Bills Digest No. 107   1997-98 National Transmission Network Sale Bill 1997


Numerical Index | Alphabetical Index

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History

National Transmission Network Sale Bill 1997

Date Introduced: 30 October 1997
House: House of Representatives
Portfolio: Communications, the Information Economy and the Arts
Commencement: Royal Assent

Purpose

To make provision for the sale of Australia's national transmission network.

Background

Australia's national transmission network (NTN) carries television and radio signals for the ABC, SBS, some commercial radio and TV stations and community services, such as Radio for the Print Handicapped.It includes 1197 radio and television transmitters used to broadcast ABC and SBS radio and television services from 547 owned and leased sites, and 520 transmitters belonging to 167 licensed broadcasters.The facilities also house a large number of transmitters for radiocommunications operators such as telecommunications and mobile communications licensees (Telstra, Optus, Vodafone), police and emergency services, paging services, private mobile radiocommunications services, and data services.

The NTN is managed by the National Transmission Agency (NTA).The NTA once formed part of the Department of Communications but was established as a separate cost centre and directed to operate on a commercial basis nearly 5 years ago.The NTA is responsible for the technical planning, operation and maintenance of NTN facilities and has as its objective:

Cost effective management of broadcasting transmission facilities: to make possible reliable, high-quality reception of national broadcasting programs by the public; and optimum use of infrastructure funded by the Commonwealth by accommodating transmission equipment for licensed broadcasting and radiocommunications services.(1)

The NTA uses private contractors both to construct transmission facilities and to operate and maintain the established network on a day-to-day basis.

Telstra held a monopoly over the outsourced operation and maintenance of the network but under competitive tendering now shares the work with Broadcast Communications Ltd (BCL), a division of Television New Zealand Australia Pty Ltd (TVNZ)(which is majority owned by the New Zealand government).BCL holds a $A60 million contract with the NTA to operate and maintain 40% of the network's sites in Queensland, South Australia and the Northern Territory.

For the 1996-97 financial year the running costs of the NTA were $9 million (1995-96 $11.5 million).Capital expenditure was $30 million (1995-96 $40 million).(2) There were 111 staff years (1995-96 121 staff years).

Late last year the government announced that scoping studies of the NTA were to be conducted.Those studies were undertaken by Arthur Andersen Corporate Finance and the communications law firm, Gilbert and Tobin in the first half of this year.On 8 July 1997, Cabinet endorsed the sale of the NTN.

It is anticipated that BCL is a frontrunner to acquire the network.(3) It has been reported that TVNZ has coordinated a consortium to buy the network, although none of the details concerning consortium partners or structures have been revealed.It has been speculated that TVNZ through BCL will be a non-equity player offering technical advice, design and construction services, and operation and maintenance management.(4)

The government presently pays an amount to the NTA for the transmission of ABC and SBS signals.The purchaser ofthe network will be contractually bound to continue to transmission for the ABC and SBS and certain social policy obligations for a five year period.

Main Provisions

The Bill consists of seven Parts.Part 1 contains the commencement and definition provisions.

Part 2 - Sale of the National Transmission Network

Clause 7 of this Bill allows the Minister to determine that any identified network facility which is a fixture on non-Commonwealth land is deemed to be severed from the land and vests in the Commonwealth. Without this provision, a landowner upon whose land a transmission facility is situated could arguably claim that that facility has become affixed to the person's land and because of that it has become part of the land.The success of that type of argument would hinge upon the matters such as the degree of annexation (i.e. whether the facility was simply 'sitting on the land' or whether it was in fact attached to the land) and whether the facility was intended to become a fixture when it was placed on the land.

Clause 9 is the operative provision which provides for the vesting of assets and liabilities (including rights and obligations under contracts) in the new National Transmission Company (NTC).

As is usually the case, the vesting which occurs under clause 9 is free of any stamp duty or other tax which would otherwise be payable (clause 10).The stamp duty exemption does not extend to the duty payable on the ultimate transfer of shares in the NTC to the purchaser.That purchaser of those shares will be obliged to pay the applicable stamp duty.

Part 3 - Access to Services

Rather than creating a new access regime for the supply of broadcasting services, Part 3 applies, with some modifications, the access regime established for telecommunications to broadcasting services.The access regime for telecommunications is set out in Part XIC of the Trade Practices Act 1974.

