services will not prevent the ACCC from
considering and/or accepting a telecommunications access code (under Division 4)
or an access undertaking (under Division 5) the terms of which are inconsistent
with the determination. Proposed section 152AQB will not preclude the ACCC from
dealing with price-related terms and conditions under the proposed section as
well as under section 152AQA (pricing principles).
Item 3 –
Subsection 152CH(1) (before note 2)
Item 3 inserts two new notes
before note 2 to subsection 152CH(1). Proposed note 1A draws attention to
subsection 152AQA(7) which provides that a determination under section 152AQA
(pricing principles) has no effect to the extent that it is inconsistent with
any Ministerial pricing determination. Proposed note 1B draws attention to
proposed subsection 152AQB(9) (see Item 2) which provides that a determination
under proposed 152AQB (model terms and conditions) will have no effect to the
extent that it is inconsistent with a Ministerial pricing determination or a
determination under section 152AQA. The proposed amendment is consequential to
the proposed amendment in Item 2.
Item 4 – Section 152CLA
(note)
Section 152CLA provides that the ACCC must, in exercising its
powers under Division 8 of Part XIC (which deals with the resolution of disputes
about access), have regard to the desirability of access disputes being resolved
in a timely manner. The note to section 152CLA draws attention to the
requirement for the ACCC to have regard to the relevant pricing determination
made under section 152AQA in exercising its powers under Division 8.
Item 4 amends this note by adding to it the requirements for the ACCC to
have regard to the matters set out in 152CR and, in the case of core services,
to any relevant determination made under section 152AQB, in exercising its
powers. The proposed amendment is consequential to the proposed amendment in
Item 2.
Part 2 – Merits review of final
determinations
Section 152DO in Part XIC of the TPA enables a party
to a final determination made by the ACCC in relation to an access dispute to
make a written application for a review of the final determination by the ACT.
A review by the ACT is a re-arbitration of the access dispute (subsection
152DO(3)) and is based on the information and evidence given, and the documents
produced, to the ACCC in connection with the making of the final determination
(and any other information referred to in the ACCC’s reasons for the
making of the determination) (section 152DOA).
Part 2 of Schedule 2 to
the Bill contains amendments to remove the right of a party to seek merits
review by the ACT in relation to final determinations made by the ACCC. The
amendments will not affect the ability of a party to seek merits review of
decisions of the ACCC under Part XIC to accept or reject an application for an
exemption order under section 152AT or an access undertaking under section
152BU, nor the ability to seek judicial review of a final
determination.
Removing merits review of ACCC determinations recognises
the significant delays that have resulted from the review process in the past
and that new entrants seeking access to telecommunications infrastructure have
difficulty raising or committing capital during the review process due to the
contingent liability of an unfavourable outcome via, for example, a backdated
determination or review decision. Removing merits review is also intended to
promote certainty for access seekers by streamlining the decision-making
process. It will provide for consistency in decision-making and, in combination
with the publication of model terms and conditions under proposed section
152AQB, it will further promote the likelihood that parties will reach
commercial agreement on the terms and conditions for access.
Item 5
– Subsections 152DN(2) to (8)
Item 5 repeals subsections
152DN(2) to (8). Subsections 152DN(2) to (8) allow the operation and
implementation of a final determination to be stayed upon orders of the ACT
(under subsection 152DN(2)) in order to ensure that a review of the ACT is
effective. Subsection 152DN(3) allows the ACT to make an order to vary or
revoke an order made under subsection 152DN(2). Subsection 152DN(4) provides
that an order made under subsection (2), including an order varied under
subsection (3), is subject to any conditions specified in the order and has
effect until the end of the period specified in the order or the finalisation of
the ACT’s review. Subsection 152DN(5) provides that if a final
determination is stayed, and there was an interim determination in force
immediately before the final determination took effect, the interim
determination remains in force until the end of any period specified in the
order, the finalisation of the review or the revocation of the interim
determination. Subsection 152DN(6) provides that the ACCC may make an interim
determination while a final determination is stayed. Subsections 152DN(7) and
(8) relate to the making of interim determinations by the ACCC.
The
proposed repeal of subsections 152DN(2) to (8) is consequential to the removal
of the right of a party to seek review by the ACT of a final determination made
by the ACCC in relation to an access dispute because these subsections deal with
the interim arrangements that apply whilst the ACT is finalising a review of a
final determination.
Item 6 – Subsection
152DNA(3)
Subsection 152DNA(1) allows some or all of the provisions
of a final determination to be backdated, so that specified provisions can be
expressed to have taken effect earlier than the date on which the determination
took effect. Subsection 152DNA(3) provides that for the purposes of subsection
152CPA(9) and 152DN(5) and (6), in determining the time when a final
determination takes effect, a provision in a determination covered by subsection
152DNA(1) is to be disregarded. This means that the backdating of some or all
of the provisions in a final determination will not affect the operation of
interim determinations whilst a review is being finalised.
Item 6 amends
subsection 152DNA(3) to remove reference to subsections 152DN(5) and (6). The
proposed amendment is consequential to the proposed repeal of subsections
152DN(5) and (6) (see Item 5).
Item 7 – Subsection
152DNA(5)
Subsection 152DNA(1) allows some or all of the provisions
of a final determination to be backdated, so that specified provisions can be
expressed to have taken effect earlier than the date on which the determination
took effect. Subsection 152DNA(5) provides that section 152DNA has effect
despite anything in subsection 152DN(1). Subsection 152DN(1) provides that a
final determination has effect 21 days after it is made.
Item 7 amends
subsection 152DNA(5) by omitting the reference to subsection 152DN(1) and
replacing it with a reference to section 152DN. The proposed amendment is
consequential to the proposed repeal of subsections 152DN(2) to (8) (see Item
5).
Item 8 – Subdivision F of Division 8 of Part
XIC
Subdivision F of Part XIC deals with the review of final
determinations by the ACT. The matters dealt with by Subdivision F include the
right to seek review of a final determination by the ACT, the matters that the
ACT may have regard to for the purposes of a review, appeals to the Federal
Court from determinations of the ACT on questions of law and the operation and
implementation of a determination of the ACT that is the subject of an
appeal.
Item 8 repeals Subdivision F. The effect of the proposed
amendment will be to remove the right of a party to an access dispute to seek
review of a final determination made by the ACCC by the ACT.
Item 9 – Transitional – review of
determinations
Item 9 is a transitional provision that applies if a
final determination was made by the ACCC under subsection 152DO(1) before the
commencement of Item 9. Despite the proposed amendments in Part 2, the TPA will
apply to such a final determination as if the amendments in Part 2 had never
been made. This means that it will be possible to seek review by the ACT of a
final determination made by the ACCC before the commencement of Item 9 (where an
application is made within the time provided by subsection 152DO(2)). The TPA
will apply to such a review as if the amendments removing the right to seek
review had never been made.
The effect of this provision is to preserve
the right of appeal of parties to any final determinations made by the ACCC
before the date of commencement of the Bill where an application for appeal has
been lodged or where parties have a right of appeal at the time of commencement
of the Bill.
Part 3 – Duration of
declarations
Section 152AL allows the ACCC to declare that a
specified eligible service is a “declared service” if the
Telecommunications Access Forum (TAF) has made a recommendation that the ACCC do
so (subsection 152AL(2)) or if the ACCC has held a public inquiry about a
proposal to make the declaration (subsection 152AL(3)). “Eligible
service” is defined as a listed carriage service (within the meaning of
the Telecommunications Act) or a service that facilitates the supply of a listed
carriage service where the service is supplied, or capable of being supplied, by
a carrier or carriage service provider.
In making a declaration under
section 152AL, the ACCC is currently not required to specify an expiry date for
the declaration. If the ACCC declares an eligible service to be a declared
service, the declaration can only be revoked or varied following the holding of
a public inquiry (section 152AO), except where a variation is minor in nature,
in which case the variation can be made without a public inquiry.
The
amendments in Part 3 will require the ACCC to specify an expiry date for
declarations made under section 152AL which may be up to 5 years after the
making of the declaration. The ACCC will be able to extend (and further extend)
the expiry date of a declaration for a period of up to 5 years, provided that
the ACCC has held a public inquiry about a proposal to extend (or further
extend) the expiry date of a declaration. A transitional provision in Part 3
will apply to declarations made by the ACCC before the commencement of the
proposed amendments. The ACCC will be required to determine an expiry date for
existing declarations and the proposed amendments will apply to each such
declaration as if that expiry date had been specified in the declaration. The
expiry date specified in the determination must occur within the 5-year period
beginning on the commencement of the amendments. The ACCC will be required to
make such a determination for all declarations that were in force immediately
before the commencement of the amendments within 6 months of the commencement of
the amendments.
The purpose of the amendments in Part 3 is to implement
the PC Report recommendations that Part XIC should include a provision for the
sunsetting of declarations and that the maximum duration of a declaration should
not exceed 5 years, unless a further inquiry recommends its extension. If a
public inquiry is not held, or the public inquiry does not recommend extension,
the declaration will automatically lapse. The purpose of the proposed
amendments is to ensure that there is no redundant persistence of access regimes
and reflects the possibility that the underlying motives for declaring a
particular service may vanish over time with technological change, the
declaration of substitute services or maturing competition in facilities.
Item 10 – After section 152AL
Item 10 inserts a new
proposed section after section 152AL. Proposed section 152ALA provides that a
declaration must specify an expiry date (proposed subsection 152ALA(1)). The
expiry date must occur within 5 years from the making of the declaration
(proposed subsection 152ALA(2)). A declaration will cease to be in force on the
expiry date specified, unless it is revoked prior to that date or it is
extended, or further extended, by the ACCC following a public inquiry held in
accordance with the provisions in Part 25 of the Telecommunications Act. An
extension, or further extension, cannot be for a period more than 5 years after
the expiry date of the relevant declaration. A declaration will be able to be
further extended more than once. If a declaration does cease to be in force,
the ACCC will not be prevented from subsequently making another declaration in
similar terms to the expired declaration (proposed subsection
152ALA(6)).
The purpose of the proposed amendment is to implement the PC
Report recommendations that Part XIC should include a provision for the
sunsetting of declarations and that the maximum duration of a declaration should
not exceed 5 years, unless a further inquiry recommends its extension.
Item 11 – At the end of subsection
152AM(1)
Section 152AM deals with public inquiries by the ACCC about
proposals to declare services. Section 152AM:
• allows the ACCC to hold a public inquiry
on its own initiative or if requested in writing to do so by a
person;
• provides that, where the ACCC decides
not to hold a public inquiry as requested by a person, the ACCC must notify the
person of this decision and give reasons for it;
and
• requires the ACCC to give a copy of a
report prepared in relation to the public inquiry to the ACA and the
Telecommunications Access Forum, and to the person who requested the inquiry, if
the inquiry was requested by a person.
Subsection 152AM(1) provides that
section 152AM applies to a public inquiry of a kind mentioned in paragraph
152AL(3)(a) (which requires the ACCC to hold a public inquiry about a proposal
to declare an eligible service to be a declared service). Item 11 adds a
reference to paragraph 152ALA(4)(b) at the end of subsection 152AM(1). This
will mean that the provisions in section 152AM relating to public inquiries held
by the ACCC will apply to a public inquiry held about a proposal to extend, or
further extend, the expiry date of a declaration that declares an eligible
service to be a declared service (as will be required by the proposed amendment
in Item 10). The proposed amendment is consequential to the proposed amendment
in Item 10.
Item 12 – At the end of subsection
152AN(1)
Subsection 152AN(1) allows the ACCC to combine two or more
public inquiries of a kind mentioned in paragraph 152AL(3)(a) (which requires
the ACCC to hold a public inquiry about a proposal to declare an eligible
service to be a declared service). If the ACCC decides to do so, it may publish
a single notice informing the public of the combined inquiry, prepare a single
discussion paper and hold hearings relating to the combined inquiry and ensure
that each report is covered by a report under section 505 of the
Telecommunications Act.
Item 12 adds a reference to paragraph
152ALA(4)(b) at the end of subsection 152AN(1). This will mean that the
provisions in section 152AN relating to combined public inquiries will be able
to apply to public inquiries held about a proposal to extend, or further extend,
the expiry date of declarations that declare an eligible service to be a
declared service (as will be required by the proposed amendment in Item 10).
The proposed amendment is consequential to the proposed amendment in Item
10.
Item 13 – Paragraph 152AQ(2)(c)
Under section
152AQ, the ACCC must keep a Register in relation to declarations under section
152AL. Paragraph 152AQ(2)(c) provides that one of the things to be included in
the Register are copies of reports prepared in accordance with section 505 of
the Telecommunications Act in relation to inquiries mentioned in paragraph
152AL(3)(a) or subsection 152AO(2) of the TPA.
Item 13 amends paragraph
152AQ(2)(c) by inserting a reference to proposed paragraph 152ALA(4)(b), which
will require a public inquiry to be held about a proposal to extend, or further
extend, the expiry date of a specified declaration. The purpose of the proposed
amendment is to ensure that copies of reports prepared in accordance with
proposed paragraph 152ALA(4)(b) will be included in the Register.
Item
14 – After section 152DNB
Item 14 inserts a new section after
section 152DNB. Proposed section 152DNC will apply if a declaration made under
section 152AL expires and a final determination was in force in relation to the
declared service concerned immediately before the expiry of the declaration and
that determination does not have an indefinite duration. In such a situation,
the declaration will continue to have effect (despite having expired) for the
purposes of ascertaining whether the determination remains in force,
ascertaining whether a party to the determination has any obligations under
section 152AR (ie in relation to the standard access obligations) to any other
party to the determination while it remains in force and the exercising of the
ACCC’s power to vary the determination under section 152DT.
The
proposed amendment is designed to ensure that determinations that do not have an
indefinite duration (for example, a determination might specify an expiry date
or the duration of the determination may be connected to the duration of a
commercial agreement) will continue to have effect until such time as the
determination ceases to be in force. However, a party to the determination will
not be able to notify an access dispute in relation to the declared service
(proposed subsection 152DNC(3)). Determinations that are of indefinite duration
will cease to be of effect when the declaration relating to the declared service
concerned expires.
Item 15 – Transitional – section 152ALA
of the Trade Practices Act 1974
Item 15 is a transitional
provision that will apply to a declaration under section 152AL of the TPA and
was in force immediately before the commencement of Item 15. Item 15 provides
that proposed section 152ALA will not apply to such a declaration until the ACCC
determines both that an expiry date for the declaration and that section 152ALA
will apply to the declaration as if the expiry date had been specified in the
declaration. This determination must be published in the Gazette and the expiry
date determined by the ACCC must occur within the 5-year period beginning on the
commencement of Item 15. The ACCC will be required to take all reasonable steps
to ensure that each declaration to which the transitional provision applies is
covered by a determination within 6 months of the commencement of Item 15. The
purpose of this transitional provision is to allow the ACCC to stagger its
review of existing declarations rather than to consider all extensions at the
same time.
Part 4 – Revocation of declarations of minor
importance
Currently, the TPA provides that existing declarations
(made under section 152AL) cannot be revoked unless the ACCC has held a public
inquiry (section 152AO). However, the ACCC is allowed to make minor variations
to existing declarations without conducting a public inquiry (subsection
152AO(3)).
The PC Report noted that this has resulted in some
declarations outliving their useful lives. For example, although the analogue
mobile service has been discontinued, the ACCC cannot revoke the declaration of
those services without a public inquiry. This procedural requirement uses
resources that must be diverted from other tasks. As a result, the declared
AMPS services have remained declared despite there being no AMPS service in
operation. The PC Report recommended that the ACCC should be able to revoke a
declaration without a full public inquiry where the ACCC is satisfied that the
particular telecommunications service is a minor one.
Part 4 of Schedule
2 to the Bill contains amendments to implement the PC Report recommendation.
Item 16 – After subsection 152AO(1)
Section 152AO
contains provisions about the revocation and variation of declarations made by
the ACCC under section 152AL. Subsection 33(3) of the Acts Interpretation
Act 1901 applies to the power conferred on the ACCC under section 152AL but
with the changes provided in section 152AO. These changes are that the ACCC
cannot vary or revoke a declaration unless it has held a public inquiry about
the proposal to revoke or vary the declaration. This rule does not apply to a
variation that is minor in nature.
Item 16 inserts a new proposed subsection
after subsection 152AO(1). Proposed subsection 152AO(1A) will allow the ACCC to
revoke a declaration without holding a public inquiry under Part 25 of the
Telecommunications Act if, in the ACCC’s opinion, the particular service
to which the declaration relates is minor in nature. The purpose of this
amendment is to allow the ACCC to revoke a declaration without a full public
inquiry where the ACCC is satisfied that the particular telecommunications
service is of minor importance.
Part 5 – Service
provider’s reasonably anticipated requirements
Carriers and
carriage service providers (access providers) who provide active declared
services are required to comply with standard access obligations (SAOs) in
relation to those services (section 152AR). If requested to do so by a service
provider, an access provider is required to:
• supply an active declared service to the
service provider (so the service provider can provide carriage and/or content
services);
• take all reasonable steps to ensure
that the technical and operational quality of the service supplied to the
service provider is equivalent to that to which the access provider provides to
itself; and
• take all reasonable steps to ensure
that the service provider receives, in relation to the service, fault detection,
handling and rectification of a technical or operational quality and timing that
the access provider provides to itself.
However, the access provider is not required to comply with an obligation to the extent that the obligation would prevent a service provider who already has access to the declared service, or the access provider, from obtaining a sufficient amount of the service to be able to meet its reasonably anticipated requirements, at the time that the request is made by a service provider (paragraphs 152AR(4)(a) and (b)). These limitations on standard access obligations are relevant to the scope of the determinations made by the ACCC when arbitrating an access dispute. Section 152CQ provides that the ACCC must not make a determination that would prevent a service provider who already has access to the declared service from obtaining a sufficient amount of the service to be able to meet its reasonably anticipated requirements or the carrier or provider from obtaining a sufficient amount of the service to be able to meet the carrier or provider’s reasonably anticipated requirements, at the time when the dispute was notified (paragraphs 152CQ(1)(a) and (b)). Subsection 152AR(4) provides that reasonably anticipated requirements are to be measured at the time when the access request was made, whereas paragraphs 152CQ(1)(a) and (b) specify that the relevant time is when the dispute was notified.
The PC Report noted that this inconsistency has created legal uncertainty
as to the applicable date and provides an incentive for early notification of an
access dispute to avoid a situation in which the access provider might seek to
“manufacture” other uses for whatever spare capacity remains. The
PC Report recommended that setting the date at the time that the access request
was made would solve these problems.
Part 5 contains amendments to
provide that the relevant time for assessing “reasonably anticipated
requirements” under subsection 152CQ(1) is the time that a request for
access to a declared service is made.
