Chapter 1 - Introduction

[1]        Journals of the Senate, 22 June 2017, p. 1542.

[2]        Journals of the Senate, 8 August 2017, p. 1607.

[3]        Structural separation refers to the separation of a company's retail and network infrastructure businesses. Telstra's structural separation involves the migration of Telstra's fixed line voice and broadband services to the NBN. For more information, see Department of Communications and the Arts, 'Telstra's separation framework', www.communications.gov.au/what-we-do/internet/competition-broadband/telstras-separation-framework.

[4]        Explanatory Memorandum (EM), CC Bill, p. 2; Carrier Licence Conditions (Networks supplying Superfast Carriage Services to Residential Customers) Declaration 2014, Explanatory Statement, pp. 1–2.

[5]        The EM for the CC Bill notes that real estate development projects will instead be covered by proposed new section 143E and that the Minister will be able to grant exemptions for specific new developments or class of developments under certain circumstances. See EM, CC Bill, p. 4.

[6]        EM, CC Bill, p. 5.

[7]        EM, CC Bill, p. 5; The Hon Paul Fletcher MP, Minister for Urban Infrastructure, Second Reading Speech, CC Bill, Proof House of Representatives Hansard, 22 June 2017, p. 9.

[8]        EM, CC Bill, p. 6.

[9]        On this proposal, the EM notes: 'Although criminal penalties can be invoked for breaches of some competition laws, they are usually applied in relation to conduct that is especially egregious (e.g. cartel conduct). The Government therefore considers civil penalties more appropriate in the context of Part 8'. EM, CC Bill, pp. 6–7.

[10]      EM, CC Bill, p. 7.

[11]      EM, CC Bill, p. 3. Further information about the grandfathering arrangement is provided at pages 3–4 of the EM for the CC Bill.

[12]      EM, CC Bill, p. 3

[13]      EM, CC Bill, p. 21.

[14]      The EM notes that, for example, a carrier could become a SIP if it has a contract to provide infrastructure in a new development. EM, CC Bill, p. 8.

[15]      EM, CC Bill, p. 9.

[16]      NBN Co, Submission 7, p. 1.

[17]      The matters about which the Minister may set standards, rules or benchmarks are outlined in proposed section 360U and 360V of the Tel Act. The relevant EM acknowledges the matters that could be specified 'are broad', including timeframes for connecting premises and rectifying faults, as well as rules regarding how premises must be connected and how complaints must be addressed. CC Bill, schedule 3, item 7 (Tel Act, proposed sections 360U and 360V); EM, CC Bill, p. 10.

[18]      EM, CC Bill, pp. 8–9.

[19]      EM, CC Bill, p. 10.

[20]      CC Bill, schedule 3, item 7 (Tel Act, proposed section 360S); EM, CC Bill, p. 10.

[21]      The Hon Paul Fletcher MP, Minister for Urban Infrastructure, Second Reading Speech, CC Bill, Proof House of Representatives Hansard, 22 June 2017, p. 10.

[22]      EM, CC Bill, p. 11.

[23]      The Hon Paul Fletcher MP, Second Reading Speech, CC Bill, Proof House of Representatives Hansard, 22 June 2017, p. 10.

[24]      EM, RBS Bill, p. 4.

[25]      EM, CC Bill, pp. 12–13.

[26]      The EM notes that while such services are not intended to be captured by the RBS, it is intended that the RBS provisions 'capture a line that runs most of the way to the premises but is then connected to the premises over a short distance using wireless or mobile technology'. EM, CC Bill, p. 13.

[27]      EM, CC Bill, pp. 13–14.

[28]      EM, RBS Bill, p. 2.

[29]      The base cost would be indexed annually to the consumer price index. The administrative cost will range between $0 and $0.01266 for the first five years, and then be indexed annually based on the charge applied in the fifth year. The RBS Bill provides that, in the fifth year, the administrative cost would be either $0 or another amount determined by the Minister. According to the proposed statutory formula for the administrative cost for year 6 and onwards, if another amount has not been set the cost would remain at $0 for future years. See RBS Bill, clauses 16(5)–(7).

[30]      RBS Bill, clauses 12(4)–(6), 13, 16(8)–(10) and 17.

[31]      It is proposed that the period for disallowance would differ from the ordinary process set out in the Legislation Act 2003 to 'maximise opportunity' for parliamentary scrutiny of any determinations made (EM, RBS Bill, p. 71). This proposed modification to the usual disallowance process is discussed in Chapter 3.

[32]      The Hon Paul Fletcher MP, Second Reading Speech, CC Bill, Proof House of Representatives Hansard, 22 June 2017, p. 10. In its May 2017 final determination on prices and other terms and conditions for wholesale high speed internet services supplied by non-NBN fixed line networks, the ACCC decided that non-NBN networks would be permitted to pass on the proposed RBS charge to their wholesale customers. See ACCC, Superfast Broadband Access Service and Local Bitstream Access Service Final Access Determination joint inquiry: Final decision report, May 2017, p. 24.

