Fixed Services Review – Declaration Inquiry Public inquiry into the fixed line services declarations Draft Report December 2013



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Introduction


The Australian Competition and Consumer Commission (ACCC) is holding a public inquiry into the declarations of the fixed line services. This declaration inquiry is part of the overall review of the fixed line services (Fixed Services Review), which also includes an inquiry into making Final Access Determinations (FADs) for the declared fixed line services.2

Under section 152(3) of the Competition and Consumer Act 2010 (CCA), the ACCC may declare an eligible service following a public inquiry under Part 25 of the Telecommunications Act 1997 (Telecommunications Act), provided it is satisfied that the making of the declaration will promote the long-term interests of end-users of carriage services or services provided by means of carriage services.


Background


In 2009 the ACCC extended the declaration of six fixed line services until 31 July 2014. The fixed line services are made up of the unconditioned local loop service (ULLS), line sharing service (LSS), local carriage service (LCS), wholesale line rental (WLR) service, domestic public switched telephone network originating access (PSTN OA) service and public switched telephone network terminating access (PSTN TA) service. A summary of the ACCC’s reasons for making these declarations in 2009 can be found in chapter 4 of the July 2013 discussion paper.

During the 18 month period preceding the expiry of the declarations, the ACCC is required to conduct a public inquiry to determine whether the existing declarations should be extended, revoked, varied, allowed to expire or expire and a new declaration made. In accordance with these provisions the ACCC commenced a declaration inquiry into six fixed line telecommunication services on 11 July 2013.


Declaration inquiry process to date


On 11 July 2013 the ACCC released a discussion paper to assist interested parties in preparing submissions to the declaration inquiry. As part of its declaration inquiry, the ACCC invited submissions on whether stakeholders consider the currently declared services should be extended, the service descriptions for the existing declared services should be varied, and whether the ACCC should conduct further inquiries into declaring additional services. The ACCC received a number of submissions from ten parties in response to its discussion paper (see appendix G).

On 13 September 2013, the ACCC wrote to all parties who had made submissions to the July 2013 discussion paper, outlining its expectation that parties will agree on and establish arrangements for the disclosure of confidential information with appropriate protections. The ACCC considers that, by providing sufficient transparency over the basis for its decisions, it will ensure that there is an appropriate balance between protecting the genuinely confidential information of parties and promoting confidence in the robustness of the its regulatory processes.

In response to the July 2013 discussion paper, the ACCC received a number of submissions in respect of whether CBD exemptions should be removed from the WLR and LCS service descriptions. The ACCC considered it needed additional information to enable it to make a well informed and robust decision on this issue. The ACCC issued an information request to a number of stakeholders on 9 October 2013. Responses were received from six parties.

Other related inquiries


On 11 July 2013 the ACCC also commenced an inquiry into making FADs for the six fixed line services and the wholesale ADSL service. The FADs set out the prices and non-price terms and conditions of access for these services and expire on 11 July 2014.

On 13 December 2013 the ACCC published a notice to extend the decision making period for these FADs to 11 July 2014. The notice is published on the public register maintained by the ACCC. The ACCC will require more time to complete its FAD inquiry so that it can assess the large amount of complex expenditure and demand forecast data provided by Telstra in late November 2013. In addition, the ACCC considers it appropriate to complete this declaration inquiry before making new FADs for these services to give industry certainty about the scope of the ACCC’s regulation.

The ACCC can extend or further extend the period for the FAD inquiry by period of six months provided it publishes a notice on its website explaining the reasons for each extension. The ACCC may need to consider a further extension if necessary to fully consider submissions to the inquiry and the implications of potential technological, commercial and policy developments that may occur during the course of its FAD inquiry.

The ACCC is also conducting declaration inquiries into the Domestic Transmission Capacity Service (DTCS) and the Mobile Terminating Access Service (MTAS). Where appropriate, the ACCC has adopted a consistent approach to the issues raised in this inquiry to those considered by the declaration inquiries for the DTCS and MTAS.


Making a submission on the draft report


After considering submissions to the July 2013 discussion paper, responses to the ACCC’s information request and undertaking its own analysis, the ACCC has determined its draft position about which fixed line services should be declared from 1 August 2014, and is proposing a number of changes to some existing service descriptions. The proposed service descriptions are set out in appendices A-F. The ACCC encourages industry participants and other interested parties to make submissions on this draft report.

To foster an informed and consultative process, all submissions will be considered as public submissions and will be posted on the ACCC’s website. Interested parties wishing to submit commercial-in-confidence material to the ACCC should submit both a public and a commercial-in-confidence version of their submission. The public version of the submission should clearly identify the commercial-in-confidence material by bookending the confidential material with an appropriate symbol or ‘c-i-c’.

The ACCC expects that claims for commercial-in-confidence status of information by parties will be limited in order to promote transparency and broad participation in the public inquiry.

The ACCC-AER information policy: the collection, use and disclosure of information sets out the general policy of the ACCC and the Australian Energy Regulator on the collection, use and disclosure of information. A copy of the guideline can be downloaded from the ACCC’s website.

The ACCC prefers to receive submissions in electronic form, either in PDF or Microsoft Word format which allows the submission text to be searched. Please contact Jessica Wicks regarding any questions you have concerning the consultation process on (03) 9658 6461.

Submissions are due on 14 February 2014.




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