Item 17 – Paragraph
152CQ(1)(a)
Section 152CQ provides that the ACCC must not make a determination that would
prevent a service provider who already has access to the declared service from
obtaining a sufficient amount of the service to be able to meet its reasonably
anticipated requirements or the carrier or provider from obtaining a sufficient
amount of the service to be able to meet the carrier or provider’s
reasonably anticipated requirements, measured at the time when the dispute was
notified (paragraphs 152CQ(1)(a) and (b)).
Item 17 amends paragraph
152CQ(1)(a) to provide that the relevant time that the service provider’s
reasonably anticipated requirements will be measured at the time when the access
seeker made a request in relation to the service under section 152AR. The
proposed amendment ensures that the time that a service provider’s
reasonably anticipated requirements are measured under paragraph 152AR(4)(a) and
paragraph 152CQ(1)(a) will both be the time that an access seeker (or service
provider as described in section 152AR) makes a request under section 152AR for
access to a declared service.
Item 18 – Paragraph 152CQ(1)(b)
Section 152CQ provides that the ACCC must not make a determination that would
prevent a service provider who already has access to the declared service from
obtaining a sufficient amount of the service to be able to meet its reasonably
anticipated requirements or the carrier or provider from obtaining a sufficient
amount of the service to be able to meet the carrier or provider’s
reasonably anticipated requirements, measured at the time when the dispute was
notified (paragraphs 152CQ(1)(a) and (b)).
Item 18 amends paragraph
152CQ(1)(b) to provide that the relevant time that the service provider’s
reasonably anticipated requirements will measured will be the time when the
access seeker made a request in relation to the service under section 152AR.
The proposed amendment provides that the time that a service provider’s
reasonably anticipated requirements are measured under paragraph 152AR(4)(a) and
paragraph 152CQ(1)(b) will both be the time that an access seeker (or service
provider as described in section 152AR) makes a request under section 152AR for
access to a declared service.
Item 19 – Transitional – section 152CQ of the Trade
Practices Act 1974
Item 19 is a transitional provision to make it
clear that the proposed amendments to section 152CQ (Items 17 and 18) do not
affect the validity of a determination on access made by the ACCC (under section
152CP) before the commencement of Item 19.
Part 6 – Costs of
extending or enhancing the capability of a facility etc.
Section
152CQ sets out restrictions on the ACCC’s ability to make determinations
on access in relation to the arbitration of an access dispute. Paragraph
152CQ(1)(f) prevents the ACCC from making a determination that that would have
the effect of requiring a party (other than the access seeker) to bear some or
all of the costs of extending or enhancing the capability of a facility or
maintaining extensions to or enhancements of the capability of the
facility.
The PC Report noted that one interpretation of the provision is
that in circumstances where an access provider is required to bear any facility
costs as a result of the ACCC’s determination, no matter how small, a
determination would be set aside. The PC Report further noted that this
interpretation may have some unintended impacts such as the first access seeker
bearing the costs of extending or enhancing the capability of a facility, which
would benefit subsequent access seekers, and the calculation of the cost could
be problematic, particularly where an access seeker only wants access for a
particular period but would be required to finance the full enhancement of the
facility. The PC Report recommended that the words “some or all of the
costs” in paragraph 152CQ(1)(f) be amended to refer to “an
unreasonable amount of the costs”.
The amendments in Part 6
implement this recommendation.
Item 20 – Paragraph
152CQ(1)(f)
Paragraph 152CQ(1)(f) prevents the ACCC from making a
determination that would have the effect of requiring a party (other than the
access seeker) to bear some or all of the costs of extending or enhancing the
capability of a facility or maintaining extensions to or enhancements of the
facility.
Item 20 amends paragraph 152CQ(1)(f) so that the ACCC will be prevented from making a determination that would have the effect of requiring a party (other than the access seeker) to bear an unreasonable amount of the costs of extending or enhancing the capability of a facility or maintaining extensions to or enhancements of the facility. This will mean that the blanket prohibition on the ACCC making a determination that would have the effect of requiring a party (other than the access seeker) to bear some or all of the costs of extending or enhancing the capability of a facility will become more flexible.
Item 21 – Transitional – section 152CQ of the Trade
Practices Act 1974
Item 21 is a transitional provision to make it
clear that the proposed amendment of section 152CQ in Item 20 does not affect
the validity of a determination on access made by the ACCC (under section 152CP)
before the commencement of Item 21.
Part 7 – Hindering the fulfilment of a standard access obligation
etc.
Subsection 152EF(1) prohibits certain persons from engaging in conduct for
the purpose of preventing or hindering access by a service provider to a
declared service if that access is in accordance with any of the standard access
obligations (SAOs) (subparagraph 152EF(1)(b)(i)) or that access is in accordance
with a determination (subparagraph 152EF(1)(b)(ii)). The subsection applies to:
• a carrier or carriage service provider who
supplies a declared service;
• a service provider
to whom a declared service is being supplied by a carrier or carriage service
provider; or
• a body corporate that is related
to the carrier, carriage service provider or service provider.
Subsection
152AY(2) specifies that a carrier or carriage service provider must comply with
the SAOs if there is a commercial relationship agreed by the parties, an
undertaking or a determination by the ACCC. The PC Report appears to agree with
the view that subsection 152AY(2) implies that if an access seeker had no
commercial agreement with the access provider (through an undertaking or
otherwise) then the carrier would not be bound to comply with the SAOs until the
ACCC had made a determination. Consequently, the prohibition on hindering the
fulfilment of a SAO would be delayed and would preclude access until that time.
The PC Report recommended that paragraph 152EF(1)(b) be
repealed.
However, the obligation to comply with the SAOs clearly exists
independently of any ACCC determination. The SAOs may be enforced upon
application to the Federal Court (see section 152BB). In any event, simply
repealing paragraph 152EF(1)(b) as recommended would have no effect on this
issue which turns on the relationship between section 152AR and 152AY. That
provision is there because an ACCC determination is capable of imposing
obligations on an access provider in addition to those imposed by the SAOs.
Because of the apparent misunderstanding that has arisen, subsection 152EF(1)
has been redrafted to make its intended effect clearer.
Item 22 – Section 152AA
Section 152AA contains a
simplified outline of Part XIC of the TPA. The outline states that “a
carrier, carriage service provider or related body must not prevent or hinder
access to a declared service”.
Item 22 amends section 152AA so that
the outline will state that a carrier, carriage service provider or related body
must not prevent or hinder the fulfilment of a standard access obligation. The
proposed amendment is consequential to the proposed amendment contained in Item
24.
Item 23 – Division 10 of Part XIC (heading)
The
heading to Division 10 of Part XIC is “Hindering Access to Declared
Services”. Item 23 amends the heading so that it will be “Hindering
the fulfilment of a standard access obligation etc”. The proposed
amendment is consequential to the proposed amendment contained in Item 24.
Item 24 – Subsection 152EF(1)
Subsection 152EF(1) prohibits certain persons from engaging in conduct for
the purpose of preventing or hindering access by a service provider to a
declared service if that access is in accordance with any of the standard access
obligations (subparagraph 152EF(1)(b)(i)) or that access is in accordance with a
determination (subparagraph 152EF(1)(b)(ii)). The subsection applies to:
• a carrier or carriage service provider who
supplies a declared service;
• a service provider
to whom a declared service is being supplied by a carrier or carriage service
provider; or
• a body corporate that is related
to the carrier, carriage service provider or service provider.
Item 24
repeals subsection 152EF(1) and replaces it with new proposed subsection
152EF(1). As stated above, this amendment does not effect any substantive
change but is merely intended to make clear the scope of the provision. The
proposed amendment will prohibit a person from engaging in conduct for the
purpose of preventing or hindering the fulfilment of a standard access
obligation or an obligation imposed by a determination made by the ACCC under
Division 8. The prohibition will apply to a carrier or carriage service
provider who supplies a declared service, a service provider to whom a declared
service is being supplied by a carrier, carriage service provider or a body
corporate that is related to a carrier, carriage service provider or a service
provider.
The proposed amendment also makes some consequential changes to
the headings to sections 152EF and 152EG.
Part 8 – Backdating of final determinations
Section
152DNA allows the ACCC to backdate any or all of the provisions of a final
determination, that is, any or all of the provisions in a final determination
may be expressed to have taken effect on a specified date that is earlier than
the date on which the determination took effect.
The power is intended to
act as an incentive for parties to reach commercial settlement of a dispute.
Backdating can account for any difference between the terms and conditions of
access, including price, between the final determination and those which have
prevailed in the post-dispute notification period.
The ACCC is not
subject to guidelines in the exercise of this power, although the backdating of
some or all of the provisions of a final determination can have a significant
financial impact on the outcome of an arbitration of an access dispute. The
ACCC is also not subject to any requirements to incorporate interest payments to
compensate parties for losses incurred as a result of over-payment.
By
amending the TPA to require the ACCC to publish guidelines on the use of the
backdating power, including to clarify its powers to require a party to a
determination to pay interest, industry will have greater certainty in the
power’s application and a greater capacity to settle disputes
commercially. It is proposed that the guidelines will also include a method
that the ACCC will use for calculating interest under the express power provided
by the proposed amendments. The proposed amendments are in accordance with PC
Report recommendation 10.17.
Part 8 contains amendments to require the
ACCC to publish guidelines regarding the exercise of its powers under section
152DNA and to clarify that the ACCC has the power to require a party to a
determination to pay interest on any sums to be paid under a determination. The
amendments will require the guidelines to be published under section 152DNA to
include a method that the ACCC will use in calculating interest to be paid in
respect of sums to be paid under a determination.
Item 25 – At
the end of section 152DNA
Item 25 inserts at the end of section
152DNA new proposed subsections 152DNA(6), (7), (8), (9) and
(10).
Proposed subsection 152DNA(6) will allow the ACCC to require a
party to an arbitration to pay interest to another party on the whole or part of
the money that the party is required to pay the other party under the
determination, where the money to be paid is specified in a backdated provision
of a determination. The ACCC will be able to require interest to be paid on a
sum to be paid under a provision of a determination for the whole or part of a
period beginning on the date that the parties began negotiations with a view to
agreeing on the terms and conditions for compliance with the standard access
obligations (paragraph 152AY(2)(a)) and ending on the date on which the
determination would have taken effect had no provision of the determination been
backdated (ie, 21 days after the determination is made) (subsection 152DN(1)).
Proposed subsection 152DNA(7) will require the ACCC, in exercising its
powers to backdate any or all of the provisions of a determination (subsection
(1)) or in requiring a party to pay interest in respect of a sum that it is
required to pay to another party under the determination (proposed subsection
(6)), to have regard to any guidelines in force (under proposed subsection (8))
and such other matters as the ACCC considers relevant.
Proposed
subsection 152DNA(8) will require the ACCC to formulate written guidelines for
the purposes of the proposed subsection (7). The ACCC will be required to take
all reasonable steps to ensure that those guidelines are made within 6 months of
the commencement of Item 25 and must make the guidelines available on the
Internet (proposed subsections (9) and (10)).
Part 9 –
Guidelines about the ACCC’s powers to regulate anti-competitive
conduct
Under Part XIB, the ACCC has powers to issue Part A and Part
B competition notices. A Part A competition notice may be issued where the ACCC
has reason to believe that a carrier or carriage service provider has engaged,
or is engaging in, a specified instance of anti-competitive conduct (section
151AKA). A Part A competition notice is not required to specify any particular
instance of anti-competitive conduct. The issue of a Part A competition notice
by the ACCC is a pre-condition to the ACCC, or a person who has suffered loss or
damage, instituting proceedings against the carrier or carriage service
provider.
A Part B competition notice may be issued where the ACCC has
reason to believe that a carrier or carriage service provider has contravened,
or is contravening, the competition rule and the notice must set out the
particulars of the contravention (section 151AL). A Part B competition notice
constitutes prima facie evidence of the matters specified in the notice and
therefore facilitates legal proceedings relating to the alleged contravention of
the competition rule.
The ACCC may institute a proceeding in the Federal
Court for the recovery, on the behalf of the Commonwealth, a pecuniary penalty
(section 151BY) where it has issued a Part A competition notice. The pecuniary
penalty may be imposed by the Court if the Court is satisfied that a carrier or
carriage service provider has contravened, or has attempted to contravene, the
competition rule (section 151BX). In addition, the carrier or carriage service
provider may be ordered to disclose information or publish advertisements
(section 151CB) and may be liable for damages to other persons who suffered loss
or damage due to the anti-competitive conduct (section 151CC). Other orders to
compensate a party or prevent or reduce loss or damage may also be made (section
151CE).
The ACCC has already issued guidelines in relation to the use of
its powers to issue a competition notice (as required under s.151AP). However,
the guidelines provide little practical analysis of circumstances where the ACCC
will rely on its anti-competitive conduct powers rather than others in Part XIB
or XIC. The PC Report recommended that the ACCC be required to develop and
publish, after public consultation, guidelines for deciding which regulatory
mechanism is most appropriate in particular cases. The creation of more
detailed guidelines would be a useful clarification for industry and would
facilitate a consistent approach from the ACCC with respect to the use of its
powers to issue a competition notice.
Part 9 contains amendments to
implement the PC Report’s recommendation. The proposed amendments require
the ACCC to develop and publish guidelines on the use of its powers to regulate
anti-competitive conduct under Part XIB. The guidelines will not be binding on
the ACCC.
Item 26 – Subsection 151AP(3)
Section
151AP relates to guidelines. Section 151AP requires the ACCC to formulate
guidelines about the decision of whether to issue a competition notice. The
section also requires the ACCC to have regard to the guidelines and any other
matters it considers relevant when deciding whether to issue a competition
notice. Subsection 151AP(3) required the ACCC to take all reasonable steps to
ensure that the guidelines were in place by 1 July 1997.
Item 26 repeals
subsection 151AP(3) and replaces it with proposed new subsection (3). The
proposed amendment will require the guidelines to address the appropriateness of
the ACCC issuing a competition notice as opposed to the ACCC taking other action
under the TPA. The ACCC will be required to take all reasonable steps to ensure
that the guidelines address this matter within 12 months of the commencement of
Item 26. The purpose of the proposed amendment is to implement the PC Report
recommendation that the ACCC be required to develop and publish guidelines in
relation to the use of its powers under Parts XIB and XIC of the
TPA.
Part 10 – Telecommunications access
codes
The Telecommunications Access Forum (TAF) is an industry body declared by the
ACCC to be the TAF under section 152AI. TAF membership is open to all carriers
and carriage service providers and the TAF is capable of generating
recommendations relating to the declaration of services under section 152AL and
developing access codes. It had been envisaged that there would be fewer
regulatory hurdles for implementing a TAF access code or a declaration
recommended by the TAF. However, the TAF has not recommended any services for
declaration and the usefulness of the access code that it generated has been
questioned by some participants in the telecommunications industry. The PC
Report concluded that the TAF has a marginal role in practice (due to the
procedural requirements of unanimity in decision-making and the incompatibility
of the goals of members of the TAF) and has not been an effective
decision-making body to date. The PC Report therefore recommended that the TAF
be abolished.
The amendments contained in Part 10 repeal the provisions
in Part XIC relating to the TAF.
Item 27 – Section 152AC (definition of ACCC telecommunications
access code)
Section 152AC contains definitions of terms used in
Part XIC of the TPA. Section 152AC defines “ACCC telecommunications
access code” to mean an ACCC telecommunications access code under Division
4.
Item 27 repeals this definition. The proposed amendment is
consequential to the proposed repeal of provisions in Part XIC relating to the
TAF which will result in the ACCC being the body that may make a
telecommunications access code. As a result of the repeal of provisions in Part
XIC relating to the TAF, the term “approved TAF telecommunications access
code” will be repealed and the term “telecommunications access
code” will replace the term “ACCC telecommunications code”.
Item 28 – Section 152AC (definition of approved TAF
telecommunications access code)
Section 152AC contains
definitions of terms used in Part XIC of the TPA. Section 152AC defines
“approved TAF telecommunications access code” to mean the approved
TAF telecommunications access code under Division 4.
Item 28 repeals this definition. The proposed amendment is consequential to the proposed repeal of provisions in Part XIC relating to the TAF which will result in the ACCC being the body that may make a telecommunications access code. The term “approved TAF telecommunications access code” will therefore be redundant.
Item 29– Section 152AC (definition of draft TAF
telecommunications access code)
Section 152AC contains
definitions of terms used in Part XIC of the TPA. Section 152AC defines
“draft TAF telecommunications access code” to mean a draft TAF
telecommunications access code under Division 4.
Item 29 repeals this
definition. The proposed amendment is consequential to the proposed repeal of
provisions in Part XIC relating to the TAF which will result in the ACCC being
the body that may make a telecommunications access code. As a result of the
repeal of provisions in Part XIC relating to the TAF, the term “draft TAF
telecommunications access code” will be redundant.
Item 30
– section 152AC (definition of TAF)
Section 152AC
contains definitions of terms used in Part XIC of the TPA. Section 152AC
defines “TAF” to have the meaning given by section
152AI.
Item 30 repeals this definition. The proposed amendment is
consequential to the proposed repeal of provisions in Part XIC relating to the
TAF which will result in the ACCC being the body that may make a
telecommunications access code. As a result of the repeal of provisions in Part
XIC relating to the TAF, the term “TAF” will be redundant.
Item 31 – Section 152AC
Section 152AC contains
definitions of terms used in Part XIC of the TPA. Item 31 inserts a new
definition in section 152AC of the term “telecommunications access
code”. A telecommunications access code will be a code made under section
152BJ. Section 152BJ allows the ACCC to make an ACCC telecommunications access
code. As a result of the proposed repeal of provisions in Part XIC relating to
the TAF, there will no longer be a need to distinguish between an approved TAF
telecommunications access code and an ACCC telecommunications access code since
only the ACCC will be able to make a telecommunications access code. The
proposed amendment is consequential to the proposed repeal of provisions in Part
XIC relating to the TAF.
Item 32 – Section
152AI
Section 152AI allows the ACCC to declare that a specified body
(the membership of which is open to all carriers and carriage service providers)
is to be the Telecommunications Access Forum for the purposes of Part XIC. Item
32 repeals section 152AI. The purpose of the proposed amendment is to implement
the PC Report’s recommendation by repealing the provisions in Part XIC
relating to the TAF.
Item 33 – Subsection
152AL(2)
Subsection 152AL(2) provides for the ACCC to declare an
eligible service to be a declared service upon the recommendation of the TAF.
Item 33 repeals subsection 152AL(2). The proposed amendment is consequential to
the proposed repeal of provisions in Part XIC relating to the
TAF.
Item 34 – Subsection 152AM(4)
Section 152AM
relates to inquiries about proposals to declare services. Subsection 152AM(4)
provides that the ACCC must give the ACA and the TAF a copy of the report about
an inquiry prepared in accordance with section 505 of the Telecommunications
Act.
