Fixed Services Review – Declaration Inquiry Public inquiry into the fixed line services declarations Draft Report December 2013
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Duration of declarationsThe ACCC must determine an appropriate duration for any declarations that may emerge from this inquiry. Section 152ALA(1) of the CCA requires the ACCC to specify an expiry date for a declaration. In specifying an expiry date, the ACCC must have regard to the principle that an expiry date should occur within the period that begins three years after the declaration was made and ending five years after the declaration was made, unless the ACCC forms the opinion that there are circumstances that warrant a longer or shorter declaration period.262 This is intended to enable the ACCC to provide longer-term regulatory certainty, where appropriate, in order to promote competition and investment.263 Subsection 152ALA(4) allows the ACCC to extend or further extend the expiry date of a specified declaration as long as the extension or further extension is for a period of not more than five years. Submissions from iiNet, AAPT, Optus and Macquarie Telecom considered that the fixed line service declarations should be extended for a five year period.264 Telstra submitted that a duration of 3-5 years would be appropriate.265 ACCAN submitted that the length of the declaration should be guided by the NBN rollout completion dates.266 Several submitters noted the importance of regulatory certainty in the transition to the NBN. AAPT submitted that declaration would have the benefit of providing certainty to industry during a period of significant change.267 Optus submitted that the ACCC will be in a better position to assess the impact of the NBN on the CAN closer to 2019.268 Macquarie Telecom submitted that there is a need to provide operators and investors with a more certain operating environment and that ‘it is unlikely that changes which are occurring in the telecommunications sector such as the roll-out of the NBN and the growth in VoIP services will materially affect Telstra’s control of bottleneck services over the next five years.’269
The ACCC notes that the rollout of the NBN is expected to continue over the next five years. The ACCC considers that during this period, it is likely that Telstra will retain control of the copper network and that this network will remain an essential bottleneck facility. Additionally, the ACCC considers that a five-year regulatory period will provide a degree of certainty and facilitate business planning during the transition to the NBN, which will in turn promote efficient investment decisions by both Telstra and access seekers. Accordingly, the ACCC considers that the fixed line services should be declared for a further five year period with an expiry date of 31 July 2019.
The deployment of new access networks, or the introduction of new higher quality services over existing access networks, could also raise questions as to whether adjustments to the scope of access regulation is needed to promote the LTIE. Wholesale access to these new networks or services on reasonable terms could potentially become an important facilitator of competition in the future, for example, access to fibre services or VDSL services (such as those supplied using a node in large buildings.) Under present regulatory settings, these new or emerging services would be declared only where they are supplied by a NBN corporation or a provider of the local bitstream access service (LBAS). Whether broader application of access regulation to these services is warranted will likely depend upon the importance of that access to competition in the transitional period, as well as the preparedness of network operators to provide wholesale access on reasonable terms and conditions. Should any competition concerns emerge in relation to new or emerging networks and services, the ACCC will consider how best to respond, depending on the circumstances, including using processes in Parts XIB and XIC of the CCA. Proposed service description for the ULLSDeclared service The Australian Competition and Consumer Commission declares pursuant to section 152AL(3) of the Competition and Consumer Act 2010 (the Act) that the unconditioned local loop service (ULLS) is a ‘"declared service"’ for the purposes of Part XIC of the Act. Date The declaration takes effect on 1 August 20092014 and expires on 31 July 20142019. Service description The unconditioned local loop service is the use of unconditioned communications wire between the boundary of a telecommunications network at an end-user’s premises and a point on a telecommunications network that is a potential point of interconnection located at or associated with a customer access module and located on the end user side of the customer access module. Definitions Where words or phrases used in this declaration are defined in the Competition and Consumer Act 2010 Trade Practices Act 1974 or the Telecommunications Act 1997, they have the meaning given in the relevant Act. In this Appendix:
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