EXPLANATORY STATEMENT
Issued by the Australian Communications and Media Authority
Radiocommunications Act 1992
Radiocommunications (Spectrum Access Charges – 2.3 GHz Band) Determination 2014
Purpose
The purpose of the Radiocommunications (Spectrum Access Charges – 2.3 GHz Band) Determination 2014 (the Determination) is to fix spectrum access charges payable by Telstra Corporation Limited for the re-issue of some of its expiring spectrum licences in the 2.3 GHz band (2302 MHz – 2400 MHz).
Legislative provisions
Subsection 82(1) of the Radiocommunications Act 1992 (the Act) allows the Australian Communications and Media Authority (the ACMA) to re-issue a spectrum licence to the person to whom it was previously issued if the licence was used in the provision of a service included in a class of services specified in a determination under subsection 82(3) of the Act.
Subsection 82(3) of the Act provides for the Minister to determine, by written instrument, a specified class of services for which re-issuing spectrum licences to the same licensees would be in the public interest.
Subsection 294(1) of the Act provides that the ACMA may make determinations to fix spectrum access charges payable by licensees for issuing (and re-issuing) spectrum licences and to specify the times when spectrum access charges are payable.
Subsection 294(2) of the Act provides for the Minister to give written directions to the ACMA about the matters dealt with in such determinations.
Background
In July 2000, a number of Multipoint Distribution Station (MDS) licences for the 2.3 GHz band were converted to spectrum licences. These spectrum licences will expire on 24 July 2015.
Under subsection 82(1) of the Act, the ACMA may re-issue licences to the same licensees without undertaking a price-based allocation process, if:
- the licence was used in the provision of a service included in the class of services specified in a determination made under subsection 82(3) of the Act; or
- the ACMA is satisfied that special circumstances exist as a result of which it is in the public interest for the existing licensee to continue to hold the licence.
On 9 February 2012, the then Minister for Broadband, Communications and the Digital Economy made the Radiocommunications (Class of Services) Determination 2012 under subsection 82(3) of the Act. In that determination, the Minister specified several classes of services for which re-issuing spectrum licences to the same licensees would be in the public interest. The classes of services include wireless broadband services in the 2.3 GHz band.
Based on the ACMA’s analysis of available evidence of use of the licence in the provision of a service, the 2.3 GHz band licences specified in the Determination are able to be re-issued. In considering whether to reissue the relevant licences under paragraph 82(1)(a) of the Act, the ACMA consulted with the existing licensees and relied upon information provided, including:
- the number of registered and deployed devices under each relevant licence;
- maps detailing the cumulative coverage area of the services offered by the licensees;
- information on the types of equipment and technology deployed; and
- links to promotional material regarding relevant services provided by the licensees.
On 9 February 2012 the Minister also made, under subsection 294(2) of the Act, the Radiocommunications (Spectrum Access Charges) Direction 2012 (the Pricing Direction). The Pricing Direction specifies the amount that the Minister considered to be the value of the spectrum in relation to the spectrum bands specified, and directs the ACMA to ensure that the spectrum access charges for re-issued licences reflect that amount.
The Pricing Direction defines a formula for fixing the spectrum access charge payable by a licensee in relation to a re-issued spectrum licence. The formula is based on a “$/MHz/Pop” calculation where:
- $ = Australian dollars;
- MHz = the bandwidth of spectrum authorised for use in the relevant licence area; and
- Pop = the population of the licence area, to be determined by the ACMA at the time the ACMA determines the spectrum access charges under subsection 294(1) of the Act having regard to the available population data at that time.
The amount set by the Pricing Direction for licences in the 2.3 GHz band is $0.03/MHz/Pop. In compliance with the Pricing Direction, the amount of spectrum access charge payable for the re-issue of Telstra Corporation Limited spectrum licences specified in the Determination is calculated by multiplying the value of the spectrum in relation to the 2.3 GHz band by the population of each licence area specified in the spectrum licence (as determined by section 4 of the Determination) by the bandwidth of spectrum authorised for use by the licensee under the licence.