Item 34 amends subsection 152AM(4) to omit reference to the TAF. The
proposed amendment is consequential to the proposed repeal of provisions in Part
XIC relating to the TAF.
Item 35 – Subsection
152AO(2)
Subsection 152AO(2) provides that the ACCC must not revoke
or vary a declaration under subsection 152AL(2) (ie a declaration based on a
recommendation of the TAF that an eligible service be declared) unless the ACCC
has held a public inquiry under Part 25 of the Telecommunications Act about the
proposed revocation or variation. However, this rule does not apply to
variations that are minor in nature.
Item 35 repeals subsection 152AO(2).
The proposed amendment is consequential to the repeal of subsection 152AL(2)
(see Item 33) which in turn is consequential to the proposed repeal of
provisions in Part XIC relating to the TAF.
Item 36 – Section
152AP
Section 152AP applies to a public inquiry of a kind mentioned
in subsection 152AO(2). Subsection 152AO(2) provides that the ACCC must not
revoke or vary a declaration under subsection 152AL(2) (ie a declaration based
on a recommendation of the TAF that an eligible service be declared) unless the
ACCC has held a public inquiry under Part 25 of the Telecommunications Act about
the proposed revocation or variation. However, this rule does not apply to
variations that are minor in nature.
Item 36 repeals section 152AP. The
proposed amendment is consequential to the repeal of subsection 152AO(2) (see
Item 35). Both proposed amendments are consequential to the proposed repeal of
provisions in Part XIC relating to the TAF.
Item 37 – Paragraph
152AQ(2)(c)
Section 152AQ requires the ACCC to keep a Register of
declared services in relation to declarations under section 152AL. Subsection
152AQ(2) specifies what is to be included in the Register. Paragraph
152AQ(2)(a) provides that copies of reports in relation to inquiries mentioned
in paragraph 152AL(3)(a) or subsection 152AO(2) must be kept in the
Register.
Item 37 amends paragraph 152AQ(2)(a) to omit reference to
subsection 152AO(2). The proposed amendment is consequential to the proposed
repeal of subsection 152AO(2) in Item 35. The proposed amendment in Item 35 is
consequential to the proposed repeal of provisions in Part XIC relating to the
TAF.
Item 38 – Subdivision A of Division 4 of Part
XIC
Division 4 of Part XIC relates to the Telecommunications Access
Code. Subdivision A of Division 4 relates to the TAF telecommunications access
code. Subdivision A allows the TAF to give the ACCC a draft TAF
telecommunications access code that sets out model terms and conditions relating
to compliance with standard access obligations and that are capable of being
adopted in undertakings. The Subdivision allows the ACCC to approve a draft TAF
telecommunications access code and sets out the conditions to be met before the
ACCC can approve a draft TAF telecommunications access code.
Item 38
repeals Subdivision A. The proposed amendment is a consequential to the
proposed repeal of provisions in Part XIC relating to the TAF.
Item 39
– Subdivision B of Division 4 of Part XIC (heading)
The heading
to Subdivision B of Division 4 is “ACCC Telecommunications Access
Code”. Item 39 repeals this heading as a consequence of the proposed
repeal of Subdivision A of Division 4 (Item 38).
Item 40 –
Section 152BJ
Section 152BJ allows the ACCC to make an ACCC
telecommunications access code, where there is no approved TAF
telecommunications access code in force, or to revoke an approved TAF
telecommunications access code and make an ACCC telecommunications access code
where the ACCC is satisfied that, if the TAF were to give the ACCC a draft TAF
telecommunications access code in the same terms as the approved TAF
telecommunications access code, it would refuse to approve the draft
code.
Item 40 repeals section 152BJ and replaces it with new proposed
section 152BJ. Proposed section 152BJ provides that the ACCC may make, in
writing, a telecommunications access code. A telecommunications access code
will be a disallowable instrument for the purposes of section 46A of the Acts
Interpretation Act 1901. It is proposed that only one telecommunications
access code will be able to be in force at a particular time (proposed
subsection 152BJ(3)).
The ACCC will be able to revoke or vary a
telecommunications access code made under proposed section 152BJ (subsection
33(3) of the Acts Interpretation Act 1901).
The proposed
amendment is consequential to the proposed repeal of provisions in Part XIC
relating to the TAF. This will have the effect that there will no longer be a
concept of a TAF telecommunications access code.
Item 41 –
Subsection 152BK(1)
Section 152BK deals with the content of an ACCC
telecommunications access code. Subsection 152BK(1) provides that an ACCC
telecommunications access code must set out model terms and conditions relating
to compliance with the standard access obligations and that are capable of being
adopted by access undertakings.
Item 41 amends subsection 152BK(1) to
change the reference to an ACCC telecommunications access code to a
telecommunications access code. The proposed amendment is consequential to the
proposed repeal of provisions in Part XIC relating to the
TAF.
Item 42 – Subsection 152BK(3)
Section
152BK deals with the content of an ACCC telecommunications access code.
Subsection 152BK(1) provides that an ACCC telecommunications access code must
set out model terms and conditions relating to compliance with the standard
access obligations and that are capable of being adopted by access undertakings.
Subsection 152BK(2) provides an ACCC telecommunications access code may contain
different sets of model terms and conditions for different kinds of obligations
or the same kind of obligations in so far as it applies to different kinds
declared services.
Item 42 amends subsection 152BK(2) to change the
reference to an ACCC telecommunications access code to a telecommunications
access code. The proposed amendment is consequential to the proposed repeal of
provisions in Part XIC relating to the TAF.
Section 152BL provides that the ACCC must not make an ACCC
telecommunications access code unless the ACCC has published the code and
invited submissions on the code, and has considered any submissions on the
code.
Item 43 amends section 152BL to change the reference to an ACCC
telecommunications access code to a telecommunications access code. The
proposed amendment is consequential to the proposed repeal of provisions in Part
XIC relating to the TAF.
Item 44 – Section
152BM
Section 152BM requires the ACCC to consult the ACA before
making an ACCC telecommunications code.
Item 44 amends section 152BM to
change the reference to an ACCC telecommunications access code to a
telecommunications access code. The proposed amendment is consequential to the
proposed repeal of provisions in Part XIC relating to the TAF.
Item 45
– Section 152BN
Section 152BN requires the ACCC to give a copy
of an ACCC telecommunications access code to the ACA and the TAF.
Item 45
amends section 152BN to change the reference to an ACCC telecommunications
access code to a telecommunications access code. The proposed amendment is
consequential to the proposed repeal of provisions in Part XIC relating to the
TAF.
Item 46 – Section 152BN
Section 152BN requires
the ACCC to give a copy of an ACCC telecommunications access code to the ACA and
the TAF.
Item 46 amends section 152BN to remove reference to the TAF in
section 152BN. The proposed amendment is consequential to the proposed repeal
of provisions in Part XIC relating to the TAF.
Item 47 – Section 152BO
Section 152BO deals with the
effect of an ACCC telecommunications access code. Section 152BO provides that
if an ACCC telecommunications access code is made at a particular time, Part XIC
(apart from sections 152BD to 152BI) has effect as if it were an approved TAF
telecommunications access code that had been approved at that time.
Item
47 repeals section 152BO. The proposed amendment is consequential to the
proposed repeal of provisions in Part XIC relating to the TAF.
Item 48
– Subdivision C of Division 4 of Part XIC
Subdivision C of
Division 4 of Part XIC deals with the duration, variation and revocation of
telecommunications access codes (ie approved TAF telecommunications access
codes).
Item 48 repeals Subdivision C. The proposed amendment is
consequential to the proposed repeal of provisions in Part XIC relating to the
TAF, which will mean that TAF telecommunications codes will no longer be able to
be made.
Item 49 – Subdivision D of Division 4 of Part XIC
(heading)
The heading of Subdivision D of Division 4 of Part XIC is
“Register of Telecommunications Access Codes”.
Item 49
repeals the heading. The proposed amendment is consequential to the proposed
repeal of provisions relating to the TAF. As a result of the proposed repeal of
provisions in Part XIC relating to the TAF, Subdivisions A and C of Division 4
will be repealed.
Item 50 – Subsection
152BR(1)
Subsection 152BR(1) requires the ACCC to maintain a Register
that includes all approved TAF telecommunications access codes and all approved
variations of approved TAF telecommunications access codes.
Item 50
amends subsection 152BR(1) to change references to approved TAF
telecommunications access code to telecommunications access code. The proposed
amendment is consequential to the proposed repeal of provisions in Part XIC
relating to the TAF.
Item 51 – Paragraph
152BR(1)(b)
Paragraph 152BR(1)(b) requires the ACCC to maintain a
Register that all approved variations of approved TAF telecommunications access
codes.
Item 51 amends subsection 152BR(1) to change the reference to
“approved variations” to “variations”. The proposed
amendment is consequential to the proposed repeal of provisions in Part XIC
relating to the TAF.
Item 52 – Subsection
152BS(4)
Section 152BS defines an access undertaking for the purposes
of Part XIC. Subsection 152BS(4) provides that the terms and conditions
specified in an access undertaking may be specified by adopting a model set of
terms and conditions set out in an approved TAF telecommunications access
code.
Item 52 amends subsection 152BS(4) to change references to approved
TAF telecommunications access code to telecommunications access code. The
proposed amendment is consequential to the proposed repeal of provisions in Part
XIC relating to the TAF.
Item 53 – Paragraph
152BV(1)(b)
Section 152BV deals with acceptance of access
undertakings by the ACCC where model terms and conditions are not adopted in the
undertaking. Paragraph 152BV(1)(b) provides that section 152BV applies where an
undertaking does not adopt a set of model terms and conditions set out in the
approved TAF telecommunications access code.
Item 53 amends paragraph
152BV(1)(b) to change references to approved TAF telecommunications access code
to telecommunications access code. The proposed amendment is consequential to
the proposed repeal of provisions in Part XIC relating to the TAF.
Item 54 – Paragraph 152BW(1)(b)
Section 152BW deals with
acceptance of access undertakings by the ACCC where model terms and conditions
are adopted in the undertaking. Paragraph 152BW(1)(b) provides that section
152BW applies where an undertaking adopts a set of model terms and conditions
set out in the approved TAF telecommunications access code.
Item 54
amends paragraph 152BW(1)(b) to change references to approved TAF
telecommunications access code to telecommunications access code. The proposed
amendment is consequential to the proposed repeal of provisions in Part XIC
relating to the TAF.
Item 55 – Subparagraph
152BX(2)(b)(ii)
Section 152BX deals with the duration of an access
undertaking. Subparagraph 152BX(2)(b)(ii) provides that, where the ACCC accepts
the undertaking and the undertaking adopts a set of model terms and conditions
set out in the approved TAF telecommunications access code, the undertaking
continues in operation until the approved TAF telecommunications access code is
revoked or varied so as to omit the relevant set of model terms and
conditions.
Item 55 amends subparagraph 152BX(2)(b)(ii) to change
references to approved TAF telecommunications access code to telecommunications
access code. The proposed amendment is consequential to the proposed repeal of
provisions in Part XIC relating to the TAF.
Item 56 – Subsection
152CH(1) (note 1)
Section 152CH deals with Ministerial pricing
determinations. Subsection 152CH(1) allows the Minister to make a written
determination setting out principles dealing with price-related terms and
conditions relating to standard access obligations. These determinations are
known as Ministerial pricing determinations. Note 1 to subsection 152CH(1)
draws attention to section 152BF which provides that the ACCC must not approve a
TAF telecommunications access code dealing with a price or method of
ascertaining a price unless the code is consistent with any Ministerial pricing
determination.
Item 56 repeals this note. The proposed amendment is
consequential to the proposed repeal of section 152BF (Item 38).
Item
57 – Subsection 152CH(1) (note 2)
Section 152CH deals with
Ministerial pricing determinations. Subsection 152CH(1) allows the Minister to
make a written determination setting out principles dealing with price-related
terms and conditions relating to standard access obligations. These
determinations are known as Ministerial pricing determinations. Note 2 to
subsection 152CH draws attention to subsection 152BK(3) which provides that the
ACCC must not make an ACCC telecommunications access code unless the code is
consistent with any Ministerial pricing determination.
Item 57 amends
this note to change the reference to an ACCC telecommunications access code to a
telecommunications access code. The proposed amendment is consequential to the
proposed repeal of provisions in Part XIC relating to the TAF.
Item 58
– Subsection 152CH(1) (note 5)
Section 152CH deals with
Ministerial pricing determinations. Subsection 152CH(1) allows the Minister to
make a written determination setting out principles dealing with price-related
terms and conditions relating to standard access obligations. These
determinations are known as Ministerial pricing determinations. Note 5 to
subsection 152CH(1) draws attention to subsection 152CI(2) which provides that a
provision of the approved TAF telecommunications access code has no effect to
the extent that the provision is inconsistent with any Ministerial pricing
determination.
Item 58 amends this note to change references to approved
TAF telecommunications access code to telecommunications access code. The
proposed amendment is consequential to the proposed repeal of provisions in Part
XIC relating to the TAF.
Item 59 – Subsection
152CI(2)
Section 152CI deals with undertakings and codes that are
inconsistent with Ministerial pricing determinations. Subsection 152CI(2)
provides that a provision of the approved TAF telecommunications access code has
no effect to the extent that the provision is inconsistent with any Ministerial
pricing determination.
Item 59 amends subsection 152CI(2) to change
reference to approved TAF telecommunications access code to telecommunications
access code. The proposed amendment is consequential to the proposed repeal of
provisions in Part XIC relating to the TAF (and therefore approved TAF
telecommunications codes).
Part 11 – Exemptions from standard access obligations
If
a carrier or carriage service provider supplies declared services to itself or
other persons, the declared services are active declared services (paragraph
152AR(2)(b)). If a carrier or carriage service supplies an active declared
service to a service provider, the standard access obligations in section 152AR
apply to the supply of that active declared service unless the carrier or
carriage service provider is exempt from any or all of the standard access
obligations under section 152AS (which allows the ACCC to exempt members of a
specified class of carrier) or under section 152AT (which allows the ACCC to
exempt an individual carrier or carriage service provider). Exemptions may be
subject to such conditions or limitations as specified by the ACCC in its
exemption determination.
Currently, it is not possible for the ACCC to
exempt a specified class of carrier or an individual carrier or carriage service
provider in relation to a service that is not an active declared service (ie, a
declared service that is being supplied to itself or other people). This means
that potential investors in telecommunications services are unable to apply for
exemption from the standard access obligations until they supply an active
declared service. This provides a disincentive for investment as it means that
potential access providers cannot obtain regulatory certainty as to whether or
not their service would be declared. In particular, where “risky
investments” were subject to potential declaration, the investment may be
rendered uneconomic as a result of this uncertainty.
The amendments in
Part 11 of Schedule 2 will extend the current exemption mechanism under Part XIC
by allowing the ACCC to determine that a class of carriers and/or carriage
service providers, or a particular individual, are exempted from current and
possible future standard access obligations in relation to a particular proposed
service even if that service is not in existence at the time that the exemption
is sought.
The purpose of the proposed amendments is to provide certainty
for potential investors in telecommunications infrastructure and services in
relation to access to that infrastructure or service in the future by allowing
the ACCC to exempt a specified class of carrier or carriage service provider or
an individual carrier or carriage service provider from the standard access
obligations before the service becomes an active declared service.
These
anticipatory exemptions need to specify an expiry time but are not subject to a
maximum expiry time. Longstanding exemptions may be appropriate in
circumstances where a service is “ex-post” contestable, and normally
would not be declared, but an investor may wish to obtain a ruling to this
effect beforehand. Exemptions for a limited period could exempt the investment
from access requirements for a short period of time, just as in the case of
patents, and could provide an incentive to invest and innovate in otherwise
uncertain circumstances.
Item 60 – After section
152AS
Item 60 inserts a new proposed section after section 152AS.
Proposed section 152ASA allows anticipatory class exemptions from standard
access obligations to be made by the ACCC. The ACCC will be able to make a
written determination that, in the event that a specified service or a proposed
service becomes an active declared service (ie, the service is declared and is
being supplied), members of a specified class of carrier or carriage service
provider are exempt from any or all of the standard access obligations, to the
extent that those obligations relate to the active declared service. A
determination will be a disallowable instrument for the purposes of section 46A
of the Acts Interpretation Act 1901.
The terms “specified
service” and “proposed service” allows for exemptions to apply
to services not yet in existence or not yet being supplied. A determination
made by the ACCC under proposed section 151ASA may be unconditional or subject
to conditions specified in the order (proposed subsection 152ASA(2)). For
example, a determination may contain a limitation that the exemption applies to
a service that is supplied using a particular facility, or particular
infrastructure and/or in a certain geographical area. This also provides
flexibility for the ACCC to grant an exemption in relation to any combination of
standard access obligations.
Before making such a determination, the ACCC
will need to be satisfied that the exemption will be in the long-term interests
of end-users of carriage services or services supplied by means of carriage
services. Recognising the potential economy-wide benefits of some investments,
the ACCC will be required to have regard to any matters specified by the
Minister (in a written instrument for that purpose), as well as the matters
specified in subsection 152AB(2), in applying this requirement. The written
instrument will be a disallowable instrument for the purposes of section 46A of
the Acts Interpretation Act 1901. Subsection 152AB(2) specifies the
matters to be considered in determining whether a particular thing promotes the
long-term interests of end-users of carriage services or services supplied by
means of carriage services. Since it is intended that the matters in subsection
152AB(2) will not be the only matters to which the ACCC will have regard, the
proposed section excludes the operation of subsection 152AB(3) for the purposes
of the proposed section. Subsection 152AB(3) limits the ACCC’s
consideration of the promotion of long-term interests of end-users to the
matters in subsection 152AB(3).
The ACCC will be required to specify an
expiry time of the exemption, however, if a determination expires, the ACCC will
not be prevented from making a fresh determination in the same terms as the
expired determination, or a determination under section 152AS where the service
has become an active declared service.
The proposed section contains a
requirement for public consultation on a draft determination.
Item 61
– Subsection 152AT(10)
Under section 152AT, a carrier or
carriage service provider may apply to the ACCC for a written order exempting
the carrier or carriage service provider from any or all of the standard access
obligations under section 152AR. The ACCC must either make a written order or
refuse the application (subsection 152AT(3)). Subsection 152AT(10) provides that
if the ACCC makes a decision refusing an application for an exemption order, the
ACCC must give the applicant a written statement of reasons for the
refusal.
Item 61 repeals subsection 152AT(10) and replaces it with new
proposed subsection 1512AT(10) and several additional new subsections. The
effect of the proposed subsections will be to impose a 6-month time limit on the
ACCC’s consideration, and decision, on applications for exemption under
section 152AT.
The introduction of time limits is intended to encourage
timely decision-making in order to promote certainty for investors and the
development of further competition.
