EXPLANATORY STATEMENT
Telecommunications (Carrier Licence Charges) Act 1997
Determination under Paragraph 15(1)(b) No. 1 of 2021
Issued by the Australian Competition & 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 2018-19 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 $11,878,541 is the amount determined to be the proportion of costs for the 2018-19 financial year that is attributable to the ACCC’s telecommunications functions and powers. Of this amount, $1,702,406 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 13 April 2021 for a four week period ending 11 May 2021. Two submissions were received relating to the ACCC which raised 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 2019 to 30 June 2020.
Overview
The Telecommunications (Carrier Licence Charges) Act 1997 was enacted to establish a structured method for imposing annual charges on carrier licences held by telecommunications carriers. This was intended to address the need for a systematic approach to funding the regulatory functions and powers of the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC) in the telecommunications sector. The Act was enacted by the Parliament of Australia, with the aim of ensuring that the costs associated with regulating the telecommunications industry are adequately covered by charges imposed on the carriers. This legislation provides a transparent and fair method for determining the charges based on the costs attributable to telecommunications functions and powers of the relevant authorities. The Explanatory Statement details a recent determination by the Australian Competition and Consumer Commission in 2021, which calculated the proportion of the ACCC's costs for the 2018-19 financial year attributable to its telecommunications functions and powers. This determination was made in accordance with the requirements of the Act and followed a public consultation process.
Scope and Application
The Telecommunications (Carrier Licence Charges) Act 1997 applies to telecommunications carriers who hold a carrier licence under the Telecommunications Act 1997, imposing annual charges based on the proportion of certain costs attributed to telecommunications functions and powers. The Act sets out a method for determining these charges, ensuring that the total amount imposed on carrier licences does not exceed specific proportions of the Australian Communications and Media Authority's (ACMA) and the Australian Competition and Consumer Commission's (ACCC) costs, along with other specified costs. This legislation is of Commonwealth reach and extends its application through subordinate instruments made by the ACMA and ACCC under the Act. The Determination under paragraph 15(1)(b) No. 1 of 2021 specifies the amount of $11,878,541 as the proportion of the ACCC's costs attributable to its telecommunications functions and powers for the 2018-19 financial year, including costs related to the Measuring Broadband Australia program.
Key Provisions
The Telecommunications (Carrier Licence Charges) Act 1997 (the Act) specifies how annual charges are imposed on carrier licences held by telecommunications carriers. Section 15(1) of the Act requires that the total charges for a financial year cannot exceed the sum of several components: (a) the proportion of the Australian Communications and Media Authority’s (ACMA) costs related to its telecommunications functions, determined by a written instrument made by the ACMA; (b) the proportion of the Australian Competition and Consumer Commission’s (ACCC) costs related to its telecommunications functions, determined by a written instrument made by the ACCC; (c) the proportion of the Commonwealth's contribution to the International Telecommunication Union budget, determined by a written instrument made by the ACMA; (ca) the sum of the amounts paid under section 136C of the Telecommunications Act 1997 during the preceding financial year; and (d) the estimated total amount of grants under section 593 of the Telecommunications Act 1997, determined by the Minister. Paragraph 15(4)(b) clarifies that 'cost' means an amount treated as a cost under accrual-based accounting principles.
The parties governed by the Act have specific obligations to ensure compliance with the legislative provisions. The ACMA must determine the proportion of its costs attributable to telecommunications functions and powers and communicate this through a written instrument. Similarly, the ACCC is required to determine its costs related to telecommunications and communicate this through a written instrument. Both the ACMA and the Minister must also determine the Commonwealth's contribution to the International Telecommunication Union budget and the estimated total amount of grants, respectively, and communicate these through written instruments. Carriers holding licences must pay the annual charges imposed in accordance with these determinations.
Breaches of the Act can lead to civil and criminal consequences. While specific offences and penalties are not detailed in the provided text, it is implied that non-compliance with the charge imposition and payment obligations could result in legal action. The text does not provide explicit details on penalties, but such breaches could lead to fines, legal proceedings, or other enforcement actions as prescribed by relevant laws. It is essential for all parties to adhere to the determinations and obligations to avoid any legal repercussions.