EXPLANATORY STATEMENT
Telecommunications (Carrier Licence Charges) Act 1997
Determination under Paragraph 15(1)(b) No. 1 of 2023
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 2020-21 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 $ 11,200,750 is the amount determined to be the proportion of costs for the 2020-21 financial year that is attributable to the ACCC’s telecommunications functions and powers. Of this amount, $1,640,116 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 16 December 2022 for a seven-week period ending 3 February 2023. No submissions were received relating to the ACCC.
Overview
The Telecommunications (Carrier Licence Charges) Act 1997 was enacted by the Commonwealth Parliament to establish a framework for the imposition of annual charges on carrier licences held by telecommunications carriers. This Act aims to ensure that the charges are proportionate to the costs incurred by the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC) in the execution of their respective telecommunications functions and powers. The Act sets out a method to calculate these charges to ensure they do not exceed the specified amounts, which are determined by written instruments made by the ACMA and the ACCC, among other factors.
In 2023, the ACCC, on behalf of the ACMA, issued a determination under paragraph 15(1)(b) of the Act, specifying that the amount determined to be the proportion of costs for the 2020-21 financial year attributable to the ACCC’s telecommunications functions and powers is $11,200,750. This determination was made following a public consultation period, although no submissions were received relating to the ACCC. The purpose of this determination is to comply with the requirements set out in the Act and to ensure the annual charges imposed on carrier licences do not exceed the allowable amounts.
Scope and Application
The Telecommunications (Carrier Licence Charges) Act 1997 applies to telecommunications carriers who hold a carrier licence under the Telecommunications Act 1997, encompassing various industries involved in telecommunications services within Australia. This Act is administered at the Commonwealth level, setting the framework for the imposition of annual charges on these carriers to cover certain costs associated with regulatory functions. These charges are limited to specific amounts determined by written instruments made by the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC) relating to their telecommunications functions and powers, among other specified elements. The Act does not explicitly state any exclusions or exemptions, but its application is contingent on the specified conditions outlined within the legislation. Additionally, the Act allows for the extension or restriction of its application through subordinate instruments, such as the recent determination which set the ACCC's attributable costs for the 2020-21 financial year at $11,200,750, inclusive of $1,640,116 for the Measuring Broadband Australia program.
Key Provisions
The Telecommunications (Carrier Licence Charges) Act 1997 (the Act) outlines the framework for imposing annual charges on carrier licences held by telecommunications carriers under the Telecommunications Act 1997. According to subsection 15(1) of the Act, the total charges for the financial year must not exceed a sum determined by written instruments from the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC). Specifically, these instruments determine the proportion of costs attributable to telecommunications functions and powers for the previous financial year, and any other specified amounts such as contributions to the International Telecommunication Union and grants under section 593 of the Telecommunications Act 1997. For the 2020-21 financial year, the Act mandates that the ACCC's costs for its telecommunications functions and powers are to be calculated under accrual-based accounting principles.
The Act imposes several obligations on the parties involved. The ACMA is tasked with determining the proportion of its costs related to telecommunications functions and powers, as well as the Commonwealth's contribution to the budget of the International Telecommunication Union. Similarly, the ACCC must determine its costs related to telecommunications functions and powers. The Minister, on the other hand, is required to estimate the total amount of grants likely to be made under section 593 of the Telecommunications Act 1997. These determinations are to be made in writing and in accordance with the Act’s provisions.
Failure to comply with the requirements set out in the Act may result in civil or criminal consequences. Although the specific penalties are not detailed in the Explanatory Statement, breaches of legislative instruments typically attract fines or other penalties as prescribed by law. The severity of the penalty often depends on the nature and extent of the breach, with maximum penalties specified in relevant sections of the Act or other applicable legislation. Non-compliance may also lead to legal action, where the aggrieved party may seek redress through the courts.