The Government yesterday released exposure drafts of legislation to establish a regulatory framework for the National Broadband Network Company, NBN Co Limited (NBN Co). The two draft bills, released following a public consultation process on the legislative framework in July 2009 through which more than thirty submissions were received, are the:
- National Broadband Network Companies Bill 2010, and
- Telecommunications Legislation Amendment (National Broadband Network Measures – Access Arrangements) Bill 2010.
On the release of this draft legislation, Minister for Broadband, Communications and the Digital Economy, Senator Conroy said: “These bills deliver on the Rudd Government’s commitment to change the competitive dynamics of the telecommunications sector by ensuring NBN Co will operate as a wholesale-only company, offering open and equivalent access."
National Broadband Network Companies Bill 2010 (the NBNCo Bill)
The NBNCo Bill establishes the regulatory framework covering NBN Co’s ownership and operations, and deals with how the Commonwealth’s stake in NBN Co will be sold.
The NBNCo Bill comprises seven parts, arguably the most important of which are:
- Part 2 – which deals with the operations of NBN Co Limited, NBN Tasmania Limited and any additional wholly-owned subsidiaries of NBN Co, and details the rules about the supply of services by NBN Co, including that such supply must be on a wholesale basis
- Part 3 - which deals with the ownership and control of NBN Co and sets out the Commonwealth’s majority ownership provisions and arrangements for terminating those provisions and introducing an NBN Co sale scheme
- Part 4 – which sets out reporting obligations on NBN Co while the Commonwealth’s majority ownership provisions are in force, and
- Part 5 - which establishes an anti-avoidance mechanism under which NBN Co must not enter into or carry out a scheme for the purpose of avoiding the application of any provision of the Act.
Telecommunications Legislation Amendment (National Broadband Network Measures – Access Arrangements) Bill 2010 (the Access Bill)
The Access Bill amends the Trade Practices Act 1974 (the TPA) and the Telecommunications Act 1997 so as to introduce new access and equivalence obligations relating to the supply of wholesale services by NBN Co and its wholly-owned subsidiaries.
The Access Bill builds upon recent reforms to the telecommunications competition regime introduced through the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2009 (the CCS Bill), the goal of which was to reform the access regime in Part XIC of the TPA to reduce delays and opportunities for gaming and to provide upfront certainty as to access prices and terms. NBN Co will be subject to the reformed access regime implemented by the CCS Bill, but specific amendments are introduced by the Access Bill to reflect the unique wholesale only nature of NBN Co.
The Access Bill sets out three mechanisms under which NBN Co may provide services. Firstly, NBN Co may publish a Standard Form of Access Agreement (SFAA) in relation to a service, or give a Special Access Undertaking (SAU) to the ACCC in relation to the provision of access to a service. Secondly, if the Minister makes a condition of NBN Co’s carrier licence that it must supply a specified eligible service that NBN Co is not currently supplying, NBN Co must give a SAU or formulate an SFAA in relation to that service. Thirdly, the ACCC may declare a service that NBN Co has not indicated it will supply, but which the ACCC considers would be in the long-term interests of end-users to supply.
What happens next?
The Government is seeking feedback on the draft bills between now and 15 March 2010. Senator Conroy stated in the joint media release:
"Before we introduce the bills formally we are keen to seek further feedback from key stakeholders to ensure we get the details right. We have an open mind on any amendments put forward that we believe can improve the bills."
The Government then proposes to introduce the bills into Parliament in the Autumn or Winter sittings, depending on the feedback it receives.