Consultation
The ACMA sought comment from Telstra Corporation Limited about matters pertaining to the calculation of the spectrum access charges, the amounts of the spectrum access charges for each of the licences and the payment date. The comments received by the ACMA were considered in the making of the Determination.
Regulation impact
The ACMA has consulted with the Office of Best Practice Regulation (the OBPR) on the requirement for a Regulation Impact Statement (RIS). The OBPR advised that the Determination does not warrant the preparation of a RIS because it is likely to have only minor and machinery impacts. The reference number for the OBPR’s assessment is 16044.
Detailed description of the Determination
Details of the provisions of the Determination are set out in Attachment A.
Statement of compatibility with human rights
In accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011, the ACMA has prepared a Statement of Compatibility with Human Rights to consider the human rights implications of the Determination. The Statement, set out in Attachment B, concludes that the Determination does not raise any human rights issues.
ATTACHMENT A
DETAILS OF THE RADIOCOMMUNICATIONS (SPECTRUM ACCESS CHARGES – 2.3 GHz BAND) DETERMINATION 2014
Section 1 – Name of Determination
This section names the Determination the Radiocommunications (Spectrum Access Charges – 2.3 GHz Band) Determination 2014.
Section 2 - Commencement
This section provides that the Determination will commence on the day after it is registered.
Section 3 – Definitions
This section defines the terms used in the Determination.
Section 4 - Population of a licence area for a spectrum licence
This section provides that the population estimate for a licence area of a spectrum licence, mentioned in column 1 of the table in section 5, is the corresponding number in column 2 of the table.
The ACMA is required to determine a population estimate for each licence area of a spectrum licence at the time the Determination is made.
The ACMA first derives an estimated population count for each licence area which is consistent with the population count and dispersion enumerated in Census 2011.[1] To comply with the Pricing Direction the ACMA has considered how population numbers have grown across the intervening period (i.e. between the most recent available Census and a time proximate to the making of the Determination).
The ratio of the projected national resident population at June 2014 to the Census 2011 national population count provides an indicator of how population has grown across this intervening period.[2] This ratio is then applied to the estimate of population in each licence area at August 2011 to derive an estimate of population in the licence area as at June 2014.
A worked example of the population calculation for a particular licence area is provided in the following table along with source details:
The unit amounts applied by the ACMA in calculating the spectrum access charges payable by Telstra Corporation Limited in the 2.3 GHz band are $0.03/MHz/Pop which is the value of the spectrum in Australian dollars for the re-issue of a spectrum licence for a period of 15 years.
Section 5 - Spectrum access charge payable by Telstra Corporation Limited
This section provides the amount of spectrum access charge payable by Telstra Corporation Limited for the re-issue of the relevant spectrum licences.
Section 6 – When spectrum access charge is payable
This section provides the date that payment is required for spectrum access charges. The ACMA has determined that full payment of the spectrum access charge for each licence to be re-issued is to be made on or before 18 December 2014.
Section 7 – Expiry
This section provides that the Determination ceases to have effect at the end of 24 July 2015 when the current licences expire.
ATTACHMENT B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Radiocommunications (Spectrum Access Charges – 2.3 GHz Band) Determination 2014.
This legislative instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
The Radiocommunications (Spectrum Access Charges – 2.3 GHz Band) Determination 2014 (the Determination) fixes spectrum access charges payable by licensees for the re-issue of certain expiring spectrum licences in the 2.3 GHz band.
Human Rights Implications
The Determination does not engage any of the applicable rights or freedoms.
Conclusion
The Determination is compatible with human rights as it does not raise any human rights issues.
[1] Australian Bureau of Statistics, Census 2011, Basic Community, Aboriginal and Torres Strait Islander Peoples (Indigenous) and Time Series Profiles (catalogue number 2069.0.30.008).
[2] This is based on information from the Australian Bureau of Statistics, Census 2011, Basic Community, Aboriginal and Torres Strait Islander Peoples (Indigenous) and Time Series Profiles (catalogue number 2069.0.30.008), the Australian Bureau of Statistics, Australian Demographic Statistics, December 2013, catalogue 3101.0, released 19 June 2014 and the Budget Paper No 3, Australia’s Federal Relations 2014-15; 13 May 2014, page 107.