[33]      EM, CC Bill, p. 17.

[34]      EM, CC Bill, p. 17.

[35]      EM, CC Bill, pp. 17–18.

[36]      EM, CC Bill, p. 14.

[37]      The ACCC and ACMA would also be authorised to disclose information to certain government entities and the Regional Telecommunications Independent Review Committee. EM, CC Bill, p. 18.

[38]      CC Bill, schedule 4, item 13 (Telecommunications (Consumer Protection and Service Standards) Act 1999, proposed section 102ZFA); EM, CC Bill, p. 19.

[39]      The designated day is the date from which Telstra will be subject to structural separation obligations set out in its structural separation undertaking. EM, CC Bill, p. 19.

[40]      EM, CC Bill, p. 19.

[41]      Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, August 2017, pp. 33–40.

Chapter 2 - Stakeholder views and key issues

[1]        These organisations are: AgForce Queensland, Australian Communications Consumer Action Network (ACCAN), Australian Forest Products Association, Better Internet for Rural, Regional & Remote Australia, Broadband for the Bush Alliance, Cotton Australia, Country Women's Association of Australia, Country Women's Association of New South Wales, Country Women's Association of South Australia, GrainGrowers, Isolated Children's Parents' Association, National Farmers' Federation (NFF), National Rural Health Alliance, Northern Territory Cattlemen's Association, NSW Farmers, The Pastoralists' Association of West Darling, Queensland Farmers' Federation, Ricegrowers' Association of Australia, Victorian Farmers Federation and WAFarmers.

[2]        Regional, Rural and Remote Communications Coalition, Submission 1, p. 1.

[3]        Department of Communications and the Arts, Submission 10, p. 1.

[4]        Department of Communications and the Arts, Submission 10, p. 2.

[5]        Vocus Group, Submission 4, p. 3.

[6]        Although it supports the proposed change, Superloop considers there would be merit in defining the term 'residential customers' to exclude certain types of accommodation where residents obtain services from the accommodation provider (such as hospitals, hostels, hotels and motels, aged care facilities, university colleges and halls of residence, and purpose built student housing accommodation facilities). Superloop, Submission 15, p. 2.

[7]        Optus, Submission 13, p. 8.

[8]        Telstra provided the following examples to illustrate its concerns: '[W]here a network supplies services to business customers in a business park which is located within a residential suburb, even though the use of lines to supply services to a small number of residential customers is minor, it is hard to see that the network is not also being marketed to residential customers (given products are sold using the network). Another example where we envisage a mixed use network would be caught by the [superfast network obligations] is in a predominantly commercial area where there are shops downstairs along the street but where people live upstairs'. Telstra, Submission 9, pp. 22–23.

[9]        Telstra, Submission 9, p. 23. Telstra noted that 'wholly or principally' is currently used in section 141 of the Tel Act as part of the definition of a superfast broadband network.

[10]      Telstra, Submission 9, p. 23.

[11]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 3. See also Explanatory Memorandum (EM), CC Bill, pp. 124–25.

[12]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 3.

[13]      In the department's view, Telstra's concerns: 'fail to recognise the underlying policy that networks servicing residential customers should be wholesale-only (i.e. structurally separated) and that any carriers wishing to market (and operate) a network as both a business and residential network should undertake structural or functional separation for local access lines used to service residential customers'. Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 4.

[14]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 4.

[15]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), pp. 4–5.

[16]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 4.

[17]      EM, CC Bill, p. 94.

[18]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 2.

[19]      TPG Telecom, Submission 2, p. 7.

[20]      Telstra, Submission 9, p. 18.

[21]      TPG Telecom, Submission 2, p. 8.

[22]      The following example was provided to illustrate Telstra's concerns: '[W]hile the exemption appears to allow a new premises that is the result of a subdivision on a block in a street that is already connected to the network to be provided, it would appear not to allow a premises to be connected where land adjacent to that street is rezoned and the infrastructure has to be extended to that development in order to supply services to a premises'. Telstra, Submission 9, pp. 18–19.

[23]      Telstra, Submission 9, p. 21.

[24]      Telstra, Submission 9, p. 21.

[25]      Department of Communications and the Arts, Answers to questions on notice (received 22 August 2017), p. 2.

[26]      Productivity Commission, Telecommunications Universal Service Obligation, Report no. 83, April 2017, p. 265.

[27]      Productivity Commission, Telecommunications Universal Service Obligation, p. 11.

[28]      ACCAN, Submission 8, p. 3.

[29]      ACCAN, Submission 8, p. 3.

[30]      Cotton Australia, Submission 5, p. 1.