Proposed subsection 152AT(10)
requires the ACCC to make a decision on an application within 6 months after
receiving the application. The proposed subsection does this by deeming the
ACCC to have made an order in accordance with the terms of the application if
the ACCC has not made a decision at the end of the 6-month period.
The
effects of the absolute limit and any potential for the time limit to be subject
to regulatory gaming are mitigated by allowing the ACCC to “stop the
clock” in certain circumstances. In calculating the 6-month period, the
days in the period beginning on the date that an application is published under
subsection 152AT(9) and ending on the time limit specified by the ACCC when it
publishes the application are to be disregarded. Similarly, the days during
which a request by the ACCC for further information remains unfulfilled are to
be disregarded in calculating the 6-month period. The ACCC will be able to
withdraw a request for further information in whole in or in part (proposed
subsection 152AU(4) (see Item 64)). For example, if the ACCC makes a request
for further information (which would effectively “stop the clock” on
the 6-month time limit) and receives some of the information requested, if the
ACCC were satisfied that the remaining information could not be provided, did
not exist or was no longer required, the ACCC could withdraw that part of the
request. This in turn would mean that the “clock” would start again
on the 6-month time limit (subject to any other suspension by virtue of the
public consultation on an application).
The effects of the absolute time
limit are further mitigated by the ACCC being able to extend, or further extend,
the 6-month time period for a period of not more than 3 months by giving a
written notice to the applicant that includes a statement explaining why the
ACCC has been unable to make a decision within the 6-month period, or the
previously extended 6-month period. After giving such a notice to the
applicant, the ACCC must make a copy of the notice available on the
Internet.
Proposed subsection 152AT(14) requires the ACCC, where it refuses
to accept an application, to provide the applicant with a statement that sets
out the reasons for the refusal. This will ensure that the requirements under
section 152AT are consistent with the requirements under proposed section 152ATA
(anticipatory exemption orders) (see Item 62).
Item 62 – After
section 152AT
Item 62 inserts a new proposed section after section
152AT. Proposed section 152ATA will allow a person who is, or expects to be a
carrier or carriage service provider to apply to the ACCC to make an order
exempting the person from any or all of the standard access obligations in the
event that a specified service or a proposed service becomes an active declared
service.
The terms “specified service” and “proposed
service” allows for exemptions to apply to services not yet in existence
or not yet being supplied. An order made by the ACCC under proposed section
152ATA may be unconditional or subject to conditions or limitations specified in
the order (proposed subsection 152ATA(4)). For example, an order may contain a
limitation that the exemption applies to a service that is supplied using a
particular facility, or particular infrastructure and/or in a certain
geographical area. This also provides flexibility for the ACCC to grant an
exemption in relation to any combination of standard access obligations.
The ACCC will be required to make the exemption order or refuse the
application for exemption. Before making an order, the ACCC will need to be
satisfied that the exemption will be in the long-term interests of end-users of
carriage services or services supplied by means of carriage services.
Recognising the potential economy-wide benefits of some investments, the ACCC
will be required to have regard to any matters specified by the Minister (in a
written instrument for that purpose), as well as the matters specified in
subsection 152AB(2), in applying this requirement. The written instrument will
be a disallowable instrument for the purposes of section 46A of the Acts
Interpretation Act 1901. Subsection 152AB(2) specifies the matters to be
considered in determining whether a particular thing promotes the long-term
interests of end-users of carriage services or services supplied by means of
carriage services. Since it is intended that the matters in subsection 152AB(2)
will not be the only matters to which the ACCC will have regard, the proposed
section excludes the operation of subsection 152AB(3) for the purposes of the
proposed section. Subsection 152AB(3) limits the ACCC’s consideration of
the promotion of long-term interests of end-users to the matters in subsection
152AB(3).
The ACCC will be required to specify an expiry time of the
order, however, if an order expires, the ACCC will not be prevented from making
a fresh order in the same terms as the expired order, or an order under section
152AT where the service has become an active declared service.
The
proposed section contains a requirement for public consultation on an
application for exemption if, in the ACCC’s opinion, the making of an
order is likely to have a material effect on the interests of a person (proposed
subsection 152ATA(11)).
To encourage timely decision-making in order to
promote certainty for investors, proposed subsection 152ATA(12) requires the
ACCC to make a decision on an application within 6 months after receiving the
application. The proposed subsection does this by deeming the ACCC to have made
an order in accordance with the terms of the application if the ACCC has not
made a decision at the end of the 6-month period.
The effects of the
absolute time limit and any potential for the time limit to be subject to
regulatory gaming are mitigated by allowing the ACCC to “stop the
clock” in certain circumstances. In calculating the 6-month period, the
days in the period beginning on the date that an application is published under
proposed subsection 152ATA(11) and ending on the time limit specified by the
ACCC when it publishes the application are to be disregarded. Similarly, the
days during which a request by the ACCC for further information remains
unfulfilled are to be disregarded in calculating the 6-month period. The ACCC
will be able to withdraw a request for further information in whole in or in
part (proposed subsection 152AU(4) (see Item 64)). For example, if the ACCC
makes a request for further information (which would effectively “stop the
clock” on the 6-month time limit) and receives some of the information
requested, if the ACCC were satisfied that the remaining information could not
be provided, did not exist or was no longer required, the ACCC could withdraw
that part of the request. This in turn would mean that the “clock”
would start again on the 6-month time limit (subject to any other suspension by
virtue of the public consultation on an application).
To further mitigate
the effect of the time limit, the ACCC will be able to extend, or further
extend, the 6-month time period for a period of not more than 3 months by giving
a written notice to the applicant that includes a statement explaining why the
ACCC has been unable to make a decision within the 6-month period, or the
previously extended 6-month period. After giving such a notice to the
applicant, the ACCC must make a copy of the notice available on the
Internet.
If the ACCC refuses an application, a notice must be provided
to the applicant setting out the reasons for the refusal.
Item 63
– At the end of subsection 152AU(1)
Section 152AU applies to
applications for exemption from any or all of the standard access obligations by
an individual carrier or carriage service provider (subsection 152AU(1)) and
allows the ACCC to request the applicant to give it further information about
the application. Subsection 152AU(3) provides that the ACCC may refuse to
consider the application until the applicant gives the ACCC the
information.
Item 63 amends subsection 152AU(1) so that section 152AU
will apply to applications under section 152AT and applications under proposed
section 152ATA. The proposed amendment is consequential to the proposed
amendment in Item 62, which will allow the ACCC to make an order exempting a
carrier or carriage service provider from any or all of the standard access
obligations in the event that a specified service or proposed service becomes an
active declared service. Under proposed section 152ATA, the ACCC will have 6
months from the date of receiving an application, or from the date that the ACCC
receives further information pursuant to a request under section 152AU, in which
to make a decision regarding the application.
Item 64 – At the
end of section 152AU
Section 152AU allows the ACCC to request an
applicant for further information about an application under sections 152AT and
proposed section 152ATA (see Item 63). The ACCC may refuse to consider an
application until the requested information is given to the ACCC.
Item 64
inserts a new proposed subsection at the end of section 152AU. Proposed
subsection 152AU(4) will allow the ACCC to withdraw a request in whole or in
part. The proposed amendment is consequential to the proposed amendments in
Part 11 which will impose 6-month time limits on the making of a decision in
relation to applications for exemption orders and anticipatory exemption orders,
subject to provisions to “stop the clock” where the ACCC has
requested further information (see Items 61 and 62).
Item 65 –
Subsection 152AV(1)
Section 152AV provides that a person whose
interests are affected by a decision of the ACCC under section 152AT may apply
to the ACT for a review of the decision.
Item 65 amends subsection
152AV(1) by inserting a reference to proposed section 152ATA. The proposed
amendment will mean that a person whose interests are affected by a decision of
the ACCC under proposed subsection 152ATA(1) (ie a decision in relation to an
application for exemption in the event that a specified or proposed service
becomes an active declared service) will be able to seek review of the decision
by the ACT. The proposed amendment is consequential to the proposed amendment
in Item 62.
Item 66 – Section 152AW
Section 152AW
deals with the functions and powers of the ACT. Subsection 152AW(1) provides
that on a review of a decision of the ACCC under section 152AT, the ACT may make
a decision affirming, setting aside or varying a decision of the ACCC and, for
the purposes of the review, may perform all the functions and exercise all of
the powers of the ACCC.
Item 66 repeals section 152AW and inserts new
proposed section 152AW. The substantive amendments to section 152AW are to
limit the information and evidence that the ACT may consider on a review to the
information and evidence that was before the ACCC in making the original
decision and to specify a 6-month period in which the ACT is to make a decision
on review. If the ACT has not made a decision at the end of the 6-month period,
it will be deemed to have made a decision in accordance with the terms of the
application for review.
The opportunity has also been taken to clarify
the power of the ACT on review of a decision of the ACCC to refuse to do
something. Proposed section 152AW provides that in such circumstances, the ACT
has the power to set aside the decision of the ACCC and to make a decision in
substitution for the decision of the ACCC. Proposed subsection 152AW(1) has
been redrafted to clarify the type of decision that the ACT may make on review
according to the nature of the decision being reviewed (ie, whether it is
positive in nature or whether it is a refusal to do a certain thing). It has
therefore been necessary to include in proposed subsection 152AW(1) a decision
of the ACCC to vary (or to refuse to vary) or to revoke (or to refuse to revoke)
an exemption order made under section 152AT or proposed section 152ATA. The
ability of the ACCC to do this arises from the operation of subsection 33(3) of
the Acts Interpretation Act 1901. However, this provision requires the
ACCC to exercise the power to vary (or to refuse to vary) or revoke (or to
refuse to revoke) an exemption order in the same manner and subject to the same
conditions as apply to the exercise of the power to make an exemption order
under section 152AT or proposed section 152ATA. Therefore, the ACCC would need
to receive an application for the variation or revocation of an exemption order
made under section 152AT or proposed section 152ATA and would need comply with
the requirements of the relevant section in exercising the power conferred by
subsection 33(3) of the Acts Interpretation Act 1901.
Proposed
subsection 152AW(4) limits the information to which the ACT may have regard on
review to the information given, documents produced or evidence given to the
ACCC in connection with the decision to which the review relates and any other
information referred to in the ACCC’s reasons for making the decision.
This will mean that an applicant will not be able to put information, documents
or evidence to the ACT for consideration in reviewing the decision of the ACT
that was not first put before the ACCC, however, any information given to the
ACCC by a person in relation to the original decision by the ACCC will be before
the ACT on review.
Proposed subsection 152AW(5) will apply where a person
has applied for ACT review of a decision of the ACCC under section 152AT or
152ATA and where the ACT has not made a decision within 6 months after receiving
the application for review. If this occurs, the ACT will be taken to have made,
at the end of the 6-month period a decision in accordance with the terms of the
application for review. For example, where an application for review seeks to
have a decision of the ACCC refusing an application for an order under section
152AT or proposed section 152ATA set aside and an order made on certain terms,
if the ACT has not made a decision in relation to the application after 6 months
(subject to any extension of this time limit by the ACT), the ACT will be taken
to have made the decision sought in the application. The time limit will also
apply to decisions of the ACCC in relation to applications for the variation or
revocation of an exemption order which may be made as a result of the operation
of subsection 33(3) of the Acts Interpretation Act 1901 on section 152AT
and proposed section 152ATA.
The ACT will be able to extend, and further
extend, the 6-month period for a period of not more than 3 months by giving a
written notice to the applicant that includes a statement explaining why the ACT
has been unable to make a decision on the review within the 6-month period, or
the previously extended 6-month period. The ACT must make a copy of that notice
available on the Internet.
Item 67 – At the end of
section 152AX
Section 152AX provides that Division 1 of Part IX of
the TPA does not apply to a review of by the ACT of a decision made by the ACCC
under section 152AT. Division 1 of Part IX of the TPA deals with applications
for review by the ACT of determinations of the ACCC in relation to an
application for authorisation, or a minor variation of an authorisation, and the
functions and powers of the ACT on review.
Item 67 amends section 152AX
to insert a reference to proposed section 152ATA. The proposed amendment is
consequential to the proposed amendment of Item 62.
Item 68 –
After section 152AX
Item 68 inserts a new proposed section after section 152AX. Proposed section 152AXA provides that if the ACCC makes a decision under section 152AT or proposed section 152ATA and gives a person a written statement of reasons for the decision, the statement must specify the documents that the ACCC examined in course of making the decision. The purpose of this amendment is to ensure that documents that are examined by the relevant ACCC members who are performing the functions of the ACCC in considering an application are specified in any statement of reasons for the decision made in relation to the application, even if the ACCC members decided that they did not need to rely on a particular document in making their findings in relation to the application. The ACT will be able to consider documents specified in a statement of reasons on a review of a decision made by the ACCC under section 152AT or proposed section 152ATA.
Item 69 – Application – section 152AW of the Trade
Practices Act 1974
Item 69 provides that subsections 152AW(1),
(2) and (3) as amended by Part 11 will apply to applications for review that are
made before and after the commencement of Item 69 so long as the ACT had not
made a decision on review under subsection 152AW(1) before the commencement of
Item 69. Despite the repeal of subsection 152AW(4) by Part 11, that subsection
will continue to apply to applications made before the commencement of Item 69
as if it had not been repealed. Proposed subsections 152AW(1), (2) and (3)
clarify the ACT’s powers on review and are not substantive changes to
section 152AW. Therefore, it is appropriate that these proposed amendments
apply immediately upon commencement of Item 69, except in the case of
applications where a decision on review has been made.
Subsections
152AW(4) to (7) as amended by Part 11 will apply to applications for review made
after the commencement of Item 69. This means that the restriction on the
evidence that the ACT may consider and the 6-month time limit of the making of
review decisions by the ACT will only apply to applications for review made
after the commencement of Item 69. This will ensure that the substantive
changes to section 152AW will not have a retrospective effect on applications
for review made before the commencement of these proposed
amendments.
Part 12 – Access undertakings
Under
Division 5 of Part XIC of the TPA, carriers or carriage service providers who
are subject to standard access obligations (ie are supplying an active declared
service) may give the ACCC a written undertaking under which the carrier or
carriage service provider undertakes to comply with the terms and conditions
specified in the undertaking in relation to the applicable standard access
obligations.
The ACCC is required to accept or reject an undertaking
given to it. Subsection 152BV(2) prohibits the ACCC from accepting an
undertaking unless the ACCC:
• has published
the undertaking and invited people to make submissions to the ACCC on the
undertaking;
• is satisfied that the undertaking
is consistent with the standard access obligations that apply to the carrier or
carriage service provider;
• if the undertaking
deals with price or a method for ascertaining price, is satisfied that the
undertaking is consistent with any Ministerial pricing
determination;
• is satisfied that the terms and
conditions specified in the undertaking are reasonable;
and
• the expiry time of the undertaking occurs
within 3 years of the date that the undertaking comes into
operation.
Section 152AH sets out the matters to be taken into account
when determining whether terms and conditions in an undertaking are
reasonable.
Currently, potential investors in telecommunications services
or infrastructure are unable to gain the certainty of an undertaking until the
service that is proposed to be supplied becomes an active declared service.
When the service becomes an active declared service, the standard access
obligations apply to that service. This provides a disincentive for investment
as it means potential access providers cannot obtain regulatory certainty as to
the terms and conditions they would be required to provide access should the
service be declared. In particular, where “risky investments” are
subject to potential declaration, the investment may be rendered uneconomic as a
result of this uncertainty.
The amendments in Part 12 of Schedule 2 will
extend the current provisions relating to access undertakings under Part XIC by
allowing the ACCC to accept undertakings from existing and potential access
providers of all telecommunications services (including services provided by a
particular piece of telecommunications infrastructure), irrespective of whether
those services have or will be declared or are in existence. The proposed
amendments will create two types of undertakings: ordinary access undertakings
(which will be dealt with by Subdivision A of Division 5) and special access
undertakings (which will be dealt with by Subdivision B of Division 5). Special
access undertakings will cover proposed services and services which may exist to
some extent but are not yet declared.
The purpose of the proposed
amendments is to provide certainty for potential investors in telecommunications
infrastructure and services in relation to access to that infrastructure or
service in the future by allowing the ACCC to rule on whether the terms of a
proposed undertaking are acceptable prior to the investment being made.
Unlike ordinary access undertakings, special access undertakings do not have a maximum time limit. This is intended to provide further certainty for investors and an additional incentive for access providers to submit a special undertaking as special undertakings have the benefit of providing industry-wide access to the service on terms that are agreeable to the access provider and regulator. This would benefit access seekers to avoid costly arbitration proceedings by utilising the terms and conditions of access in the special undertaking. The combination of the binding term and the capacity for the investor and regulator to come to agreement on the terms and conditions of the special undertaking mean that this mechanism would allow the access provider and the regulator to enter into a type of regulatory compact.
Item 70 – Section 152AA
Section 152AA contains a
simplified outline to Part XIC of the TPA. The simplified outline states that
“an access undertaking may adopt the terms and conditions set out in a
telecommunications access code”. Item 70 amends section 152AA to make it
clear that a special access undertaking may not adopt the terms and conditions
set out in a telecommunications access code. The reason for this is that a code
would not be made for a non-declared service. The proposed amendment is
consequential to the proposed amendments in Item 95 that will allow special
access undertakings to be given to the ACCC.
Item 71 – Section
152AC (definition of access undertaking)
Section 152AC
contains definitions of terms used in Part XIC, including a definition of
“access undertaking”, which is defined to mean an undertaking under
Division 5. Item 71 amends this definition to provide that an access
undertaking means an “ordinary access undertaking” (which will be
defined in Item 72 to mean an undertaking under proposed Subdivision A of
Division 5) or a “special access undertaking” (which will be defined
in Item 73 to mean an undertaking under proposed Subdivision B of Division 5).
The proposed amendment is consequential to the proposed amendments in Item 95
which expand the current provisions under Division 5 relating to access
undertakings to allow undertakings to be accepted that relate to services that
are not active declared services.
Item 72 – Section
152AC
Section 152AC contains definitions of terms used in Part XIC.
Item 72 inserts a new proposed definition of “ordinary access
undertaking” into section 152AC. An ordinary access undertaking will mean
an undertaking under Subdivision A of Division 5. The concept of an ordinary
access undertaking is the same as the current concept of an access undertaking
(ie an access undertaking in relation to an active declared service). The
proposed amendment is consequential to the proposed creation of Subdivisions A
and B of Division 5 as a result of the extension of the current provisions
relating to access undertakings to allow access undertakings to be given in
relation to services that are not active declared
services.
Item 73 – Section 152AC
Section
152AC contains definitions of terms used in Part XIC. Item 73 inserts a new
proposed definition of “special access undertaking” into section
152AC. A special access undertaking will mean an access undertaking under
Subdivision B of Division 5 (ie an access undertaking in relation to a service
or a proposed service that is not an active declared service). The proposed
amendment is consequential to the proposed creation of Subdivisions A and B of
Division 5 as a result of the extension of the current provisions relating to
access undertakings to allow access undertakings to be given in relation to
services that are not active declared services.
