Part XIC of the Trade Practices Act enables the ACCC to declare telecommunications services. Upon declaration, standard access obligations apply.
If a service is declared, the carrier and carriage service provider that provides the declared service must meet the 'standard access obligations' prescribed under the Act.
The ACCC has the ability to vary or revoke declarations, but with the exception of minor changes, must hold a public inquiry ahead of such changes.
ACCC issues MTAS declaration final report
On 1 June 2009 the ACCC released the final report on its public inquiry into the declaration of the domestic mobile terminating access service (MTAS) deciding to extend the existing MTAS declaration for a period of five years to 30 June 2014. The ACCC has formed the view that mobile call termination remains an essential service and that extending the MTAS declaration for five years is in the long-term interest of end users.
ACCC proposes a five year extension for key telecommunications declarations
On 4 June 2009 the ACCC issued its draft decision to extend the declarations that enable Telstra’s competitors to provide fixed voice and broadband services over Telstra’s copper network for a further five years. The six fixed-line services considered are the unconditioned local loop service (ULLS), the line sharing service (LSS), the local carriage service (LCS), wholesale line rental (WLR), public switched telephone network (PSTN) originating access (OA) and terminating access (TA).
Submissions responding to the draft decision were due by 25 June 2009.
The draft decision can be viewed on the ACCC website.
The declared services register can be viewed on the ACCC website.
Exemptions from access obligations
The Act enables carriers to apply for exemptions from the standard access obligations that apply to a declared service. The ACCC can only grant exemptions where they promote the long term interests of end users.
All exemption applications processes can be viewed on the ACCC website.
Access Undertakings
Division 5 of Part XIC of the Act enables access providers to voluntarily lodge written access undertakings with the ACCC specifying the terms and conditions upon which they agree to supply a specified service. The ACCC can accept or reject the undertaking.
The list of current access undertakings can be viewed on the ACCC website.
Access disputes
The ACCC is able to arbitrate telecommunications access disputes and make a final binding determination to resolve a dispute. Arbitration hearings are private and the ACCC generally does not make any public comment on disputes except to announce when a dispute has been notified.
New access disputes
In June 2009 two new access disputes were notified to the ACCC. The first dispute was notified by Pipe Networks Pty Ltd, involving facilities access between Telstra and itself pursuant to the Telecommunications Act 1997. The second dispute was notified by Vodafone Network Pty Ltd under Part XIC of the Act, between itself and Telstra Corporation Ltd concerning mobile terminating access service.
The current list of arbitrations can be viewed on the ACCC website.
Final and interim determinations
In June 2009 the ACCC did not make any interim or final determinations. However it extended the operation of 11 interim determinations made in arbitration of access disputes in relation to the supply of ULLS for further 12 months.
The register of final and interim determinations can be viewed on the ACCC website.
Published determinations
During June 2009 the ACCC did not publish any determinations made in the arbitration of access disputes.
All published determinations can be viewed on the ACCC website.
In June 2009 the ACCC published two communications related reports as follows:
ACCC telecommunications reports 2007–08
On 15 June 2009 the ACCC's annual telecommunications reports on competition and pricing for 2007–08 were tabled in parliament. The reports show that service prices declined universally in 2007–08 with a 5.5 per cent decline in fixed-line service prices, 5.4 per cent decline in mobile voice services and 6.2 per cent decline in internet services. The reports also noted that there was ongoing investment in the industry, including:
increased take-up of regulated unbundled services, enabling companies to invest, innovate and compete more strongly for broadband customers
enhancements to the coverage and data capacity of 3G networks
increase in the peak network speeds of Telstra and Optus’ cable networks.
The reports also noted that the industry continues to have an extremely high level of disputes and litigation. At the same time, the level of consumer complaints has reached new heights.
On 11 June 2009 Ed Willett, a commission member at the ACCC, delivered a speech on ‘Competition regulation in a changing environment’ at the Broadband Australia 2009 Conference held in Sydney.
Water charge (infrastructure) rules—final advice provided
The ACCC submitted its final advice on water charge (infrastructure) rules to the Minister for Climate Change and Water on 26 June 2009.
This followed extensive stakeholder consultation including the release of two issues papers, a position paper and draft advice, including draft rules. The minister may adopt the ACCC's recommended rules, with or without variation.
Water Market Rules 2009 and Water Charge (Termination Fees) Rules 2009—rules registered
The Water Market Rules 2009 and Water charge (termination fees) rules 2009 commenced on 23 June 2009 after being registered by the minister in accordance with the Water Act 2007.
The minister accepted and adopted the advice provided by the ACCC in December 2008, giving public notice of her intention to make the rules on 11 February 2009.
In making the rules the minister has extended the transitional period to 31 August 2009 for the Water Charge (Termination Fees) Rules and 31 December 2009 for the Water market rules.