Part XIC provides for the declaration by the ACCC of 'declared services'.Carriers who provide declared services are required to comply with certain 'standard access obligations' in relation to those services.The terms and conditions on which those standard access obligations are provided to service providers by carriers is a matter of negotiation between those parties.Part XIC provides a number of solutions where the parties to those negotiations cannot reach agreement on terms and conditions.More detail about this access regime can be obtained from the Bills Digest to the Trade Practices Amendment (Telecommunications) Bill 1996 (Digest No. 89 of 1996-97).

Clause 13 of this Bill applies that access regime to broadcasting services provided by the NTA.Under clause 13 the telecommunications access regime has effect as if:

  • each 'nominated service' were a declared service within the meaning contained in Part XIC,
  • each provider of a nominated service were a licensed carrier, and
  • each 'nominated customer' were a 'service provider' within the meaning contained in Part XIC.

The access regime only applies to nominated customers who are seeking access for a nominated purpose.The nominated customers and the relevant nominated purposes include (clause 15):

  • ABC and SBS for the purposes of carriage of national broadcasting services and access to sites and towers for purposes connected with national broadcasting services,
  • community broadcasting licensees for the purposes of supplying the Radio for the Print Handicapped service and access to sites and towers,
  • emergency service organisations for the purposes of access to sites or towers for purposes connected with radiocommunication transmissions,
  • commercial broadcasters for the purpose of accessing sites and towers in connection with providing commercial broadcasting services in declared remote areas.

Part 4 - Restrictions on transfer of assets

Clause 18 requires the NTC (or its successor) to obtain the Minister for Communications' approval before transferring any original asset (i.e. one that is transferred to the NTC under clause 9) or replacement asset (i.e. an asset which replaces an original asset).

The Minister is entitled to refuse the application on the basis that either:

  • the Minister has reason to believe the transfer may jeopardise continued access by a nominated customer to a nominated service for a nominated purpose, or
  • any other prescribed ground that relates to matters covered by the telecommunications power contained in the Constitution.

Part 5 - Transmitter licences

At present, the Commonwealth, in its capacity as provider of transmission services, holds the national broadcasting service (NBS) licence under section 100 of the Radiocommunications Act.The National Transmission Network Sale (Consequential Amendments) Bill 1997 amends section 100 to provide that an NBS licence may only be held by the ABC, SBS or the Commonwealth.

Clause 19 allows for the vesting of specified NBS transmitter licences in the ABC and SBS.

Part 6 - Powers and immunities of NTC or declared successor

Under section 61 of the Telecommunications Act 1997 a carrier must, as a condition of its licence, comply with the provisions of the Telecommunications Act 1997.

Part 1 of Schedule 3 of the Telecommunications Act 1997 accords certain rights to carriers in respect of the maintenance of telecommunications facilities (including towers, and overhead lines).

Clause 20 deems section 61 and Part 1 of Schedule 3 (and some relevant administrative provisions) to apply the NTC (or declared successor) in respect of any facilities owned by the NTC.

Part 7 - Miscellaneous

Clause 22 allows the Minister to declare a person to be a declared successor to the NTC.

Clause 24 provides an NTC (or declared successor) with immunity from certain State/Territory laws in respect of sites or telecommunications facilities which were owned by the Commonwealth or an NTC (or declared successor) and which were used in connection with a broadcasting service.

The remaining provisions of this part are administrative in nature.

Endnotes

  1. Department of Communications and the Arts, Annual Report 1996-97, page 81.
  2. Department of Communications and the Arts, Annual Report 1996-97, page 81.
  3. The Canberra Times, 'Asset sale could cost Canberra 70 jobs', Mike Taylor, 23 March 1997.
  4. Independent Business Weekly, 'TVNZ eyes Aussie transmitter', Vincent Heeringa, 24 Jan 1997.

Contact Officer and Copyright Details

Lee Jones
18 November 1997
Bills Digest Service
Information and Research Services

This paper has been prepared for general distribution to Senators and Members of the Australian Parliament. While great care is taken to ensure that the paper is accurate and balanced, the paper is written using information publicly available at the time of production. The views expressed are those of the author and should not be attributed to the Information and Research Services (IRS). Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion. Readers are reminded that the paper is not an official parliamentary or Australian government document.

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ISSN 1328-8091
© Commonwealth of Australia 1997

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Published by the Department of the Parliamentary Library, 1997.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 18 November 1997

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