Item 74 – At the
end of section 152AL
Section 152AL provides for the declaration of
eligible services as declared services by the ACCC. The standard access
obligations apply to a declared service (section 152AR). Item 74 inserts a new
proposed subsection at the end of section 152AL. Proposed subsection 152AL(7)
will effectively deem a service or proposed service that is the subject of a
special access undertaking to be a declared service vis-à-vis the person
that is supplying the service, where the person supplies the service or the
proposed service to itself or other persons. The purpose of this amendment is
to apply the standard access obligations and associated machinery of Part XIC to
the undertaking where the service has come into existence. Proposed subsection
152AL(8) makes it clear that proposed subsection 152AL(7) will not prevent the
ACCC from declaring (in the ordinary way under subsection 152AL(3)) a service
that is covered by a special access undertaking. The ACCC may need to declare
the service under subsection 152AL(3) even if the person who gave the special
access undertaking is the only supplier of the service where that person has
given notice of its intention to withdraw the special access undertaking (see
new section 152CBI, Item 95).
Item 75 – Paragraph
152BK(1)(b)
Section 152BK relates to the content of an ACCC
telecommunications access code. Paragraph 152BK(1)(b) provides that an ACCC
telecommunications access code must set out model terms and conditions that are
capable of being adopted by access undertakings.
Item 75 amends
paragraph 152BK(1)(b) to change the reference to “access
undertaking” to “ordinary access undertaking”. The proposed
amendment is consequential to the proposed extension of the current provisions
relating to access undertakings by distinguishing between ordinary access
undertakings (the same as access undertakings under the current provisions) and
special access undertakings (which may be given to the ACCC in relation to a
service or proposed service that is not an active declared service (ie a service
that is not declared or not being supplied)).
Item 76 – Before
section 152BS
Item 76 creates a new proposed Subdivision A of
Division 5 by inserting a heading before section 152BS. Proposed Subdivision A
will deal with ordinary access undertakings and will contain all of the current
provisions relating to access undertakings (which will be amended to refer to
ordinary access undertakings). The proposed amendment is consequential to the
proposed extension of the current provisions relating to access undertakings by
distinguishing between ordinary access undertakings (the same as access
undertakings under the current provisions) and special access undertakings
(which may be given to the ACCC in relation to a service or proposed service
that is not an active declared service (ie a service that is not declared or not
being supplied)).
Item 77 – Subsection
152BS(1)
Section 152BS specifies what an access undertaking is for
the purposes of Part XIC. Subsection 152BS(1) provides that, for the purposes
of Part XIC, an access undertaking is a written undertaking given by a carrier
or a carriage service provider to the ACCC in which the carrier or carriage
service provider undertakes to comply with the terms and conditions specified in
the undertaking in relation to the standard access obligations.
Item 77
amends subsection 152BS(1) to change the reference to “access
undertaking” to “ordinary access undertaking”. Item 77 also
amends the heading to section 152BS to refer to ordinary access undertakings.
The proposed amendment is consequential to the proposed extension of the current
provisions relating to access undertakings by distinguishing between ordinary
access undertakings (the same as access undertakings under the current
provisions) and special access undertakings (which may be given to the ACCC in
relation to a service or proposed service that is not an active declared service
(ie a service that is not declared or not being supplied)).
Item 78
– At the end of subsection 152BS(1)
Section 152BS defines what
an access undertaking is for the purposes of Part XIC. Item 78 inserts a note
at the end of 152BS(1) to highlight that an undertaking need not specify all
terms and conditions. This note makes it clear that an access undertaking
(which will be an ordinary access undertaking – see Item 77) given by a
carrier or carriage service provider to the ACCC under which the carrier or
carriage service provider undertakes to comply with the terms and conditions
specified in the undertaking in relation to the applicable standard access
obligations need not cover all possible matters. This proposition is implicit
from subparagraph 152AY(2)(b)(ii) which provides that if an undertaking does not
specify terms and conditions about a particular matter, terms and conditions on
that matter may be specified by the ACCC on arbitration of an access
dispute.
Item 79 – After subsection 152BS(6)
Section
152BS specifies what an access undertaking is for the purposes of Part XIC.
Subsection 152BS(6) provides that an access undertaking must be in the form
approved by the ACCC.
Item 79 inserts a new proposed subsection in
section 152BS. Proposed subsection 152BS(6A) will make it clear that an
undertaking may be made without limitations or may be subject to such
limitations as are specified in the undertaking. This makes it clear that an
undertaking may be given only in relation to, for example, a relevant service
supplied in a specified area or by means of a particular
facility.
Item 80 – After subsection 152BS(9)
Item 80
inserts a new proposed subsection after subsection 152BS(9). Proposed
subsection 152BS(9A) makes it clear that the expiration of an undertaking will
not prevent a carrier or carriage service provider from giving a fresh
undertaking in the same terms as the expired undertaking. However, once an
undertaking has expired, it will not be possible to seek an extension of the
term of the undertaking.
Item 81 – Subsection
152BT(1)
Section 152BT allows the ACCC to request a carrier or a
carriage service provider to give the ACCC further information about an
undertaking. Item 81 changes the reference to “access undertaking”
in subsection 152BT(1) to “ordinary access undertaking”. The
proposed amendment is consequential to the proposed extension of the current
provisions relating to access undertakings by distinguishing between ordinary
access undertakings (the same as access undertakings under the current
provisions) and special access undertakings (which may be given to the ACCC in
relation to a service or proposed service that is not an active declared service
(ie a service that is not declared or not being supplied).
Item 82
– At the end of section 152BT
Item 152BT allows the ACCC to
request an applicant for further information about an undertaking. The ACCC may
refuse to consider an undertaking until the requested information is given to
the ACCC.
Item 82 inserts a new proposed subsection at the end of section
152BT. Proposed subsection 152BT(4) will allow the ACCC to withdraw a request
in whole or in part. The proposed amendment is consistent with the proposed
amendments to section 152AU and 152BT (in Parts 11 and 12 of Schedule 2
respectively) and the proposed amendment in Item 95.
Item 83 –
Subsection 152BU(1)
Section 152BU provides that the ACCC may accept
or reject an access undertaking. Item 83 amends subsection 152BU(1) to change
the reference to “access undertaking” in subsection 152BU(1) to
“ordinary access undertaking”. The proposed amendment is
consequential to the proposed extension of the current provisions relating to
access undertakings by distinguishing between ordinary access undertakings (the
same as access undertakings under the current provisions) and special access
undertakings (which may be given to the ACCC in relation to a service or
proposed service that is not an active declared service (ie a service that is
not declared or not being supplied)).
Item 84 – Subsections
152BU(3) and (4)
Section 152BU provides that the ACCC may accept or
reject an access undertaking. Subsection 152BU(3) provides that if the ACCC
accepts the access undertaking, the ACCC must notify the applicant in writing.
Subsection 152BU(4) provides that if the ACCC rejects the access undertaking,
the ACCC must notify the applicant in writing and set out the reasons for the
rejection.
Item 84 amends subsections 152BU(3) and (4) to change the
references to “access undertaking” to “undertaking”.
The proposed amendment is consequential to the proposed amendment in Item 83.
Amended subsection 152BU(1) will refer to an ordinary access undertaking.
Thereafter, it is only necessary to refer to an undertaking.
Item 85
– At the end of section 152BU
Item 85 inserts several new
subsections at the end of section 152BU. The proposed subsections will impose a
6-month time limit in which the ACCC must make a decision in relation to an
undertaking. At the end of this period, if the ACCC has not made a decision, it
will be taken to have made a decision accepting the undertaking.
To
encourage timely decision making in order to promote certainty for investors,
proposed subsection 152BU(5) requires the ACCC to make a decision on an
undertaking within 6 months after receiving the undertaking. The proposed
subsection does this by deeming the ACCC to have accepted the undertaking if the
ACCC has not made a decision at the end of the 6-month period.
The
effects of the absolute time limit and any potential for the time limit to be
subject to regulatory gaming are mitigated by allowing the ACCC to “stop
the clock” in certain circumstances. In calculating the 6-month period,
the days in the period beginning on the date that an undertaking is published
under subparagraph 152BV(2)(a)(i) and ending on the time limit specified by the
ACCC when it publishes the undertaking are to be disregarded. Similarly, the
days during which a request by the ACCC for further information remains
unfulfilled are to be disregarded in calculating the 6-month period. The ACCC
will be able to withdraw a request for further information in whole in or in
part (proposed subsection 152BT(4) (see Item 82)). For example, if the ACCC
makes a request for further information (which would effectively “stop the
clock” on the 6-month time limit) and receives some of the information
requested, if the ACCC were satisfied that the remaining information could not
be provided, did not exist or was no longer required, the ACCC could withdraw
that part of the request. This in turn would mean that the “clock”
would start again on the 6-month time limit (subject to any other suspension by
virtue of the public consultation on an application).
To further mitigate
the effect of the time limit, the ACCC will be able to extend, or further
extend, the 6-month time period for a period of not more than 3 months by giving
a written notice to the applicant that includes a statement explaining why the
ACCC has been unable to make a decision within the 6-month period, or the
previously extended 6-month period. After giving such a notice to the
applicant, the ACCC must make a copy of the notice available on the
Internet.
Item 86 – Paragraph
152BV(1)(a)
Section 152BV deals with the acceptance of an access
undertaking where the undertaking does not adopt the model terms and conditions
in the approved TAF telecommunications access code. Paragraph 152BV(1)(a)
provides that section 152BV applies if an access undertaking is given to the
ACCC by a carrier or carriage service provider. Paragraph 152BV(1)(b) is
amended by Item 53 in Part 10 of Schedule 2 to the Bill to remove the reference
to the TAF (as a result of the proposed abolition of the TAF).
Item 86
amends paragraph 152BV(1)(a) to change the reference to “access
undertaking” in paragraph 152BV(1)(a) to “ordinary access
undertaking”. The proposed amendment is consequential to the proposed
extension of the current provisions relating to access undertakings by
distinguishing between ordinary access undertakings (the same as access
undertakings under the current provisions) and special access undertakings
(which may be given to the ACCC in relation to a service or proposed service
that is not an active declared service (ie a service that is not declared or not
being supplied)).
Item 87 – Paragraph
152BW(1)(a)
Section 152BW deals with the acceptance of an access
undertaking where the undertaking adopts the model terms and conditions in the
approved TAF telecommunications access code. Paragraph 152BW(1)(a) provides
that section 152BW applies if an access undertaking is given to the ACCC by a
carrier or carriage service provider. Paragraph 152BW(1)(b) is amended by Item
54 in Part 10 of Schedule 2 to the Bill to remove the reference to the TAF (as a
result of the proposed abolition of the TAF).
Item 87 amends paragraph
152BW(1)(a) to change the reference to “access undertaking” in
paragraph 152BW(1)(a) to “ordinary access undertaking”. The proposed
amendment is consequential to the proposed extension of the current provisions
relating to access undertakings by distinguishing between ordinary access
undertakings (the same as access undertakings under the current provisions) and
special access undertakings (which may be given to the ACCC in relation to a
service or proposed service that is not an active declared service (ie a service
that is not declared or not being supplied)).
Item 88 –
Subsection 152BX(1)
Section 152BX deals with the duration of access
undertakings. Subsection 152BX(1) provides that section 152BX applies if an
access undertaking is given to the ACCC.
Item 88 amends subsection
152BX(1) to change the reference to “access undertaking” in
subsection 152BX(1) to “ordinary access undertaking”. The proposed
amendment is consequential to the proposed extension of the current provisions
relating to access undertakings by distinguishing between ordinary access
undertakings (the same as access undertakings under the current provisions) and
special access undertakings (which may be given to the ACCC in relation to a
service or proposed service that is not an active declared service (ie a service
that is not declared or not being supplied)).
Item 89 – Subsection
152BY(1)
Section 152BY deals with the variation of access
undertakings. Subsection 152BY(1) provides that section 152BY applies if an
access undertaking given by a carrier or carriage service provider is in
operation.
Item 89 amends subsection 152BY(1) to change the reference to
“access undertaking” in subsection 152BY(1) to “ordinary
access undertaking”. The proposed amendment is consequential to the
proposed extension of the current provisions relating to access undertakings by
distinguishing between ordinary access undertakings (the same as access
undertakings under the current provisions) and special access undertakings
(which may be given to the ACCC in relation to a service or proposed service
that is not an active declared service (ie a service that is not declared or not
being supplied)).
Item 90 – At the end of section
152BY
Item 90 inserts several new proposed subsections at the end of
section 152BY. Section 152BY deals with the variation of access undertakings.
As a result of the proposed amendment in Item 89, section 152BY will deal with
the variation of ordinary access undertakings.
The proposed amendments in
Item 90 will impose a 6-month time limit in which the ACCC must make a decision
in relation to a variation of an ordinary access undertaking. At the end of
this period, if the ACCC has not made a decision, it will be taken to have made
a decision accepting the variation of the undertaking.
Proposed
subsection 152BY(7) requires the ACCC to make a decision on a variation of an
undertaking within 6 months after receiving the variation of the undertaking.
The proposed subsection does this by deeming the ACCC to have accepted the
variation of the undertaking if the ACCC has not made a decision at the end of
the 6-month period. The proposed amendment is designed to ensure that the
6-month limit that will apply to decisions of the ACCC about access undertakings
is consistently applied to variations of undertakings. As in the case of
decisions on access undertakings, the 6-month time limit will provide certainty
for investors.
The effects of the absolute time limit and any potential
for the time limit to be subject to regulatory gaming are mitigated by allowing
the ACCC to “stop the clock” in certain circumstances. In
calculating the 6-month period, the days in the period beginning on the date
that a variation of an undertaking is published under section 152BV and ending
on the time limit specified by the ACCC when it publishes the variation of the
undertaking are to be disregarded. Similarly, the days during which a request
by the ACCC for further information remains unfulfilled are to be disregarded in
calculating the 6-month period. The ACCC will be able to withdraw a request for
further information in whole in or in part (proposed subsection 152BZ(4) (see
Item 92)). For example, if the ACCC makes a request for further information
about the variation (which would effectively “stop the clock” on the
6-month time limit) and receives some of the information requested, if the ACCC
were satisfied that the remaining information could not be provided, did not
exist or was no longer required, the ACCC could withdraw that part of the
request. This in turn would mean that the “clock” would start again
on the 6-month time limit (subject to any other suspension by virtue of the
public consultation on a variation).
To further mitigate the effect of
the time limit, the ACCC will be able to extend, or further extend, the 6-month
time period for a period of not more than 3 months by giving a written notice to
the applicant that includes a statement explaining why the ACCC has been unable
to make a decision within the 6-month period, or the previously extended 6-month
period. After giving such a notice to the applicant, the ACCC must make a copy
of the notice available on the Internet.
Item 91 – Subsection
152BZ(1)
Section 152BZ allows the ACCC to request further information
from a carrier or carriage service provider in relation to a variation of an
access undertaking given to the ACCC. Subsection 152BZ(1) provides that section
152BZ applies if the carrier or carriage service provider gives the ACCC a
variation of an access undertaking.
Item 91 amends subsection 152BZ(1) to
change the reference to “access undertaking” in subsection 152BZ(1)
to “ordinary access undertaking”. The proposed amendment is
consequential to the proposed extension of the current provisions relating to
access undertakings by distinguishing between ordinary access undertakings (the
same as access undertakings under the current provisions) and special access
undertakings (which may be given to the ACCC in relation to a service or
proposed service that is not an active declared service (ie a service that is
not declared or not being supplied)).
Item 92 – At the end of
section 152BZ
Section 152BZ allows the ACCC to request an applicant
to provide further information about a variation of an access undertaking. The
ACCC may refuse to consider a variation until the requested information is given
to the ACCC.
Item 92 inserts a new proposed subsection at the end of
section 152BZ. Proposed subsection 152BZ(4) will allow the ACCC to withdraw a
request in whole or in part. The proposed amendment will ensure that section
152BZ is consistent with sections 152AU and 152BT (which will be similarly
amended in Parts 11 and 12 of Schedule 2 to the Bill respectively) and the
proposed amendment in Item 95.
Item 93 – Subsection
152CA(1)
Section 152CA allows a carrier or carriage service provider
to voluntarily withdraw an access undertaking by written notice to the ACCC.
Subsection 152AC(1) provides that section 152AC applies if an access undertaking
given by the carrier or carriage service provider is in operation.
Item
93 amends subsection 152CA(1) to change the reference to “access
undertaking” in subsection 152CA(1) to “ordinary access
undertaking”. The proposed amendment is consequential to the proposed
extension of the current provisions relating to access undertakings by
distinguishing between ordinary access undertakings (the same as access
undertakings under the current provisions) and special access undertakings
(which may be given to the ACCC in relation to a service or proposed service
that is not an active declared service (ie a service that is not declared or not
being supplied)).
Item 94 – Subsections 152CB(1) and
(2)
Section 152CB allows a carrier or carriage service provider to
give the ACCC an access undertaking that is expressed to replace a current
access undertaking (see subsection 152CB(2)). Subsection 152CB(1) provides
that section 152CB applies if an access undertaking given by a carrier or
carriage service provider is in operation.
Item 94 amends subsections
152CB(1) and (2) to change the references to “access undertaking” in
subsection 152BU(1) to “ordinary access undertaking”. The proposed
amendments are consequential to the proposed extension of the current provisions
relating to access undertakings by distinguishing between ordinary access
undertakings (the same as access undertakings under the current provisions) and
special access undertakings (which may be given to the ACCC in relation to a
service or proposed service that is not an active declared service (ie a service
that is not declared or not being supplied)).
Item 95 – After
section 152CB
Item 95 inserts a new proposed Subdivision after
section 152CB. Proposed Subdivision B of Division 4 will deal with special
access undertakings and contains provisions that define what special access
undertakings are (proposed section 152CBA), the process and criteria for
acceptance or rejection of a special access undertaking by the ACCC (proposed
sections 152CBB, 152CBC and 152CBD) and the extension, variation and withdrawal
of accepted special access undertakings (proposed sections 152CBE, 152CBF,
152CBG, 152CBH and 152CBI).
As noted above, currently, potential
investors in telecommunications services or infrastructure are unable to gain
the certainty of an undertaking until the service that is proposed to be
supplied becomes an active declared service. When the service becomes an active
declared service, the standard access obligations apply to that service. This
provides a disincentive for investment as it means potential access providers
cannot obtain regulatory certainty as to the terms and conditions under which
they would be required to provide access should the service be declared. In
particular, where “risky investments” are subject to potential
declaration, the investment may be rendered uneconomic as a result of this
uncertainty.
