EXPLANATORY STATEMENTTelecommunications (Carrier Licence Charges) Act 1997
Determination under Paragraph 15(1)(b) No. 1 of 2019
Issued by the Australian Competition and Consumer Commission
Legislative Provisions
The Telecommunications (Carrier Licence Charges) Act 1997 (the Act) sets out the method for imposing annual charges in relation to the carrier licences held by telecommunications carriers under the Telecommunications Act 1997. Subsection 15(1) of the Act provides that the total of charges that are imposed on carrier licences in force at the beginning of a financial year must not exceed the sum of:
a) the amount determined, by a written instrument made by the Australian Communications and Media Authority (ACMA), to be the proportion of the ACMA's costs for the immediately preceding financial year that is attributable to the ACMA's telecommunications functions and powers; and
b) the amount determined, by a written instrument made by the Australian Competition and Consumer Commission (ACCC), to be the proportion of the ACCC's costs for the immediately preceding financial year that is attributable to the ACCC's telecommunications functions and powers; and
c) the amount determined, by a written instrument made by the ACMA, to be the proportion of the Commonwealth's contribution to the budget of the International Telecommunication Union for the calendar year in which the beginning of the financial year occurs that is to be recovered from carriers; and
(ca) the amount determined, by a written instrument made by the ACMA, to be the sum of the amounts paid under section 136C of the Telecommunications Act 1997 during the immediately preceding financial year; and
d) the amount determined, in a written instrument made by the Minister, to be the estimated total amount of grants likely to be made during the financial year under section 593 of the Telecommunications Act 1997.
Paragraph 15(4)(b) of the Act defines “cost” and provides that in relation to the ACCC, costs means an amount that, in accordance with accrual-based accounting principles, is treated as a cost of the ACCC. The ACCC’s costs for the 2017-18 financial year have been calculated in accordance with those principles.
A determination made under subsection 15(1) of the Act is a legislative instrument for the purposes of the Legislation Act 2003.
Purpose
The Determination has been made for the purposes of paragraph 15(1)(b) of the Act, and provides that $13,295,863 is the amount determined to be the proportion of costs for the 2017-18 financial year that is attributable to the ACCC’s telecommunications functions and powers. Of this amount, $1,531,854 relates to costs incurred on the ACCC’s Measuring Broadband Australia program.
Consultation
The ACMA, on behalf of the ACCC, conducted a public consultation in relation to the making of this Determination. The consultation period was open to carriers on 22 July 2019 for a four week period ending 19 August 2019. Two submissions were received relating to the ACCC which raised significant issues regarding the drafting of this instrument. Responses to these issues are published on the ACMA website in Attachment D of the Cost Recovery Implementation Statement: Annual Carrier Licence Charge for the charging period 1 July 2018 to 30 June 2019.
Overview
The Telecommunications (Carrier Licence Charges) Act 1997 was enacted by the Commonwealth Parliament to address the need for a structured and transparent method of imposing annual charges on telecommunications carrier licences. The primary objective of this Act is to ensure that the charges imposed on carrier licences do not exceed the costs attributable to the regulatory functions and powers related to telecommunications. This legislative framework was introduced to maintain a balance between the operational costs of regulatory bodies and the financial obligations of telecommunications carriers. The Act was designed to allow for the determination of these charges by relevant authorities, ensuring that the financial burden is both fair and reflective of the actual costs incurred in managing telecommunications regulations.
Scope and Application
The Telecommunications (Carrier Licence Charges) Act 1997 applies to telecommunications carriers who hold carrier licences under the Telecommunications Act 1997. It sets out the framework for imposing annual charges on these licences to recover costs associated with regulatory functions and powers in the telecommunications sector. These charges are calculated based on the costs incurred by the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC) in relation to their telecommunications functions and powers, as well as other specific costs and contributions. The Act's provisions ensure that the total charges imposed do not exceed the sum of these costs. The Determination under the Act for the 2017-18 financial year specifies that the ACCC's attributable costs amount to $13,295,863, with a portion of this related to the Measuring Broadband Australia program. This legislation applies nationally across Australia and is subject to adjustments through written instruments made by the ACMA and the ACCC, as well as the Minister, ensuring the charges reflect the most accurate and current cost data.
Key Provisions
The Telecommunications (Carrier Licence Charges) Act 1997 (the Act) is structured to delineate the method by which annual charges are imposed on carrier licences held by telecommunications carriers under the Telecommunications Act 1997. Specifically, subsection 15(1) of the Act sets out the criteria for these charges, ensuring that the total amount imposed does not exceed a specific sum. This sum includes the proportion of the Australian Communications and Media Authority's (ACMA) costs attributable to its telecommunications functions and powers (subsection 15(1)(a)), the proportion of the Australian Competition and Consumer Commission's (ACCC) costs for the same functions (subsection 15(1)(b)), the proportion of the Commonwealth's contribution to the budget of the International Telecommunication Union (subsection 15(1)(c)), amounts paid under section 136C of the Telecommunications Act 1997 (subsection 15(1)(ca)), and the estimated total amount of grants likely to be made under section 593 of the same Act (subsection 15(1)(d)). Paragraph 15(4)(b) further clarifies that costs, particularly for the ACCC, are defined in accordance with accrual-based accounting principles. The Explanatory Statement for the Determination under paragraph 15(1)(b) No. 1 of 2019, issued by the ACCC, specifies that the amount determined for the ACCC’s telecommunications functions and powers for the 2017-18 financial year is $13,295,863, with $1,531,854 relating to costs incurred on the ACCC’s Measuring Broadband Australia program.
Entities governed by the Act, particularly telecommunications carriers, are subject to a number of obligations and requirements. They must ensure that the annual charges imposed on their carrier licences comply with the limits set by the Act, specifically under subsection 15(1). The ACMA plays a crucial role in determining the proportion of costs attributable to its telecommunications functions, and the ACCC similarly determines its costs. Additionally, telecommunications carriers must be aware of the amounts determined by the ACMA in relation to the Commonwealth's contribution to the International Telecommunication Union and the amounts determined by the Minister for grants under section 593 of the Telecommunications Act 1997. Carriers must also be cognizant of any amounts paid under section 136C of the same Act, which may also form part of the annual charge calculation. Accurate accounting and adherence to the specified proportions and limits are paramount to avoid non-compliance.
Failure to comply with the provisions of the Act may lead to various civil and criminal consequences. The Act does not explicitly outline specific offences, penalties, or civil/criminal consequences for breach within the given text. However, in general terms, breaches of legislation can lead to enforcement actions by the ACMA or other regulatory authorities. Such actions might include fines, legal proceedings, or other penalties as prescribed by relevant laws. The severity of these consequences would depend on the nature and extent of the breach, and could potentially involve substantial financial penalties or other corrective measures to ensure compliance with the Act's requirements.