Water Market Rules 2009 and Water Charge (Termination Fees) Rules 2009—guides released
To coincide with the release of the rules, the ACCC has released two guides for irrigators to explain how irrigators can transform their irrigation rights, and two comprehensive guides for operators to provide technical guidance on complying with the rules. The guides are available at www.accc.gov/guides or via post.
The procedures distributors must follow when preparing accounting statements for regulated parts of their businesses are outlined in their cost allocation methodologies. They also include the preparation of forecast operating and capital expenditure in accordance with the National Electricity Rules.
On 19 June 2009 the AER approved the proposed cost allocation methodology of the Tasmanian distribution business Aurora Energy, having determined that it was consistent with the AER’s cost allocation guidelines and the requirements of the National Electricity Rules. Electricity distributors are required to submit cost allocation methodologies to the AER for approval.
The AER sought expert advice from accounting consultant, McGrathNicol Corporate Advisory, to assist in the assessment of Aurora Energy’s proposed methodology. The AER’s final decision and Aurora Energy’s CAM is available at www.aer.gov.au.
Final decision—exclusions from Victorian service incentive scheme for supply reliability
On 5 June 2009 the AER published its final decision on applications by Victorian electricity distributors, requesting exclusion from the Victorian service incentive scheme for supply reliability. These interruptions were due to transmission network incidents in November-December 2008.
The AER assumed economic regulation of Victorian electricity distribution services from the Essential Services Commission on 1 January 2009. The AER decided that the four supply interruption events met the exemption criterion of the supply reliability financial incentive scheme, under the Essential Services Commission’s Electricity distribution price review 2006–10.
The scheme consists of guaranteed service level payments to customers for low reliability and a service term (s-factor) in the price control formula.
Amendments to Envestra’s Queensland access arrangement
On 19 June 2009 the AER decided to amend Envestra's Queensland access arrangement under clause 68 of the National Gas Rules.
The amendments made to the access arrangement relate solely to a misdescription in one of Envestra’s tariff zones. The AER considered that the 'Dinmore zone' had been misdescribed in the access arrangement, as it did not achieve the intended objective of the tariff zone as described by the Queensland Competition Authority (QCA) in its 2006 final decision.
Accordingly the Dinmore zone has been replaced in the access arrangement by the Riverview zone, which reflects the intent of the QCA in approving Envestra’s Queensland access arrangement.
Annual Tariff Variation approvals
In June 2009 the AER approved the annual tariff variations for 2009–10 for the following pipelines transmission and distribution pipelines:
ActewAGL Gas Distribution System in ACT and Greater Queanbeyan
Administrative decisions for Jemena Gas Networks (NSW)
Consolidation of access arrangements
On 9 June 2009 the AER directed Jemena Gas Networks (NSW) Ltd (Jemena) to consolidate its four access arrangements (for the two trunk pipelines, plus the Central West distribution network and the Wollongong–Sydney–Newcastle distribution network) into one access arrangement, subject to certain conditions. The full terms of the consolidation direction and statement of reasons for the decision can be found on the AER’s website.
Extension to submit access arrangement proposals
On 9 June 2009 the AER granted the Jemena’s extension request, moving the scheduled date for submission of Jemena’s access arrangement revision proposals to be on or before 9.00 am A.E.S.T. on Wednesday, 26 August 2009. The statement of reasons for the decision can be found on the AER’s website.
VENCorp’s proposed wholesale gas budget and market fees for 2009–10
On 5 June 2009, the AER approved VENCorp’s proposed wholesale gas budget and market fees for 2009–19.
VENCorp applied for the following adjustments to its market service fees for 2009–10:
an increase in the commodity tariff-D and commodity tariff-V rates of 13 per cent
an increase in the system security tariff of 252 per cent
a decrease in the distribution meter data management tariff of one per cent
no change to the transmission meter data management tariff or the registration tariff.
Prices above $5000/MWh
From 1 June to 19 June inclusive, the spot price in Tasmania exceeded $5000/MWh on 13 occasions. Preliminary analysis suggests that reductions in the output of Hydro Tasmania’s non-scheduled generation (mini-hydro) in conjunction with its bidding strategy for the rest of its portfolio were the significant drivers in the majority of these outcomes.
In accordance with the requirements of the National Electricity Rules, the AER will soon release reports analysing why the spot price exceeded $5000/MWh on these occasions.
Revised compliance and enforcement statement of approach
In June 2009 the AER published its revised Compliance and enforcement—statement of approach explaining the AER’s enforcement obligations, its approach to monitoring compliance with the electricity and gas rules and the enforcement options available. The publication was aimed at providing greater transparency about the AER’s compliance and enforcement program, with the intention of helping market participants to understand their obligations and encouraging compliance with the rules.