Special access undertakings allow the ACCC to accept
undertakings from potential access providers of proposed services and services
which may exist to some extent but are not yet declared. The purpose of the
proposed amendment is to encourage investment in telecommunications
infrastructure and services by providing certainty for potential investors in
relation to access obligations that will apply to the services provided by
proposed infrastructure or a particular service.
A special access
undertaking will be able to be given to the ACCC by a carrier or carriage
service provider, or a person who expects to be a carrier or carriage service
provider.
A special access undertaking may relate to a listed carriage
service or a service that facilitates the supply of a listed carriage service
that the person expects to supply so long as the service is not an active
declared service. A special access undertaking may be subject to limitations
specified in the undertaking or have no limitations. The term “service
that facilitates the supply of a listed carriage service” is intended to
provide considerable flexibility for the person who submits the special access
undertaking to describe the scope of the service to which the undertaking
applies. In particular, this will allow a service to be specified by reference
to a particular piece of telecommunications infrastructure over which the
particular or proposed service will be provided. For example, this could apply
to the supply of various telecommunications and telecommunications-related
services over a segment of digitised hybrid fibre coaxial cable described by
geographic location.
A service includes a proposed service (see
definition of service in proposed section 152CBJ). Undertakings relating to
active declared services will continue to be dealt with under subdivision A
(which will contain the current provisions relating to access undertakings) and
will be known as ordinary access undertakings.
A special access
undertaking will be required to state that in the event that the applicant
supplies the service (whether to itself or to other persons) the applicant
agrees to be bound by the standard access obligations to the extent that those
obligations would apply to the applicant if the service were a declared service
and undertakes to comply with the terms and conditions specified in the
undertaking in relation to the standard access obligations. However, a special
access undertaking will not need to specify all possible terms and conditions in
order for it to be a valid special access undertaking (see proposed note to
subsection 152CBA(3)). This is implicit from subparagraph 152AY(2)(b)(ii)
(which will apply both to ordinary and special access undertakings) because that
subparagraph provides that if an undertaking does not specify terms and
conditions about a particular matter, terms and conditions may be specified by
the ACCC on arbitration of an access dispute. This subparagraph continues to
apply to matters not covered by a special access undertaking.
An expiry
time must be specified in a special access undertaking. This expiry time may be
described by reference to when the service commences to be supplied or when the
undertaking comes into operation. An undertaking may also contain provisions
for the extension, or further extension of the duration of the undertaking,
subject to the approval by the ACCC of such extensions and further extensions.
For example, an undertaking may provide that it operates for five years
from the date the service is supplied, but will continue for a further five
years if the ACCC is satisfied that certain criteria specified in the
undertaking have been met.
Once a special access undertaking comes into
operation, it will operate as though the service supplied by the person who gave
the undertaking is a declared service, even if the service is not be the subject
of a declaration of general application. Special access undertakings will cover
services that are not declared and declared services that are not active and
will continue in operation until it expires or until it is withdrawn, even if
the service is subsequently declared under subsection 152AL(3).
When the
ACCC receives a special access undertaking, the ACCC may request the applicant
to provide further information about the undertaking (proposed section 152CBB).
The ACCC may refuse to consider the undertaking until the information is
provided and it may withdraw the request in whole or in part.
To
facilitate timely decision-making in order to promote certainty for investors,
the ACCC will be subject to a 6-month time limit for making a decision to refuse
or to accept a special access undertaking. Proposed subsection 152CBC(5)
requires the ACCC to make a decision on a special access undertaking within 6
months after receiving the undertaking. The proposed subsection does this by
deeming the ACCC to have accepted the special access undertaking if the ACCC has
not made a decision at the end of the 6-month period.
To mitigate the
effects of the time limit and any potential for the time limit to be abused, in
calculating the 6-month period, the days in the period beginning on the date
that an undertaking is published under proposed subparagraph 152CBD(2)(d)(i) and
ending on the time limit specified by the ACCC when it publishes the undertaking
are to be disregarded. Similarly, the days during which a request by the ACCC
for further information remains unfulfilled are to be disregarded in calculating
the 6-month period. The ACCC will be able to withdraw a request for further
information in whole in or in part (proposed subsection 152CBB(4)). For
example, if the ACCC makes a request for further information (which would
effectively “stop the clock” on the 6-month time limit) and receives
some of the information requested, if the ACCC were satisfied that the remaining
information could not be provided, did not exist or was no longer required, the
ACCC could withdraw that part of the request. This in turn would mean that the
“clock” would start again on the 6-month time limit (subject to any
other suspension by virtue of the public consultation on an
undertaking).
To further mitigate the effect of the time limit, the ACCC
will be able to extend, or further extend, the 6-month time period for a period
of not more than 3 months by giving a written notice to the applicant that
includes a statement explaining why the ACCC has been unable to make a decision
within the 6-month period, or the previously extended 6-month period. After
giving such a notice to the applicant, the ACCC must make a copy of the notice
available on the Internet.
The criteria for the ACCC’s decision to
refuse or accept a special access undertaking are contained in proposed section
152CBD. A special access undertaking cannot be accepted by the ACCC
unless:
• the ACCC is satisfied that the
terms and conditions in the undertaking would be consistent with the standard
access obligations;
• the ACCC is satisfied that
those terms and conditions are reasonable (section 152AH specifies matters that
are relevant to the determination of whether terms and conditions are
reasonable);
• the ACCC is satisfied that the
terms and conditions are consistent with any Ministerial pricing determination;
and
• the ACCC has published the undertaking,
invited submissions from the public on the undertaking and considered those
submissions.
In determining whether terms and conditions are reasonable,
the ACCC must have regard to the matters specified in section 152AH (which is
not an exhaustive list) and any matters specified in a written instrument made
by the Minister for this purpose. This instrument will be a disallowable
instrument for the purposes of section 46A of the Acts Interpretation Act
1901.
Where a special access undertaking is in operation and it
contains provisions that allow for the extension of the expiry time of the
undertaking with the approval of the ACCC, the person must make an application
to the ACCC in the last twelve months of the period of the undertaking for
approval of an extension. This provides that the decision to extend the expiry
time is considered commensurate with the market conditions at or near the time
of the expiry. The criteria for the ACCC’s decision to refuse to approve
or approve a special access undertaking would be those specified in the special
access undertaking. A person will be able to apply for approval of further
extensions of an access undertaking under proposed section 152CBE.
A
special access undertaking may be varied by giving the ACCC a variation of the
undertaking which the ACCC must reject or accept (proposed section 152CBG). The
same criteria for the ACCC’s decision to reject or accept an undertaking
will apply to the ACCC’s decision to reject or accept a variation of the
undertaking. However, if the variation is minor in nature, the ACCC will not be
required to publish the variation and seek submissions from the public on the
undertaking. Whether or not a variation is of a minor nature will be in the
ACCC’s discretion. The ACCC will be able to request further information
about a variation and may refuse to consider the variation until the information
is provided.
Proposed section 152CBG will impose a 6-month time limit
in which the ACCC must make a decision in relation to a variation of an ordinary
access undertaking. At the end of this period, if the ACCC has not made a
decision, it will be taken to have made a decision accepting the variation of
the undertaking. This will ensure that the 6-month limit that will apply to
decisions of the ACCC about special access undertakings will also apply to
variations of special access undertakings. As is the case in relation to
decisions in relation to special access undertakings, the ACCC will be able to
“stop the clock” in certain circumstances. In calculating the
6-month period, the days in the period beginning on the date that a variation of
an undertaking is published under proposed section 152CBD and ending on the time
limit specified by the ACCC when it publishes the variation of the undertaking
are to be disregarded. Similarly, the days during which a request by the ACCC
for further information about a variation (see proposed section 152CBH) remains
unfulfilled are to be disregarded in calculating the 6-month period. The ACCC
will be able to withdraw a request for further information in whole in or in
part (proposed subsection 152CBH(4)). For example, if the ACCC makes a request
for further information about the variation (which would effectively “stop
the clock” on the 6-month time limit) and receives some of the information
requested, if the ACCC were satisfied that the remaining information could not
be provided, did not exist or was no longer required, the ACCC could withdraw
that part of the request. This in turn would mean that the “clock”
would start again on the 6-month time limit (subject to any other suspension by
virtue of the public consultation on a variation).
The ACCC will be able
to extend, or further extend, the 6-month time period for a period of not more
than 3 months by giving a written notice to the applicant that includes a
statement explaining why the ACCC has been unable to make a decision within the
6-month period, or the previously extended 6-month period. After giving such a
notice to the applicant, the ACCC must make a copy of the notice available on
the Internet.
A person may voluntarily withdraw a special undertaking
that is in operation by giving written notice to the ACCC. The method for doing
so will depend on whether the service to which the undertaking relates is
declared at the time that the person gives the ACCC the notice. If the service
is declared (in the ordinary declaration way under subsection 152AL(3) as
opposed to a deemed declared that arises as a result of proposed subsection
152AL(7)) when the notice of withdrawal is given, only the notice of withdrawal
is required. However, at least twelve months’ notice of an intention to
withdraw the undertaking will need to be given where the service to which the
undertaking relates is not a declared service. This pre-condition is to give
the ACCC 12 months notice in order for it to determine if it should hold an
inquiry to declare the service in the ordinary way.
Item 96 –
Subsection 152CD(1)
Section 152CD relates to the enforcement of
access undertakings. Subsection 152CD(1) provides that section 152CD applies if
an access undertaking given by a carrier or carriage service provider is in
operation. Item 96 amends subsection 152CD(1) to change the reference to
“carrier or carriage service provider” to “person (the first
person)”. The proposed amendment is consequential to the proposed
amendments to create a new category of access undertakings called special access
undertakings. A person who expects to be a carrier or a carriage service
provider will be able to give the ACCC a special access undertaking. The
proposed amendment to subsection 152CD(1) therefore reflects the fact that a
person other than a carrier or carriage service provider may give an access
undertaking to the ACCC which may be enforced under section
152CD.
Item 97 – Paragraph 152CD(2)(b)
Section 152CD
relates to the enforcement of access undertakings. Subsection 152CD(1) provides
that section 152CD applies if an access undertaking given by a carrier or
carriage service provider is in operation. Subsection 152CD(2) provides that if
the ACCC, or any person whose interests are affected by the undertaking, thinks
that the carrier or carriage service provider has breached the access
undertaking, the ACCC or the person may apply to the Federal Court for an order
under subsection (3).
Item 97 amends paragraph 152CD(2)(b) to insert
“(the affected person)” after the reference to “person”.
The proposed amendment is consequential to the proposed amendments in Items 96
and 98 and is required to differentiate between the person who has given an
undertaking (the first person) and the person whose interests are affected by an
undertaking (the affected person).
Item 98 – Subsection
152CD(2)
Section 152CD relates to the enforcement of access
undertakings. Subsection 152CD(2) allows the ACCC or a person whose interests
are affected by the undertaking to apply to the Federal Court for an order under
subsection (3) if the ACCC, or the affected person, thinks that the carrier or
carriage service provider has breached the access undertaking. Under subsection
(3), the Federal Court, if it is satisfied that the carrier or carriage service
provider has breached the undertaking, can make orders directing the carrier or
carriage service provider to comply with the undertaking or to pay compensation
to another person who has suffered loss or damage as a result of the breach, or
any order the Court thinks appropriate.
Item 98 amends subsection
152CD(2) to change the references to “carrier or carriage service
provider” to “person (the first person)”. The proposed
amendment is consequential to the proposed amendments to create a new category
of access undertakings called special access undertakings. A person who expects
to be a carrier or a carriage service provider will be able to give the ACCC a
special access undertaking. The proposed amendment to subsection 152CD(2)
therefore reflects that a person other than a carrier or carriage service
provider may give an access undertaking to the ACCC which may be enforced under
section 152CD.
Item 99 – Subsection 152CD(2)
Section
152CD relates to the enforcement of access undertakings. Subsection 152CD(1)
provides that section 152CD applies if an access undertaking given by a carrier
or carriage service provider is in operation. Subsection 152CD(2) provides that
if the ACCC, or any person whose interests are affected by the undertaking,
thinks that the carrier or carriage service provider has breached the access
undertaking, the ACCC or the person may apply to the Federal Court for an order
under subsection (3).
Item 99 amends paragraph 152CD(2) to insert
“(the affected person)” after the reference to “person”.
The proposed amendment is consequential to the proposed amendments in Items 96
and 98 and is required to differentiate between the person who has given an
undertaking (the first person) and the person whose interests are affected by an
undertaking (the affected person).
Item 100 – Subsection
152CD(3)
Section 152CD relates to the enforcement of access
undertakings. Subsection 152CD(2) allows the ACCC to apply to the Federal Court
for an order under subsection (3) if the ACCC, or a person whose interests are
affected by the undertaking, thinks that the carrier or carriage service
provider has breached the access undertaking. Under subsection (3), the Federal
Court, if it is satisfied that the carrier or carriage service provider has
breached the undertaking, can make orders directing the carrier or carriage
service provider to comply with the undertaking or to pay compensation to
another person who has suffered loss or damage as a result of the breach, or any
order the Court thinks appropriate.
Item 100 amends subsection 152CD(3)
to change the references to “carrier or carriage service provider”
to “person (the first person)” throughout that subsection. The
proposed amendment is consequential to the proposed amendments to create a new
category of access undertakings called special access undertakings. A person
who expects to be a carrier or a carriage service provider will be able to give
the ACCC a special access undertaking. The proposed amendment to subsection
152CD(3) therefore reflects the fact that a person other than a carrier or
carriage service provider may give an access undertaking to the ACCC which may
be enforced under section 152CD.
Item 101 – Subsection
152CE(1)
Subsection 152CE(1) allows a person whose interests are
affected by a decision of the ACCC under subsection 152BU(2) (ie to accept or
reject an access undertaking) or under subsection 152BY(3) (ie to accept or
reject a variation to an access undertaking) to apply for review by the
ACT.
Item 101 amends subsection 152CE(1) to also allow a person whose
interests are affected by a decision of the ACCC under proposed subsections
152CBC(2) (to reject or accept a special access undertaking) and 152CBG(3) (to
accept or reject a variation of a special access undertaking) to apply for
review. The proposed amendment is consequential to the proposed amendment to
create the new category of access undertakings of special access undertakings
(see Item 95).
Item 102 – Section 152CF
Section 152CF
deals with the functions and powers of the ACT on review of certain decisions of
the ACCC in relation to access undertakings. Subsection 152CF(1) provides that
on a review of a decision of the ACCC under subsection 152BU(2) (ie to accept or
reject an access undertaking) or under subsection 152BY(3) (ie to accept or
reject a variation to an access undertaking), the ACT may make a decision
affirming, setting aside or varying the decision of the ACCC and, for the
purposes of the review, may perform all of the functions and exercise all of the
powers of the ACCC.
Item 102 repeals section 152CF and inserts new
proposed section 152CF. The substantive amendments to section 152CF are to
limit the information and evidence that the ACT may consider on a review to the
information and evidence that was before the ACCC in making the original
decision and to specify a 6-month period in which the ACT is to make a decision
on review. If the ACT has not made a decision at the end of the 6-month period,
it will be deemed to have made a decision in accordance with the terms of the
application for review.
Proposed subsection 152CF(4) limits the
information to which the ACT may have regard on review to the information given,
documents produced or evidence given to the ACCC in connection with the decision
to which the review relates and any other information referred to in the
ACCC’s reasons for making the decision. The proposed amendment ensures
that the time limits under proposed subsection 152CF(5) are not subject to abuse
by dumping of evidence on the ACT.
Proposed subsection 152CF(5) will
apply where a person has applied for ACT review of a decision of the ACCC under
subsections 152BU(2) or 152BY(3) (ie, decisions to accept or reject an ordinary
access undertaking or a variation of an ordinary access undertaking) or proposed
subsections 152CBC(2) or 152CBG(3) (ie, decisions to accept or reject a special
access undertaking or a variation of a special access undertaking) and where the
ACT has not made a decision within 6 months after receiving the application for
review. If this occurs, the ACT will be taken to have made, at the end of the
6-month period a particular decision depending on the nature of the decision
that is being reviewed. For example, where the application for review relates
to a decision of the ACCC to reject an access undertaking, if the ACT has not
made a decision in relation to the application after 6 months (subject to any
extension of this time limit by the ACT), the ACT will be taken to have made the
decision to set aside the ACCC’s decision and to accept the access
undertaking.
The ACT will be able to extend, and further extend, the
6-month period for a period of not more than 3 months by giving a written notice
to the applicant that includes a statement explaining why the ACT has been
unable to make a decision on the review within the 6-month period, or the
previously extended 6-month period. The ACT must make a copy of that notice
available on the Internet.
The opportunity has also been taken to clarify
the power of the ACT on review of a decision of the ACCC to refuse to do
something to set aside the ACCC’s decision and to make a decision in
substitution for the decision of the ACT. Proposed section 152CF provides that
in such circumstances, the ACT has the power to set aside the decision of the
ACCC and to make a decision in substitution for the decision of the ACCC.
Proposed subsection 152CF(1) has been redrafted to clarify the type of decision
that the ACT may make on review according to the nature of the decision being
reviewed (ie, whether it is positive in nature or whether it is a refusal to do
a certain thing). The reference to the ability of the ACT to vary a decision of
the ACCC has also been removed because it is inappropriate that a review body
have greater powers than an original decision-maker on review. In the case of
access undertakings, the ACCC is only able to accept or reject the undertaking.
The ACCC is not able to vary the access undertaking so it is therefore
appropriate that the ACT similarly not be able to vary an access undertaking on
review.
Item 103 – Section 152CG
Section 152CG
provides that Division 1 of Part IX of the TPA does not apply in relation to a
review by the ACT of a decision of the ACCC made under subsection 152BU(2) (to
accept or reject an access undertaking) or under subsection 152BY(3) (to accept
or reject a variation to an access undertaking).
Item 103 amends
section 152CG to extend the provision to review of decisions of the ACCC under
proposed subsections 152CBC(2) (to reject or accept a special access
undertaking) and 152CBG(3) (to accept or reject a variation of a special access
undertaking). The proposed amendment is consequential to the proposed amendment
to create a new category of access undertakings, special access
undertakings.
Item 104 – After section
152CG
Item 104 inserts two new proposed sections after section 152CG.
Proposed section 152CGA provides that if the ACCC makes a decision referred to in section 152CE (as amended – see Item 101) and gives a person a written statement of reasons for the decision, the statement must specify the documents that the ACCC examined in course of making the decision. The purpose of this amendment is to ensure that documents that are examined by the relevant ACCC members who are performing the functions of the ACCC in considering an ordinary access undertaking or a special access undertaking (or a variation of an undertaking) are specified in any statement of reasons for the decision made in relation to the undertaking, even if the ACCC members decided that they did not need to rely on a particular document in making their findings in relation to the undertaking. The ACT will be able to consider documents specified in a statement of reasons on a review of a decision made by the ACCC referred to in section 152CE.
