Chapter 4
Services Ineligible to be Declared
Schedule 2
4.1
The bill proposes amendments to the TPA to allow new infrastructure
facilities to be classed as ineligible to be declared for a period of at least
twenty years.
4.2
The designated Minister would be able to provide a ruling, and would
receive advice from the National Competition Council regarding the decision. The
minister's decision is subject to merit review by the Tribunal and can be
revisited if there is a material change in arrangements.
4.3
This proposal came from the 2001 review by the Productivity Commission, Review
of the National Access Regime, which recommended that the designated
Minister determine that a facility would not meet the criteria, and then be given
exemption from declaration.
4.4
This would be similar to the 'no-coverage rulings' available for new gas
pipelines under the National Gas Law. The NCC, in its submission, stated
that the consistency between the existing ‘no-coverage rulings’ legislation and
that proposed in the amendment would also work to promote regulatory certainty.[1]
Purpose
4.5
The amendment is intended to provide greater regulatory certainty, clarity
and transparency by stating whether a new service could be declared or not, and
so stimulate potential investment.[2]
4.6
The NCC agrees that the amendment regarding ineligibility:
...will provide certainty to infrastructure investors that is
not currently available... the Council considers that the introduction of these
new provisions may increase certainty for investors and/or providers.[3]
4.7
The application for an ineligible service declaration may be made by 'any
person with a material interest in a service to be provided by a proposed
facility' and the Commonwealth, states
or territories may apply for the decision for services they provide.[4]
'New facilities' subject to this amendment include extensions to existing
facilities.
National Competition Council
Recommendation
4.8
Any person with a material interest in a service being declared
ineligible must apply in writing to the NCC for a recommendation to go to the
designated Minister.
4.9
The service must be found by the NCC not to satisfy at least one of the
criteria in section 44G of the TPA (listed in Table 1, paragraph 2.6 above).
4.10
The NCC may request information in order to make their recommendation. The
NCC, in its submission, opposed the amendment relating to the request for
information, although conceded information may sometimes not be provided in a
timely fashion:
The Council’s view at this time is that a power to compel
provision of information is unnecessary and would complicate the declaration
process...In failing to provide information requested by the Council, a service
provided can frustrate consideration of a declaration application. While the
Council’s experience to date has been that information requested is generally
provided, sometimes the timeliness of the provision of information has been
unsatisfactory.[5]
4.11
The expected period for the recommendation is 180 days, and is subject
to clock-stoppers.
Decision by the designated Minister
4.12
The Minister must make a decision within 60 days of receiving the
recommendation by the NCC. If the decision is not made, is it deemed to have
been in accordance with the NCC recommendation.
Review by the Tribunal
4.13
The Tribunal may review any decision by the designated Minister if a
person with a material interest in the case makes an application for this
within 21 days of the published decision.
Committee view
4.14
Stronger time limits are needed for the decision-making process in
relation to the NCC recommendation. Requests for further information should not
slow down the process, nor should time limits impinge on the complexity of the
case. A balance is required in order to make the correct decision in a timely
manner after considering the relevant information.
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