[31]      Optus, Submission 13, p. 9.

[32]      See Professor Mark Gregory, Submission 14, p. 5.

[33]      Department of Communications and the Arts, Submission 10, p. 3.

[34]      Department of Communications and the Arts, Submission 10, p. 3.

[35]      Department of Communications and the Arts, Submission 10, p. 3.

[36]      Telstra, Submission 9, p. 5.

[37]      Telstra, Submission 9, p. 6.

[38]      Mr Phillip Mason, Assistant Secretary, Telecommunications Competition, Department of Communication and the Arts, Committee Hansard, 10 August 2017, p. 20.

[39]      Telstra, Submission 9, p. 6.

[40]      Telstra, Submission 9, p. 6.

[41]      CC Bill, schedule 3, part 1, item 7 (proposed ss. 360Q(1B) and 360Q(2A) of the Tel Act).

[42]      EM, CC Bill, p. 133.

[43]      Department of Communications and the Arts, Submission 10, p. 3.

[44]      NFF, Submission 1, p. 2. This comment was supported by Cotton Australia (see Submission 5, p. 2).

[45]      Telecommunications Industry Ombudsman, Submission 12, p. 2.

[46]      Telstra, Submission 9, p. 7.

[47]      Telstra, Submission 9, p. 7.

[48]      Telstra, Submission 9, p. 7.

[49]      This is an option available to the Minister: see EM, CC Bill, p. 54.

[50]      NFF, Submission 1, p. 2; Rural Regional and Remote Communications Coalition, Submission 2, p. 1; Cotton Australia, Submission 5, p. 2; ACCAN, Submission 8, p. 7.

[51]      NFF, Submission 1, p. 2.

[52]      Vodafone Hutchison Australia, Submission 6, p. 1.

[53]      Vocus Group, Submission 4, p. 2.

[54]      Vocus Group, Submission 4, pp. 3–4, 6.

[55]      OptiComm, Submission 11, pp. 4, 11, 14; Vocus, Submission 4, p. 5. TPG also noted the upcoming arrival of 5G mobile services; see TPG, Submission 2, p. 6.

[56]      Mr Tony, General Counsel, TPG Telecom, Committee Hansard, 10 August 2017, p. 7.

[57]      TPG Telecom, Submission 2, p. 1.

[58]      Telstra proposed that the start date of the RBS be delayed by one year to 1 July 2019 and that, if necessary, the levy amount could be increased to cover the revenue from 2018 that would be foregone. Mr James Shaw, Director, Government Relations, Corporate Affairs, Telstra, Committee Hansard, 10 August 2017, p. 1.

[59]      Telstra, Submission 9, pp. 9–17.

[60]      A Telstra representative explained that '[i]t's just simpler for our systems to use existing concepts rather than create new concepts and then build a system around them'.
Mr James Shaw, Telstra, Committee Hansard, 10 August 2017, p. 3.

[61]      Mr Bill Gallagher, General Counsel, Corporate Affairs and Telstra Wholesale, Telstra, Committee Hansard, 10 August 2017, p. 3.

[62]      Mr Luke Van Hooft, Director, Economic Regulation, Corporate and Regulatory Affairs, Optus, Committee Hansard, 10 August 2017, p. 16.

[63]      Optus, Submission 13, pp. 4–8.

[64]      Mr Andrew Sheridan, Acting Vice President, Corporate and Regulatory Affairs, Optus, Committee Hansard, 10 August 2017, pp. 16–17.

[65]      Optus, Submission 13, pp. 2, 3.

[66]      NBN Co, Submission 7, pp. 2, 3.

[67]      NBN Co, Submission 7, p. 2. NBN Co's evidence on the rationale for including business services in the RBS was supported by the department. Mr Philip Madsen stated that, from the beginning, the NBN model covered 'all premises in Australia, including business and residential'. Mr Madsen remarked: 'The notion that it's now entering into the business market puzzles me'. Mr Philip Madsen, Assistant Secretary, Telecommunications Competition Branch, Department of Communications and the Arts, Committee Hansard, 10 August 2017, p. 22.

[68]      NBN Co, Submission 7, p. 2.

[69]      NBN Co, Submission 7, p. 3.

[70]      Department of Communications and the Arts, Submission 10, p. 5. See also EM, RBS Bill, p. 4.

[71]      Department of Communications and the Arts, Submission 10, p. 5. These measures are discussed in Chapter 1.

[72]      Mr Andrew Madsen, Department of Communications and the Arts, Committee Hansard, 10 August 2017, p. 19.

[73]      Mr Andrew Madsen, Department of Communications and the Arts, Committee Hansard, 10 August 2017, p. 19.

[74]      Mr Andrew Madsen, Department of Communications and the Arts, Committee Hansard, 10 August 2017, p. 19.

[75]      Department of Communications and the Arts, Submission 10, pp. 5–6.