Proposed section 152CGB provides that a determination made by the ACCC
under Division 8 (ie, a final determination in relation to an access dispute)
has no effect to the extent to which it is inconsistent with an access
undertaking that is in operation. This amendment makes it clear that an
undertaking prevails over a determination, from the date on which the
undertaking is in operation, to the extent that it deals with the same matters
(see also subsection 152CP(3), subparagraph 152AY(2)(b)(i) and subsection
152CQ(5)).
Item 105 – Subsection 152CH(1) (note
3)
Section 152CH allows the Minister to make a written determination
setting out principles dealing with price-related terms and conditions relating
to the standard access obligations. Note 3 to section 152CH draws attention to
subsection 152BV(2) which provides that the ACCC must not accept an access
undertaking dealing with price or a method of ascertaining price unless the
undertaking is consistent with any Ministerial pricing
determination.
Item 105 amends note 3 to subsection 153CH(1) to change
the reference to “access undertaking” in subsection 152BU(1) to
“ordinary access undertaking”. The proposed amendment is
consequential to the proposed extension of the current provisions relating to
access undertakings by distinguishing between ordinary access undertakings (the
same as access undertakings under the current provisions) and special access
undertakings (which may be given to the ACCC in relation to a service or
proposed service that is not an active declared service (ie a service that is
not declared or not being supplied)).
Item 106 – Subsection
152CH(1) (after note 3)
Item 106 inserts a new proposed note after
note 3 to subsection 152CH(1). Proposed note 3A draws attention to proposed
subsection 152CBD(2) which will provide that the ACCC must not accept a special
access undertaking unless the undertaking is consistent with any Ministerial
pricing determination.
The proposed amendment is consequential to the
proposed amendment in Item 95.
Item 107 – At the end of section
152CK
Section 152CK deals with relationships between Part XIC and
Part IIIA. Subsection 152CK(1) provides that notification of an access dispute
must not be given under section 44S if the dispute relates to one or more
aspects of a declared service (within the meaning of Part XIC). Subsection
152CK(2) provides that the ACCC must not accept an undertaking under section
44ZZA that relates to a declared service if the terms and conditions relate to
the provision of access to one or more services providers within the meaning of
Part XIC.
Proposed subsection 152AL(7) (see Item 74) will have the effect
of a service to which a special access undertaking relates being deemed to be
declared under section 152AL with respect to the supply of that service by the
person who gave the special access undertaking to the ACCC. Item 107 inserts a
new proposed subsection at the end of section 152CK. Proposed subsection
152CK(4) will ensure that a deemed declaration of a service under proposed
subsection 152AL(7) will not be considered a declared service for the purposes
of section 152CK and makes it clear that the reference to a declared service in
section 152CK are references to declarations made in the ordinary way under
section 152AL.
Item 108 – At the end of section 152CLA (after
the note)
Section 152CLA deals with the resolution of access disputes
and requires the ACCC, in exercising its powers in relation to resolution of
access disputes, to have regard to the desirability of access disputes being
resolved in a timely manner.
Item 108 adds several new proposed
subsections after section 152CLA. Proposed subsection 152CLA(2) allows the ACCC
to defer the consideration of an access dispute, in whole or in part, in order
to consider an access undertaking received by the ACCC that relates, in whole or
in part, to the matter that is the subject of the access dispute.
In
exercising its power to defer consideration of an access dispute, the ACCC must
have regard to:
• the fact that the
undertaking will, if accepted, apply generally to access seekers, whereas a
determination in relation to the access dispute will only apply to the parties
to the determination;
• the guidelines in force
in relation to the exercise of the power;
and
• any other matters that the ACCC considers
relevant.
The ACCC must take all reasonable steps to make within 6 months
of the commencement of Item 108.
The criteria in paragraph 152CLA(4)(a)
recognise that the ACCC should generally give priority to the consideration of
undertakings in preference to arbitrations. The remaining criteria in
subsection 152CLA(4) recognise that there may be circumstances where it is
appropriate for the ACCC to complete arbitration of an access
dispute.
Item 109 – Subsection 155AB(3) (definition of
protected Part XIB or XIC information)
Section 155AB relates
to protection of Part XIB or Part XIC information. Subsection 155AB(3) defines
“protected Part XIB or Part XIC information” as information that was
obtained by the ACCC under section 151AU, 152AU, 152BT, 152BZ, or 155 or rules
in force under section 151BU.
Item 109 amends the definition of
“protected Part XIB or Part XIC information” to include information
obtained by the ACCC under proposed section 152CBB or 152CBH. The proposed
amendment is consequential to the proposed amendment in Item 95.
Item
110 – Transitional – subsection 152BS(6A) of the Trade Practices
Act 1974
Item 110 is a transitional provision that ensures that
if the ACCC accepts an access undertaking before the commencement of proposed
subsection 152BS(6A) (which enables an undertaking to be with or without
limitations (see Item 79)), the undertaking will be as valid as it would have
been had the proposed subsection been in force. The proposed amendment will
ensure the validity of access undertakings accepted before the commencement of
irrespective of whether or not the access undertaking is subject to
limitations.
Item 111 – Application – section 152CF of the
Trade Practices Act 1974
Item 111 provides that subsections
152CF(1), (2) and (3) as amended by Part 11 will apply to applications for
review under section 152CE that are made both before and after the commencement
of Item 111 so long as the ACT had not made a decision on review under
subsection 152CF(1) before the commencement of Item 111. Despite the repeal of
subsection 152CF(4) by Part 12, that subsection will continue to apply to
applications made before the commencement of Item 111 as if it had not been
repealed. Proposed subsections 152CF(1), (2) and (3) clarify the ACT’s
powers on review and are not substantive changes to section 152CF. Therefore,
it is appropriate that these proposed amendments apply immediately upon
commencement of those amendments, except in the case of applications where a
decision on review has been made.
Subsections 152CF(4) to (7) as amended
by Part 12 will apply to applications for review made after the commencement of
Item 111. This means that the restriction on the evidence that the ACT may
consider and the 6-month time limit of the making of review decisions by the ACT
will only apply to applications for review made after the commencement of Item
111. This will ensure that the substantive changes to section 152CF will not
have a retrospective effect on applications for review made before the
commencement of these proposed amendments.
Part 13 –
Ordering and provisioning
Section 152AR sets out the standard access
obligations. Carriers and carriage service providers must comply with the
standard access obligations if the carrier or carriage service provider (known
as the access provider) supplies active declared services either to itself or a
third party, unless a class exemption under section 152AS or an individual
exemption under 152AT applies. Subsection 152AR(3) provides that an access
provider must, if requested to do so by a service
provider:
• supply an active declared service
to the service provider so that the service provider can provide carriage
services and/or content services;
• take all
reasonable steps to ensure that the technical and operational quality of the
active declared service supplied to the service provider is equivalent to that
which the access provider supplies to itself;
and
• take all reasonable steps to ensure that
the service provider receives, in relation to the active declared service
supplied to the service provider, fault detection, handling and rectification of
a technical and operational quality and timing that is equivalent to that which
the access provider supplies to itself.
Subsection 152AR(3) does not make
it clear as to whether it covers the ordering or provisioning of the active
declared service because these matters are not specifically addressed in that
subsection. However, there is a requirement to provide equivalence to the
extent that ordering and provisioning relates to technical and operational
quality of a service (paragraph 152AR(3)(b)).
The ordering and
provisioning of a service are essential components of receiving access to an
active declared service, in that a new service could not be provided to an
end-user without the order for that service being placed and acted upon and that
service being provisioned, or activated. To facilitate access to declared
services, Part 13 contains an amendment to make it clear that ordering and
provisioning are taken to be aspects of technical and operational quality in
paragraph 152AR(3)(b). This recognises that if ordering and provisioning are
not provided to an access seeker on equivalent terms to that to which the access
provider provides the service to itself, it can disadvantage a service provider
and thus reduce effective competition.
Item 112 – After
subsection 152AR(4)
Item 112 inserts three new proposed subsections
after subsection 152AR(3).
Proposed subsection 152AR(4A) provides that,
to avoid doubt, ordering and provisioning are taken to be aspects of technical
and operational quality referred to in paragraph 152AR(3)(b).
Proposed
subsection 152AR(4B) provides that the regulations may provide that, for the
purposes of subsection (4A), a specified act or thing is taken to be ordering.
Proposed subsection 152AR(4C) provides that the regulations may provide
that, for the purposes of subsection (4A), a specified act or thing is taken to
be provisioning.
The insertion of these subsections should not be taken
to alter the interpretation of the remaining subsections in 152AR.
Item 113 – Transitional – paragraph 152AR(3)(b) of the
Trade Practices Act 1974
Item 113 is a transitional provision
that provides that the proposed amendment in Item 112 is to be disregarded in
determining the meaning that paragraph 152AR(3)(b) had before the commencement
of Item 113.
Note however that the amendments in Item 113 are inserted
for the avoidance of doubt. This is not intended to imply that ordering and
provisioning were not part of the standard access obligations before this
amendment.
Part 14 – Review of competition
decisions
Part 14 of Schedule 2 to the Bill contains amendments to
ensure that the provisions in Part XIB that deal with the powers and functions
of the ACT on a review of a decision of the ACCC under Part XIB or under Part
XIC are consistent. In particular, section 151CJ is amended to clarify that
where the ACCC makes a decision to refuse to do something, the ACT is able to
set that decision aside and make a decision in substitution for that decision.
The proposed amendments in Part 14 are similar in nature to proposed subsections
152AW(1), (2) and (3) in Item 66 of Part 11 and proposed subsection 152CF(1),
(2) and (3) in Item 102 of Part 12 of Schedule 2 to the Bill. As noted in Parts
11 and 12 above, these are technical amendments and do not contain substantive
changes to the current provisions in the TPA.
Item 114 –
Subsections 151CJ(1) and (2)
Section 151CJ deals with the functions
and powers of the ACT on a review of the kind mentioned in section 151CI.
Section 151CI allows for a person to apply for review of the following decisions
of the ACCC:
• a decision under section 151BA
to refuse to make an exemption order;
• a
decision under section 151BG to revoke an exemption
order;
• a decision under section 151BQ to make
information obtained from a person available for inspection and
purchase;
• a decision under section 151BUA to
make a report obtained from a person (or an extract from that report) available
for inspection and purchase; or
• a decision
under section 151BUB or 151BUC to give a person a written direction to make a
report or extract available for inspection and purchase.
Subsection
151CJ(1) provides that on a review of a decision mentioned in section 151CI, the
ACT may make a decision affirming, setting aside or varying the decision of the
ACCC and for the purposes of the review, may perform all of the functions and
exercise all of the powers of the ACCC. Subsection 151CJ(2) provides that a
decision of the ACT affirming, setting aside or varying a decision of the ACCC
will be taken to be a decision of the ACCC for the purposes of the TPA (other
than for Division 9 of Part XIB, which is the Division in which section 151CJ is
contained).
Item 114 repeals subsections 151CJ(1) and (2) and replaces
them with new proposed subsections (1) and (2). The proposed amendments clarify
the power of the ACT (on review of a decision of the ACCC not to do something)
to set aside the decision and to make a decision in substitution for the
decision of the ACT.
Item 115 – Transitional – section
151CJ of the Trade Practices Act 1974
Item 115 is a
transitional provision that provides that the proposed amendments in Item 114
will apply to application for review under section 151CI made after the
commencement of Item 115 and to applications made before the commencement of
Item 115, so long as the ACT has not made a decision on review before the
commencement of the Item. Where the ACT has made a decision before the
commencement of the Item, the amendments will not apply.
Part 15
– Competition notices and advisory notices etc.
Under section
151AKA of Division 3 of Part XIB of the TPA, the ACCC may issue a Part A
competition notice that states that a specified carrier or carriage service
provider has engaged, or is engaging, in a specified instance of
anti-competitive conduct. This provides an important regulatory tool for the
ACCC to use where it deals with instances of anti-competitive conduct and
recognises that the telecommunications industry is an extremely complex,
horizontally and vertically integrated industry where competition is not fully
established in some telecommunications markets.
Division 3 does not specifically require the ACCC to provide a carrier or
carriage service provider to whom it is considering issuing a Part A competition
notice any warning of that action prior to the issue of the notice. While the
ACCC has made it its practice to enter into such consultation and the principles
of administrative law require the ACCC to accord procedural fairness to a
carrier or carriage service provider who will be affected by the issue a Part A
competition notice, this may not provide sufficient certainty for the affected
carrier or carriage service provider.
Part 15 contains amendments to
expressly provide an obligation on the ACCC to consult a potential recipient of
a Part A competition notice.
Part 15 also contains amendments to allow
the ACCC to issue an advisory notice under section 151AQB irrespective of
whether it has issued a Part A competition notice. An advisory notice is a
written notice that advises a carrier or carriage service provider of the action
it should take, or should consider taking, in order to ensure that it does not
engage, or continue to engage, in the kind of conduct specified in a Part A
competition notice. Currently, the ACCC may only issue an advisory notice under
section 151AQB at the same time that it issues a Part A competition notice, or
after it issues such a notice. The amendments contained in Part 15 will allow
the ACCC to issue an advisory notice prior to issuing a Part A competition and
will not require there to be a suspicion that a carrier or carriage service
provider is engaging, or is continuing to engage in, anti-competitive conduct.
This will mean that the ACCC will be able to issue an advisory notice as a
pre-emptive measure or respond to a submission put to it by a carrier or
carriage service provider as to how the carrier or carriage service provider may
alter its conduct in order to ensure that it does not engage in anti-competitive
conduct. However, the issue of an advisory notice will be in the ACCC’s
discretion and will not prevent the ACCC from issuing a Part A competition
notice without having issued an advisory notice.
Item 116 –
After subsection 151AKA(8) (before the note)
Under section 151AKA of
Division 3 of Part XIB of the TPA, the ACCC may issue a Part A competition
notice that states that a specified carrier or carriage service provider has
engaged, or is engaging, in a specified instance of anti-competitive conduct
(subsection 151AKA(1)) or at least one instance of anti-competitive conduct of a
kind described in the notice (subsection 151AKA(2)). There is no explicit
requirement under section 151AKA for the ACCC to provide a carrier or carriage
service provider to whom it is considering issuing a Part A competition notice
any warning of that action prior to the issue of the notice.
Item 116
inserts two new subsections in section 151AKA. Proposed subsection 151AKA(9)
explicitly provides that the ACCC must consult with a carrier or carriage
service provider before issuing a Part A competition notice to the carrier or
carriage service provider under subsection 151AKA(1). Proposed subsection
151AKA(10) explicitly provides that the ACCC must consult with a carrier or
carriage service provider before issuing a Part A competition notice to the
carrier or carriage service provider under subsection 151AKA(2). Under both
proposed subsections 151AKA(9) and (10), the ACCC will need to give the carrier
or carriage service provider a written notice that states that the ACCC proposes
to issue a Part A competition notice, describes, in summary form, the instance,
or the kind in the case of subsection (10), of anti-competitive conduct that is
proposed to be specified in the Part A competition notice and invites the
carrier or carriage service provider to make a submission to the ACCC on the
proposal within a specified time limit. The ACCC must consider any submission
before issuing a Part A competition notice. It is not intended that the notice
will need to contain full particulars of the instance or kind of
anti-competitive conduct that is proposed to be specified in the notice,
although this may be appropriate in some circumstances. The notice will be
required to contain the substance of the anti-competitive conduct that will be
specified in the notice. This reflects the intention that the proposed
amendment will make explicit the obligation to consult with the recipient of a
Part A competition notice that was previously reflected in ACCC practice and the
ACCC’s administrative law obligation to accord procedural fairness to the
recipient of a Part A competition notice. It is not intended that the proposed
amendment will increase or decrease those existing obligations.
Item
117 – Subsection 151AQB(1)
Section 151AQB allows the ACCC to
issue an advisory notice to a carrier or carriage service provider at the same
time that it issues a Part A competition notice to the carrier or carriage
service provider, or after it has issued the Part A competition notice
(subsection 151AQB(1)). An advisory notice is an instrument of an advisory
character in which the ACCC advises the carrier or carriage service provider of
the action it should take, or consider taking, in order to ensure that it does
not engage, or continue to engage, in the kind of conduct dealt with by the Part
A competition notice.
Item 117 repeals subsection 151AQB(1) and replaces
it with proposed subsections 151AQB(1) and (2). Proposed subsection 151AQB(1)
will allow the ACCC to give a carrier or carriage service provider an advisory
notice advising the carrier or carriage service provider of the action that it
should take, or should consider taking, in order to ensure that it does not
engage, or does not continue to engage, in anti-competitive conduct. The
proposed amendment will allow the ACCC to issue an advisory notice before, at
the same time, or after the issue of a Part A competition notice. The issue of
an advisory notice will be at the discretion of the ACCC and will not be a
pre-condition to the issue of a Part A competition notice under either
subsection 151AKA(1) or 151AKA(2) (proposed subsection 151AQB(2)). The issue of
an advisory notice will not require there to be a suspicion that a carrier or
carriage service provider is engaging, or is continuing to engage in,
anti-competitive conduct.
Item 118 – Subsection
151AQB(4)
Subsection 151AQB(4) provides that an advisory notice that
relates to a Part A competition notice ceases to be in force if the Part A
competition notice ceases to be in force.
Item 118 repeals subsection
151AQB(4). The proposed amendment is consequential to the proposed amendment in
Item 116 which will allow the ACCC to issue an advisory notice before it issues
a Part A competition notice. Consequently, it will no longer be appropriate for
the effect of an advisory notice to be linked to the effect of a Part A
competition notice.
Item 119 – At the end of section
151AQB
Item 119 inserts a new subsection at the end of section
151AQB. Section 151AQB allows the ACCC to issue advisory notices to carriers
and carriage service providers.
The proposed amendment in Item 117 will
allow the ACCC to issue an advisory notice prior, at the same time as, or after
the issue of a Part A competition notice. Currently, there is no explicit
provision establishing the process for the publication of advisory notices under
section 151QB. With the proposed amendment in Item 117 introducing a
pre-emptive character to advisory notices there is more likely to be
circumstances where the publication of information which the ACCC has provided
to a carrier or carriage service provider would be of public benefit. Proposed
subsection 151AQB allows the ACCC to publish an advisory notice if the ACCC is
satisfied that the publication of the advisory notice would result, or would be
likely to result in a benefit to the public and where that benefit would
outweigh any substantial prejudice to the commercial interests of a person that
would result, or would be likely to result, if the advisory notice were
published. The decision to publish an advisory notice will be in the
ACCC’s discretion and the ACCC may publish the notice in such a manner as
it thinks fit. Where, for example, a carrier or carriage service provider may
have sought an advisory notice in order to test a new service delivery model in
relation to a service which is not yet supplied, rather than actual
anti-competitive conduct, usually there would be strong grounds for keeping
commercial purposes confidential.
