NBN review panel asks why ACCC regulates telecom
- 14 February, 2014 10:02
Credit: University of Sydney
An NBN review panel has asked whether economic regulation of telecom should continue to be handled by the Australian Competition and Consumer Commission (ACCC).
The panel was appointed by the Australian government to do a cost-benefit analysis and regulatory review of the National Broadband Network has invited comments from industry and the public.
In a framing paper released this week, the NBN review panel said it wanted input on how the industry should be structured and what regulatory settings should be in place after the NBN is rolled out. Submissions are due on 14 March.
“This is the start of the panel’s consultation processes and we have deliberately begun at a high-level to guide our thinking on a framework that will promote access to fast broadband,” said the panel’s chair, Michael Vertigan.
Among the questions, the panel asked whether it makes sense to keep the ACCC in charge.
“Australia is unusual in vesting responsibility for economic regulation of telecommunications in a generalist body whose responsibilities include administration of the competition laws,” the panel said.
“Originally, the decision to transfer those powers to the ACCC was based on the view that telecommunications-specific provisions would merge over time into the national access regime established under Part IIIA of then Trade Practices Act. However, no such confluence has occurred nor seems likely to occur, though it may well be that some aspects of the current telecommunications provisions will eventually be substantially streamlined.”
The ACCC declined to comment.
The ACCC regulates telecom price and competition issues while the Australian Communications and Media Authority (ACMA) governs compliance and other more technical communications issues.
The NBN review panel is expected to provide a final report to the government in June.
The panel is still developing its methodology for cost-benefit analysis of the availability of broadband using different technologies, and will release this when it’s ready, according to the Department of Communications.
Also, the panel plans to issues “one or more other papers” on more specific matters during the review, Vertigan said.
The Coalition government appointed members to the panel on 12 December.
Vertigan is currently a director of Aurora Energy, the power company that has proposed stringing fibre over powerlines in Tasmania. The NBN review panel also includes former eBay ANZ CEO Alison Deans, former Australian Communications Authorty CEO Tony Shaw, and Henry Ergas, a former OECD economist and known Labor critic.
In the framing paper, the panel outlined what it see as the main challenges of its task:
In approaching its task, the panel is conscious that issues of market structure are not simply questions of regulatory approach but are fundamentally affected by the economics underpinning the market and by the decisions of participants in the market. That said, the role of NBN Co in the market is itself a key determinant of the future market structure, as is the role of established participants and new entrants. So while the future form of regulation will influence market structure, market structure will also influence regulation.
The panel is also aware that the questions around market structure and regulation are being considered in the context of existing markets and regulation – there is no clean slate, nor is it realistic (or necessarily desirable) to envisage merely turning back the clock. But these structural questions are fundamentally important to the long term operation of the telecommunications industry, to end-users and, more broadly, to Australia’s future prosperity.
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