[76]      Ms Caroline Lovell, Chief Regulatory Officer, NBN Co, Committee Hansard, 10 August 2017, p. 22.

[77]      Productivity Commission, Telecommunications Universal Service Obligation, pp. 325–26.

Chapter 3 - Parliamentary scrutiny of the Regional Broadband Scheme and overall committee view

[1]        Proposed subsection 76AA(2) of the TCPSS Act.

[2]        Explanatory Memorandum (EM), CC Bill, p. 164.

[3]        For the legislative instruments relating to the RBS charge referred to in paragraph 3.4, the special disallowance process that would apply is set out in clause 19 of the RBS Bill. For the legislative instruments relating to the definition of designated broadband service, the disallowance process that would apply is set out in proposed section 102ZFB of the TCPSS Act.

[4]        Legislation Act 2003, s. 42(1) and (2).

[5]        CC Bill, schedule 4, item 13 (proposed section 102ZFB of the TCPSS Act); RBS Bill, clause 19.

[6]        Legislation Act 2003, s. 12(1).

[7]        Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, August 2017, p. 38.

[8]        Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, p. 38.

[9]        This is the stated intent of the modified procedure: see EM, RBS Bill, p. 71.

[10]      Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, pp. 34, 39 (citation omitted).

[11]      Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, pp. 34,
39–40.

[12]      Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, pp. 36, 40.

[13]      Senator the Hon Mitch Fifield, Correspondence to the Senate Standing Committee for the Scrutiny of Bills dated 23 August 2017, p. 2.

[14]      CC Bill, Schedule 4, item 13.

[15]      The CC Bill would provide that the ACMA and ACCC may disclose relevant information to certain government agencies if the ACMA or ACCC is satisfied that the information will enable or assist that body to perform or exercise any of their functions or powers. The information that may be disclosed is limited to information obtained under, or for the purposes of, proposed division 8 or as part of the reporting obligations related to the assessment, collection and recovery of the RBS charge in proposed section 100.

[16]      EM, Acts and Instruments (Framework Reform) Bill 2014, p. 3.

[17]      Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, p. 36.

[18]      Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest, No. 8 of 2017, p. 36.

[19]      Senator the Hon Mitch Fifield, Correspondence to the Senate Standing Committee for the Scrutiny of Bills dated 23 August 2017, pp. 3–4.

[20]      Senator the Hon Mitch Fifield, Correspondence to the Senate Standing Committee for the Scrutiny of Bills dated 23 August 2017, p. 4.

[21]      Senate Standing Committee for the Scrutiny of Bills, Preliminary comments as at 28 August 2017, pp. 6–7.

Australian Greens' Dissenting Report

[1]        UN Human Rights Council, Report of the Special Rapporteur on the promotion and protection of the right to freedom of opinion and expression, at: http://www2.ohchr.org/english/bodies/hrcouncil/docs/17session/A.HRC.17.27_en.pdf

[2]        UN Human Rights Council, The promotion, protection and enjoyment of human rights on the Internet, at: https://documents-dds-ny.un.org/doc/UNDOC/LTD/G16/131/89/PDF/G1613189.pdf?OpenElement

[3]        Akamai, State of the Internet, at: https://www.akamai.com/us/en/about/our-thinking/state-of-the-internet-report

[4]        EY Sweeney, Digital Australia: State of the Nation, at: https://digitalaustralia.ey.com

[5]        Senate Select Committee on Environment and Communications, Report on Telecommunications Legislation Amendment (Access Regime and NBN Companies) Bill 2015, 22 February 2016, p. 26, at: https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/Telco_access_and_NBN_Bill/Report

[6]        Associate Professor Mark Gregory, Submission 14, p. 5.

[7]        TPG, Submission 2, p. 1.

[8]        TPG, Submission 2, p. 5.

[9]        OptiComm, Submission 11, p. 1.

[10]      Australian Government, Telecommunications Universal Service Obligation, Productivity Commission Inquiry Report, No. 83, 28 April 2017, p. 17.

[11]      Vertigan Review, NBN Market and Regulatory Report, 2014, p. 21.

[12]      OptiComm, Submission 11, p. 2.

[13]      Vocus Group, Submission 4, p. 2.

[14]      Vocus Group, Submission 4, p. 6.

[15]      TPG, Submission 2, p. 2.

[16]      Australian Government, Telecommunications Universal Service Obligation, Productivity Commission Inquiry Report, No. 83, 28 April 2017, p. 16–17.

[17]      Vocus Group, Submission 4, p. 2.

[18]      Vocus Group, Submission 4, p. 9.

[19]      TPG, Submission 2, p. 3.

[20]      Vodafone Hutchinson Australia, Submission 6, p. 1-2.

[21]      TPG, Submission 2, p. 9.

[22]      TPG, Submission 2, p. 8.