Item 120 – At the end
of section 151AU
Item 120 inserts a new proposed subsection at the
end of section 151AU. Section 151AU allows the ACCC to request further
information about an application for an exemption order. The ACCC may refuse to
consider the application until the information is received.
Proposed
subsection 151AU(3) will allow the ACCC to withdraw a request in whole or in
part. The proposed amendment is designed to ensure that section 151AU is
consistent with other similar provisions in Parts XIB and XIC of the TPA that
allow the ACCC to request further information and that will be amended to allow
the ACCC to withdraw a request for information in whole or in part.
Part 16 – Record-keeping rules and disclosure
directions
The Government has previously announced that it will encourage a more
transparent regulatory market by requiring accounting separation of
Telstra’s wholesale and retail operations. Accounting separation will
address competition concerns arising from the level of vertical integration of
Telstra’s wholesale and retail services and improve the provision of
costing and price information to access seekers and the
public.
Accounting separation will assist in identifying whether Telstra
is discriminating between itself and its competitors in relation to price or
non-price terms and conditions of supply, particularly in relation to the core
interconnection services over which Telstra has effective monopoly control. It
will also give Telstra both an incentive and an opportunity to demonstrate that
their price and non-price arrangements promote efficient competitive outcomes
and do not involve unfair discrimination or price squeeze behaviour.
The ACCC is already empowered to make record-keeping rules under Division 6
of Part XIB of the TPA with which specified carriers and carriage service
providers, or classes of carrier and carriage service providers, are required to
comply. These record-keeping rules already create the appropriate framework to
implement accounting separation. It is intended to introduce accounting
separation by building on the existing work that the ACCC has done with these
record-keeping rules, without needing to add to the ACCC’s existing
powers.
To provide for the implementation of accounting separation for
Telstra in a probative and deliberate manner, Part 16 provides that the Minister
may direct the ACCC in the exercise of its record-keeping rule functions under
sections 151BU, 151BUDA, 151BUDB or 151BUDC and the ACCC must comply with a
direction under these sections.
The Government’s proposed
accounting separation framework will ensure:
(a) Telstra prepares current
(replacement) cost accounts (as well as existing historic cost accounts) to
provide more transparency to the ACCC about Telstra’s ongoing and
sustainable wholesale and retail costs;
(b) Telstra publishes current cost
and historic cost key financial statements in respect of “core”
interconnect services but not underlying detailed financial and traffic data
which is regarded as commercially sensitive;
(c) the ACCC prepares and
publishes an “imputation” analysis (based on Telstra purchasing the
‘core’ interconnect services at the price that it charges external
access seekers) which will demonstrate whether there is any systemic price
squeeze behaviour; and
(d) Telstra publishes information comparing its
performance in supplying “core”services to itself and to external
access seekers in relation to key non-price terms and conditions. (These will
include faults / maintenance, ordering, provisioning, availability /
performance, billing and notifications).
The introduction of accounting
separation under this Part would:
• build on work already done by the ACCC and the industry with RAF,
rather than ‘reinvent the wheel’;
• recognise genuine
economies of scale and scope in the supply of retail services;
and
• avoid undue regulatory burdens on industry.
Item 121 – Section 151AA
Section 151AA contains a
simplified outline of Part XIB of the TPA. The simplified outline states that
the ACCC may make record-keeping rules that apply to carriers and carriage
service providers and that the ACCC may direct carriers and carriage service
providers (by a disclosure direction) to make certain reports available for
inspection and purchase.
Item 121 amends section 151AA to omit the
reference to “inspection and purchase”. The proposed amendment is
consequential to the proposed substantive amendments in Part 16 of Schedule 2 to
the Bill that will enable the Minister to give a direction to the ACCC in
relation to the exercise of its powers under the record-keeping rules and will
create a new category of report that may be required to be prepared under the
record-keeping rules. A “Ministerially-directed report” will be a
report prepared under a record-keeping rule where that rule was made as a result
of a Ministerial direction. The ACCC will be able to give disclosure directions
in relation to Ministerially-directed reports (and periodic reports) to make
reports, or extracts of reports, available in a manner specified in the
direction. Currently, the ACCC may give disclosure directions to a carrier or
carriage service provider in relation to reports prepared in accordance with the
record-keeping rules to make a report, or an extract of a report, available for
inspection or purchase. The purpose of the proposed amendment is to update the
simplified outline.
Item 122 – Section 151AB (definition of
disclosure direction)
Section 151AB defines terms referred to
in Part XIB and defines “disclosure direction” to mean a direction
under subsection 151BUB(2) or 151BUC(2).
Item 122 amends the definition
of “disclosure direction” to include a direction under proposed
subsections 151BUDB(2) or 151BUDC(2). The proposed amendment is consequential
to the proposed amendments in Item 124 which will insert proposed subsections
151BUDB(2) and 151BUDC(2) in Part XIB of the TPA.
Item 123 –
Section 151AB
Section 151AB defines terms referred to in Part XIB.
Item 123 inserts a definition of “Ministerially-directed report” and
defines this term to have the meaning given in proposed section 151BUAA (see
Item 124). The proposed amendment is consequential to the proposed amendment in
Items 124.
Item 124 – After section 151BU
Item 124
inserts two new sections after section 151BU.
Proposed section 151BUAA
allows the Minister to give a written direction to the ACCC in relation to the
exercise of its powers under section 151BU or proposed sections 151BUDA, 151BUDB
or 151BUDC. Under section 151BU, the ACCC may make record-keeping rules for
and in relation to requiring one or more specified carriers or carriage service
providers to keep and retain records. Such rules may also require the
preparation of reports consisting of information contained in the records kept
in accordance with the record-keeping rules. Subsection 151BU(4) provides that
the ACCC must not exercise its powers under section 151BU so as to require the
keeping or retention or records unless the records contain, or will contain,
information that is relevant
to:
• ascertaining whether the competition
rule has been, or is being, complied
with;
• ascertaining whether tariff filing
directions have been, or are being, complied
with;
• the operation of Part XIB (other than
Division 6);
• the operation of Part XIC (which
deals with access);
• the operation of Division 3
of Part 20 of the Telecommunications Act (which deals with Rules of Conduct
relating to dealings with international telecommunications operators);
or
• the operation of Part 9 of the
Telecommunications (Consumer Protection and Service Standards) Act 1999
(which deals with regulation of Telstra’s charges).
A direction
given to the ACCC by the Minister in relation to the exercise of its powers
under section 151BU and proposed sections 151BUDA, 151BUDB or 151BUDC will be a
disallowable instrument for the purposes of section 46A of the Acts
Interpretation Act 1901.
Such a direction will provide the means of
implementing the Government’s intention of introducing accounting
separation. The direction would most likely be in two parts. Firstly, it would
require the ACCC to exercise its power under section 151BU to require Telstra to
keep and retain records. Secondly, it would require the ACCC to exercise its
power under proposed sections 151BUDA, 151BUDB or 151BUDC to disclose
appropriate information contained in those records.
Where the ACCC
makes a record-keeping rule as a result of a Ministerial direction under
proposed subsection 151BUAA(1), and the rule requires the preparation of a
report, the rule must state that it is a rule made as a result of a Ministerial
direction and a report made under the rule will be known as a
Ministerially-directed report (proposed subsection 151BUAA(3)). The purpose of
proposed subsection 151BUAA(3) is to distinguish between rules, and reports
required to be prepared by those rules, made by the ACCC under existing
provisions in Division 6 of Part XIB, and rules, and reports required to be
prepared by those rules, made by the ACCC at the direction of the Minister (as a
result of the proposed amendments contained in this Item). This distinction is
important because different obligations attach to reports that are required to
be prepared by rules that are made by the ACCC at the direction of the
Minister.
Proposed section 151BUAB provides that a person may request the
ACCC to exercise its powers under sections 151BUA or 151BUB to disclose, or to
require the disclosure, of reports, or under section 151BUC to require the
disclosure of periodic reports. The ACCC must consider the request but it will
not need to consider requests that it considers to be frivolous, vexatious or
not made in good faith. The purpose of the proposed section is to make it
explicit that a decision by the ACCC to exercise its discretionary powers may be
prompted by a request from a person that it do so.
Item 125 –
After section 151BUD
Item 125 inserts several new sections after section 151BUD that deal with the
giving access to Ministerially-directed reports and Ministerially-directed
periodic reports to the public and the giving of limited access to specified
persons.
ACCC gives access to Ministerially-directed
reports
Proposed section 151BUDA applies to particular
Ministerially-directed reports given to the ACCC by a carrier or carriage
service provider in accordance with the record-keeping rules (subsection
151BUDA(1)) and deals with the disclosure of reports, or extracts from reports,
to the public or to specified persons as directed by the Minister. Proposed
section 151BUDA is not intended to limit the current provisions in section
151BUA that apply to the disclosure of reports (other than
Ministerially-directed reports) by the ACCC.
Where required to do so by
a Ministerial direction made under proposed section 151BUAA, the ACCC may make
copies of a Ministerially-directed report or copies of extracts from the report
(and other relevant material) available to the public. The ACCC may also, where
required to do so by a Ministerial direction under proposed section 151BUAA,
give a written direction to the carrier or carriage service provider requiring
it to take such action specified in the direction to inform the public (or such
persons as specified in the direction) that the report is, or extracts from it,
are available (paragraph 151BUDA(2)(b)). A person who intentionally or
recklessly contravenes a direction under paragraph 151BUDA(2)(b) is guilty of an
offence punishable on conviction by a fine not exceeding 20 penalty units
(proposed subsection 151BUDA(6)).
The ACCC can make copies of the
report, or extracts of the report, available to particular persons and on such
terms and conditions (if any) that the ACCC determines (proposed subsection
151BUDA(3)). The ACCC must take reasonable steps to inform those persons of the
terms and conditions and a person must comply with the terms and conditions.
Proposed subsection 151BUDA(5) requires a person to comply with the
terms and conditions specified in a determination under proposed subsection
151BUDA(3). A person who intentionally or recklessly contravenes the terms and
conditions specified in a notice is guilty of an offence punishable on
conviction by a fine not exceeding 100 penalty units (proposed subsection
151BUDA(7))). The penalty for non-compliance is greater here because of the
likelihood that the information available to persons specified in the direction
under proposed paragraph 151BUDA(2)(b) will be commercially sensitive and
therefore the consequences of non-compliance with specified terms and conditions
potentially more serious than a contravention of proposed subsection 151BUDA(6).
Proposed section 151BUDB applies to particular Ministerially-directed
reports given to the ACCC by a carrier or carriage service provider in
accordance with the record-keeping rules (subsection 151BUDB(1)) and deals with
the disclosure of reports, or extracts from reports, to the public or to
specified persons as directed by the Minister. Proposed section 151BUDB is not
intended to limit the current provisions in section 151BUB that apply to the
disclosure of reports (other than Ministerially-directed reports) by a carrier
or carriage service provider at the direction of the ACCC.
Where
required to do so by a Ministerial direction made under proposed section
151BUAA, the ACCC may give a carrier or carriage service provider a written
direction requiring it to make copies of a Ministerially-directed report or
copies of extracts from the report (and any other relevant material) available
to the public in the manner specified in the direction and as soon as
practicable after the end of the period specified in the direction. The ACCC
may also, where required to do so by a Ministerial direction under proposed
section 151BUAA, give a written direction to the carrier or carriage service
provider requiring it to make copies of a Ministerially-directed report or
copies of extracts from the report (and any other relevant material) available
to the public in the manner specified in the direction, on such terms and
conditions as are specified in the direction and as soon as practicable after
the end of the period specified in the direction (paragraph 151BUDB(2)(b)). The
carrier or carriage service provider must take reasonable steps to inform those
persons of the terms and conditions (if any) specified in a direction and a
person must comply with the terms and conditions.
If the ACCC gives a
direction to a carrier or carriage service provider under proposed paragraph
151BUDB(2)(a), the ACCC may also give it a direction to take such action as is
specified in the direction to inform the public that the report, or extracts,
are available and the way in which the report, or extracts, may be accessed. If
the ACCC gives a direction to a carrier or carriage service provider under
proposed paragraph 151BUBD(2)(b), the ACCC may also give it a direction to take
such action as is specified in the direction to inform the persons specified in
the direction that the report, or extracts, are available and the way in which
the report, or extracts, may be accessed.
A person who intentionally or
recklessly contravenes a direction under subsections 151BUDB(4) or (5) is
guilty of an offence punishable on conviction by a fine not exceeding 20 penalty
units (proposed subsection 151BUDB(7)).
A person who intentionally or
recklessly contravenes the terms and conditions on which a report or extract is
available is guilty of an offence punishable on conviction by a fine not
exceeding 100 penalty units (subsection 151BUDA(8))). The penalty for
non-compliance is greater here because of the likelihood that the information
available to persons specified in the direction under proposed paragraph
151BUDB(2)(b) will be commercially sensitive and therefore the consequences of
non-compliance with specified terms and conditions potentially more serious than
a contravention of subsection (7).
Carrier or carriage service
provider gives access to Ministerially-directed periodic
reports
Proposed section 151BUDC applies to particular
Ministerially-directed periodic reports given to the ACCC by a carrier or
carriage service provider in accordance with the record-keeping rules
(subsection 151BUDC(1)) and deals with the disclosure of periodic reports, or
extracts from periodic reports, to the public or to specified persons as
directed by the Minister. Proposed section 151BUDC is not intended to limit the
current provisions in section 151BUC that apply to the disclosure of periodic
reports (other than Ministerially-directed periodic reports) by a carrier or
carriage service provider at the direction of the ACCC.
Where required
to do so by a Ministerial direction made under proposed section 151BUAA, the
ACCC may give a carrier or carriage service provider a written direction
requiring it to make copies of a Ministerially-directed periodic report or
copies of extracts from the report (and any other relevant material) available
to the public in the manner specified in the direction and by such times as are
ascertained in accordance with the direction. The ACCC may also, where required
to do so by a Ministerial direction under proposed section 151BUAA, give a
written direction to the carrier or carriage service provider requiring it to
make copies of a Ministerially-directed periodic report or copies of extracts
from the report (and any other relevant material) available to persons specified
in the direction, in the manner specified in the direction, on such terms and
conditions as are specified in the direction and by such times as are
ascertained in accordance with the direction (paragraph 151BUDC(2)(b)). The
carrier or carriage service provider must take reasonable steps to inform those
persons of the terms and conditions (if any) specified in a direction and a
person must comply with the terms and conditions.
If the ACCC gives a
direction to a carrier or carriage service provider under proposed paragraph
151BUDC(2)(a), the ACCC may also give it a direction to take such action as is
specified in the direction to inform the public that the periodic report, or
extracts, are available and the way in which the report, or extracts, may be
accessed. If the ACCC gives a direction to a carrier or carriage service
provider under proposed paragraph 151BUDC(2)(b), the ACCC may also give it a
direction to take such action as is specified in the direction to inform the
persons specified in the direction that the periodic report, or extracts, are
available and the way in which the report, or extracts, may be accessed.
A
person who intentionally or recklessly contravenes a direction under subsection
151BUDC(4) or (5) is guilty of an offence punishable on conviction by a fine not
exceeding 20 penalty units (proposed subsection 151BUDC(7)).
A person
who intentionally or recklessly contravenes the terms and conditions on which a
periodic report or extract is available is guilty of an offence punishable on
conviction by a fine not exceeding 100 penalty units (proposed subsection
151BUDC (8)). The penalty for non-compliance is greater here because of the
likelihood that the information available to persons specified in the direction
under proposed paragraph 151BUDC(2)(b) will be commercially sensitive and
therefore the consequences of non-compliance with specified terms and conditions
potentially more serious than a contravention of proposed subsection 151BUDC(7).
Schedule 3 – Amendment of the Telecommunications (Carrier Licence
Charges) Act 1997
Item 1 – Paragraph
15(1)(d)
Item 1 amends paragraph 15(1)(d) by replacing the semi-colon
at the end of the paragraph with a full stop. The proposed amendment is
consequential to the proposed repeal of paragraph 15(1)(e) (see Item
2).
Item 2 – Paragraph 15(1)(e)
Section 15 specifies
the limit on the total charges that may be imposed on carrier licences in force
at the beginning of the financial year. Paragraph 15(1)(e) relates to the
proportion of the Commonwealth’s costs for the immediately preceding
financial year that is attributable to the administration of Part 2 of Schedule
1 to the Telecommunications Act. These costs are determined by the Industry
Minister by written instrument and form a component of the sum that the charges
imposed on carrier licences must not exceed under section 15.
Item 2
repeals paragraph 15(1)(e). The proposed amendment is consequential to the
proposed repeal of Part 2 of Schedule 1 to the Telecommunications Act
1997 (see Item 14 of Part 2 of Schedule 1 to the Bill).
Item 3
– Subsection 15(4) (definition of Industry
Minister)
Subsection 15(4) contains definitions of terms used in
section 15. “Industry Minister” is defined to mean the Minister for
Communications, Information Technology and the Arts or the Minister for the Arts
and Sport (the effect of the Acts Interpretation (Substituted References
– Section 19B) Amendment Order 2001 made by the Governor-General on 20
December 2001 is that the reference in clause 3 of Schedule 1 to the
“Minister for the Arts and Centenary of Federation” is read as the
“Minister for the Arts and Sport”).
Item 3 repeals the
definition of “Industry Minister”. The proposed amendment is
consequential to the proposed repeal of paragraph 15(1)(e) (Item 2). No other
reference to “Industry Minister” is made in the Act.
Item
4 - Application of amendments
Item 4 deals with the application of
the proposed amendments in Schedule 3. The amendments will apply in relation to
charges imposed on carrier licences in force at the beginning of the first
financial year where the financial year ends after the commencement of Item 4
and the immediately preceding year is a zero-cost year, or, a financial year
that is later than that first financial year. SubItem 4(1) defines a zero-cost
financial year as a financial year in which the Commonwealth did not incur any
costs that were attributable to the administration of Part 2 of Schedule 1 to
the Telecommunications Act 1997.
The effect of Item 4 will be that
paragraph 15(1)(e) will continue to apply (allowing the cost of the
administration of Part 2 of Schedule 1 of the Telecommunications Act to be
included in the ACA’s assessment of the charges on carrier licences) until
the end of a zero-cost financial year (ie until a financial year has passed in
which the Commonwealth did not incur any costs attributable to the
administration of the Part 2 of Schedule 1 to the Telecommunications
Act).
[1] The Streamlining amendments
incorporated a number of the recommendations from the PC Report on
Telecommunications Competition Regulation (No. 16 of 2001). These
recommendations were 10.5, 10.6, 10.8, 10.10, 10.11, 11.3, 11.4 and
14.4.
[2] Recommendation 5.1 of the
PC report.
[3] PC report, p224.