NBN legislative framework
The regulatory framework for the National Broadband Network (NBN) is established through the National Broadband Network Companies Act 2011 (NBN Companies Act) and the Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Act 2011 (NBN Access Act) which add to the existing generic telecommunications regulatory framework.
The Acts were passed by the Parliament on 28 March 2011 and received royal assent on 12 April. All of the provisions are now operational.
National Broadband Network Companies Act 2011
- Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Act 2011
Explanatory Memoranda for the legislation are provided on the Acts' respective bill pages, located on the Parliament of Australia website.
- National Broadband Network Companies Bill 2011
- Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2011
The Acts set out in legislation the Australian Government's policy commitment that the NBN will operate on a transparent, wholesale-only, open and non-discriminatory access basis subject to oversight by the Australian Competition and Consumer Commission (ACCC). This will provide a platform for innovation and robust retail competition in the Australian telecommunications market. The Acts also include a number of measures to support the rollout of the NBN.
The government consulted widely in developing the legislation and the Acts take into account feedback received on exposure drafts of the legislation and submissions made to the Senate Legislation Committee, as well as a number of recommendations made by the Implementation Study.
NBN Companies Act
The NBN Companies Act sets out key obligations that limit NBN Co Limited to, and focus it on, wholesale-only telecommunications.
Amongst other things, the Act:
- limits NBN Co to operating as a wholesale-only telecommunications company in terms of the services and goods it supplies, as well as the investments it makes
- limits NBN Co to supplying carriers, services providers and utilities, in which case services must be used for internal purposes only
- establishes powers for functional separation of NBN Co and for the government to require NBN Co to transfer or divest assets
- provides for the making of licence conditions about services that NBN Co can and cannot supply
- enables the making of regulations to set limits on private control of NBN Co if it is no longer wholly Commonwealth-owned
- establishes a process for the eventual sale of NBN Co
- establishes reporting obligations on NBN Co which would apply if it is no longer wholly Commonwealth-owned
- provides for exemptions from State and Territory stamp duty for transactions associated with the Definitive Agreements between Telstra and NBN Co
- provides that there must be a review, before 12 April 2012, of the operation of the Freedom of Information Act 1982 (FOI Act) so far as that Act relates to documents of NBN Co.
The NBN Companies Act states that the Australian Government must retain full ownership of NBN Co until the NBN rollout is complete. This will give the government greater flexibility to pursue its objectives in the roll out of the network.
The sale of NBN Co will be subject to:
- the Communications minister making a declaration that the NBN is built and fully operational
- the Productivity Commission conducting an inquiry into and reporting on regulatory, budgetary, consumer and competition matters relating to the NBN
- a Parliamentary Joint Committee considering the findings of that report
- the Finance minister making a disallowable declaration that conditions are suitable to sell NBN Co
- parliament not disallowing that declaration.
NBN Access Act
The NBN Access Act amends the Competition and Consumer Act 2010 (CCA), the Telecommunications Act 1997 (Tel Act) and the FOI Act to provide a regulatory framework for the NBN appropriate to its unique role.
Open and non-discriminatory access
NBN Co is subject to supply, equivalence and transparency obligations that will ensure it can provide a robust platform for innovation and vigorous retail competition. NBN Co's access arrangements are based on the telecommunications access regime that is already in place under the CCA, meaning that the ACCC will have powers to make access determinations and binding rules of conduct in relation to NBN Co's supply of services.
Under the amendments to the CCA:
- all services provided by NBN Co are 'declared' and therefore subject to supply and non-discrimination requirements and oversight from the ACCC
- specific Standard Access Obligations apply to NBN Co that reflect its wholesale-only status
- NBN Co must publish all its service offers, to ensure there is full transparency of its terms and conditions of supply
- NBN Co must provide the ACCC with the details of access agreements that contain different terms from its published offers, and the ACCC must maintain a register of the statements of differences on its website
- NBN Co must not to discriminate in the supply of services, or in activities related to the supply of services—the only exemptions from this requirement are based on creditworthiness and failure to comply with NBN Co's terms and conditions.
The ACCC must publish guidance on NBN Co's non-discrimination obligations. This process commenced in December 2011 with the release of the ACCC's draft guidelines.
- Register of NBN Access Agreement Statements (AAS) (s. 152BEBD)
- ACCC explanatory material on the Part XIC non-discrimination provisions
Under the legislation, NBN Co can choose to publish a standard form of access agreement (SFAA) and/or give a special access undertaking (SAU) to the ACCC in relation to its terms and conditions for the supply of wholesale services. In November 2011 NBN Co published its Wholesale Broadband Agreement (WBA), as its SFAA. In December 2011, it lodged a SAU with the ACCC for consideration.
The NBN Access Act also authorises, for the purposes of the CCA, certain conduct by NBN Co that is reasonably necessary for it to achieve uniform national wholesale pricing. This conduct relates to interconnection other than at listed points of interconnection, the bundling of services and cross-subsidising in charging for services. These authorisations are subject to review. In addition, the requirement for both NBN Co and the ACCC to agree to any change to the list of points of interconnection expires when the NBN is built and fully operational.
Level playing field requirements
Under the amendments to the Tel Act, and further amendments to the CCA, new level playing field rules were introduced to support NBN Co in delivering its national objectives and provide NBN-consistent outcomes across new networks, regardless of who operates them. To give industry time to adjust, the level playing field requirements commenced 12 months after the NBN Access Act received royal assent but they are now operational.
The rules apply to a fixed-line local access network or a part of such a network that is built, upgraded, altered or extended after 1 January 2011 so that it is capable of providing a carriage service where the download transmission speed is normally more than 25 megabits per second to residential or small business users. The effect of the rules is that such networks must be wholesale-only, and that the operator of such networks must supply a Layer 2 bitstream service on a non-discriminatory basis.
Under the Tel Act, the Australian Communications and Media Authority (ACMA) has the power to make a layer 2 bitstream standard. Under the CCA, the ACCC is required to declare a layer 2 bitstream service. The ACCC declared this service, called the local bitstream access service (LBAS), in February 2012 in anticipation of the level playing field rules commencing in April 2012. The ACCC has also been consulting on an access determination for the service.
- ACCC: Local bitstream access service declaration
- ACCC: Access determination for the local bitstream access service
The LBAS is the service that carriers are required to supply if they are subject to the level playing field provisions.
There are some statutory exemptions from these provisions, and also powers for the minister to exempt specific local access lines, networks or network owners.
Provision is also made to simplify the making of industry codes and standards for fibre infrastructure and services under Part 6 of the Tel Act. Such standards, if made, could ensure new fibre to the premises networks are built consistent with NBN technical specifications.
Further details are on the level playing field arrangements and exemptions page.
Freedom of information
The amendments to the FOI Act ensure that NBN Co is a prescribed authority for the purposes of that Act, with an exemption in relation to documents in respect of its commercial activities. This provision commenced on 13 June 2011.
On 16 April 2012, the Attorney-General announced a statutory review of the application of Freedom of Information to NBN Co. The terms of reference for the review are available from the website of the Attorney-General’s Department.
