EXPLANATORY STATEMENT
Telecommunications (Carrier Licence Charges) Act 1997
Determination under Paragraph 15(1)(b) No. 1 of 2005
Issued by the authority of the Australian Competition & Consumer Commission (‘ACCC’)
The Telecommunications (Carrier Licence Charges) Act 1997 (the Act) sets out the method of calculating annual charges that apply to the carrier licences held by the telecommunications carriers. Subsection 15(1) of the Act states 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 ACA, to be the proportion of the ACA's costs for the immediately preceding financial year that is attributable to the ACA's telecommunications functions and powers; and
b) the amount determined, by a written instrument made by the 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 ACA, 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
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; and
e) the amount determined by the Industry Minister, by written instrument, to be the proportion of the Commonwealth's costs for the immediately preceding financial year that is attributable to the administration of Part 2 of Schedule 1 to the Telecommunications Act 1997.
The accompanying determination has been made for the purposes of paragraph 15(1)(b) of the Act. The determination provides that $6,433,348 is the amount determined to be the proportion of ACCC’s cost for the 2003-04 financial year that is attributable to the ACCC’s telecommunications functions and powers.
Paragraph 15 (4)(b) of the Act requires that the ACCC’s costs are to be calculated in accordance with accrual-based accounting principles. This amount has been calculated in accordance with those principles.
Subsection 15(2) of the Act provides that an instrument under subsection (1) must be notified in the Gazette before the day on which the charges referred to in subsection (1) becomes due for payment. Section 56 (1) of the Legislative Instruments Act 2003 states that a requirement to publish an instrument in the gazette is satisfied if the instrument is registered on the Federal Register of Legislative Instruments (‘FRLI’). The accompanying determination will therefore be published on FRLI, and will be tabled in Parliament and is subject to Parliamentary disallowance.
Overview
The Telecommunications (Carrier Licence Charges) Act 1997 was enacted to address the need for a structured approach to calculating annual charges on carrier licences held by telecommunications carriers in Australia. This Act was introduced to ensure transparency and fairness in the imposition of charges on telecommunications carriers. It was enacted by the Commonwealth Parliament, aiming to clearly define the basis on which annual charges are levied and to ensure that these charges do not exceed a predetermined sum based on the costs of the relevant authorities and other specified factors. The accompanying determination under paragraph 15(1)(b) specifies that the amount attributable to the Australian Competition and Consumer Commission's (ACCC) telecommunications functions and powers for the 2003-04 financial year is $6,433,348, calculated in accordance with accrual-based accounting principles as required by the Act. This determination is intended to inform the calculation of total charges for the financial year and is subject to notification and disallowance procedures.
Scope and Application
The Telecommunications (Carrier Licence Charges) Act 1997 applies to telecommunications carriers that hold a carrier licence under the Telecommunications Act 1997. The Act governs the calculation of annual charges imposed on these licences, ensuring that the total charges do not exceed specific proportions of the costs attributable to the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC) for their telecommunications functions and powers, as well as other specified costs. The Act is of Commonwealth jurisdiction and applies across Australia. The determination made under this Act specifies the proportion of ACCC's costs for a particular financial year attributable to its telecommunications functions, calculated in accordance with accrual-based accounting principles. This determination is subject to notification in the Gazette and registration on the Federal Register of Legislative Instruments, and it is subject to disallowance by Parliament. The Act does not explicitly state exclusions or thresholds but operates within the bounds of its specified cost calculations and regulatory framework.
Key Provisions
The Telecommunications (Carrier Licence Charges) Act 1997 (the Act) outlines the method for calculating annual charges applicable to carrier licences held by telecommunications carriers. Under section 15(1), the total charges for a financial year must not exceed specific amounts determined by various authorities. These amounts include the proportion of the Australian Communications Authority's (ACA) costs attributable to telecommunications functions, the proportion of the Australian Competition and Consumer Commission's (ACCC) costs for the preceding financial year attributable to telecommunications functions, the proportion of the Commonwealth's contribution to the International Telecommunication Union's budget to be recovered from carriers, the estimated total amount of grants to be made under the Telecommunications Act 1997, and the proportion of the Commonwealth's costs for the preceding financial year attributable to the administration of Part 2 of Schedule 1 to the Telecommunications Act 1997.
The obligations imposed by the Act on telecommunications carriers are primarily financial. Carriers must ensure that the charges they incur for their licences do not exceed the amounts determined by the ACA, ACCC, the Minister, and the Industry Minister, as specified under section 15(1). The determinations for these amounts are to be made in accordance with accrual-based accounting principles, as required by section 15(4)(b) for the ACCC’s costs. Furthermore, section 15(2) mandates that any instrument determining these charges must be notified in the Gazette before the charges become due. Additionally, in line with section 56(1) of the Legislative Instruments Act 2003, these determinations must be registered on the Federal Register of Legislative Instruments (FRLI), tabled in Parliament, and are subject to Parliamentary disallowance.
Breaches of the Act’s provisions regarding the calculation and imposition of carrier licence charges could result in various legal consequences. If the charges imposed exceed the amounts determined by the relevant authorities, telecommunications carriers could face penalties. However, the Act itself does not specify the exact nature of these penalties or the enforcement mechanisms. The primary legal consequence is that carriers must adhere to the determined amounts to avoid overcharging, which could lead to rectification measures or financial penalties imposed by the courts or regulatory bodies. Additionally, the failure to comply with the notification requirements in the Gazette or the registration on the FRLI could result in the determination being subject to disallowance by Parliament, leading to further scrutiny and potential amendments to the Act.