ACCC begins public consultations on Telstra's exemption applications for fixed line services
The Australian Competition and Consumer Commission today issued two discussion papers in relation to fixed line service exemption applications from Telstra. This brings to seven the total number of exemption applications from Telstra currently being assessed by the ACCC.
The first discussion paper relates to Telstra's applications for exemption from the standard access obligations for the public switched telephone network originating service (PSTN OA). Telstra has sought exemption in a total of 404 exchange service areas (ESAs), comprising 17 ESAs in CBD areas and 387 ESAs in metropolitan areas.
The second discussion paper relates to Telstra's applications for exemption from the standard access obligations for the local carriage service (LCS) and wholesale line rental (WLR) service in 16 ESAs in metropolitan Australia. These exemption applications follow Telstra's earlier applications for LCS and WLR exemptions in 371 ESAs, lodged with the ACCC in July.
Telstra submits that there is sufficient competitive infrastructure in the proposed exemption areas such that regulation of these services is no longer necessary.
"Under the Trade Practices Act 1974, the ACCC must decide within six months whether granting Telstra the exemptions from its standard access obligations in the proposed exchange areas would be in the long-term interests of end users," ACCC Chairman, Mr Graeme Samuel, said today.
As part of assessing the exemption applications, the ACCC is inviting interested parties to respond to issues raised in the discussion papers. The ACCC is seeking comment on issues relevant to the consideration of the exemption applications, including market definition, current and potential state of competition in upstream and downstream markets, and the effect of the exemptions on incentives for efficient investment.
The ACCC will consider submissions in response to the two discussion papers which should be lodged with the ACCC by Friday, 14 December 2007. The discussion papers will be available on the ACCC website.
The PSTN originating access service (PSTN OA) allows access seekers to buy the carriage of telephone calls from a calling end-user to a point of interconnection (POI) with the access seeker's network. The service allows telecommunications companies to provide services such as national long-distance calls, international calls and calls between fixed and mobile networks.
The PSTN OA service was deemed to be a declared service under Part XIC of the Trade Practices Act 1974 in June 1997 and was re-declared by the ACCC for a period of three years in July 2006.
The local carriage service (LCS) is a wholesale local call service that allows access seekers to resell local calls to end-users.
The wholesale line rental service (WLR) involves the provision of a basic line rental service that allows an end-user to connect to the public switched telephony network (PSTN).
The LCS was declared by the ACCC in August 1999 and re-declared in July 2006. WLR was declared by the ACCC in July 2006.
Following the ACCC's decision to regulate a service under Part XIC, standard access obligations exist for any carriers or carriage service provider providing that service, whether to themselves or to other persons. The obligations include the requirement that the regulated service must be provided to service providers, along with specified ancillary services, on request.
A carrier can apply to the ACCC for a written order exempting it from any, or all, of the standard access obligations that apply to a regulated service. In deciding whether to make an order, or not, the ACCC must consider whether it will promote the long-term interests of end-users of the carriage services, or services provided by means of carriage services.
