EXPLANATORY STATEMENT
Issued by the authority of the Minister for Broadband, Communications
and the Digital Economy
Telecommunications Act 1997
Telecommunications (Carrier Licence Exemption) Determination 2012 (No. 1)
Authority
Paragraph 51(1)(c) of the Telecommunications Act 1997 (the Act) enables the Minister to determine that section 42 of the Act does not apply in relation to a specified use of a network unit.
Section 42 of the Act establishes a basic prohibition on the use of network units to supply carriage services to the public without a carrier licence or a nominated carrier declaration (which enables a nominated telecommunications carrier to assume the responsibilities imposed on another telecommunications carrier in relation to specified network units).
Purpose
The purpose of the Telecommunications (Carrier Licence Exemption) Determination 2012 (No. 1) (the Determination) is to exempt specified uses of network units owned by QR National, Queensland Rail, Queensland Treasury Holdings (QTH), and any related bodies corporate (‘the rail-related group of companies’), or Powerlink, from the licensing requirements of section 42 of the Act. This exemption is considered necessary as subjecting the rail-related group of companies and Powerlink to carrier licence obligations would not contribute to achieving the objectives of the Act.
In reliance of subsection 33(3) of the Acts Interpretation Act 1901, the Determination revokes the Telecommunications (Carrier Licence Exemption) Determination 2009 (No. 1) (the 2009 Determination) which served a similar purpose. The 2009 Determination was rendered ineffective as a result of changes to the corporate structure of the rail-related group of companies.
The exemptions enable Powerlink and the rail-related group of companies to continue the practice of sharing communications network infrastructure for the purpose of carrying on their respective electricity transmission and railway businesses. It eliminates the need to duplicate costly infrastructure, improves the management and safety of rail and electricity assets and results in financial benefits for the entities involved, and their customers.
Background
The Minister made the 2009 Determination following the corporatisation of the rail service provider, QR Limited, and Powerlink which removed the prior legal right of both state-owned entities to share network services under the ‘immediate circle’ provisions of section 23 of the Act.
In making the 2009 Determination, the Minister considered that it was appropriate for the sharing of infrastructure to continue unhindered post-corporatisation, as it would not adversely affect the long-term interests of end-users to grant such an exemption, nor would such an exemption have anti-competitive effects on the supply of telecommunications services in Queensland.
In 2010, QR Limited was restructured into Queensland Passenger (which is now known as ‘Queensland Rail’) and QR National. The key functions of these companies can be described as follows:
- Queensland Rail operates passenger rail services and fixed rail infrastructure, including network units, throughout Queensland.
- QR National and its related bodies corporate own and operate freight rail services throughout Australia and operate fixed rail infrastructure, including network units, leased from Queensland Rail and Queensland Treasury Holdings (QTH). QR National also owns some network units.
As part of the restructure, network units previously owned by QR Limited and its subsidiaries were divided amongst QR National, Queensland Rail and QTH. The restructure has resulted in the requirement for the Minister to make this Determination to reflect the new arrangements. Most of the network units operated by QR National or its subsidiaries are owned by QTH. These network units are leased by QTH to QR Network (a subsidiary of QR National) pursuant to a lease agreement between the parties. The Determination intends to capture leasing agreements that permit use of network units for the purposes of section 42 of the Act.
Powerlink is a Queensland government owned corporation that owns, develops, operates and maintains Queensland’s high-voltage electricity transmission network.
Powerlink, Queensland Rail and QR National operate backhaul fibre optic cable networks that are principally used for communications purposes associated with conducting their respective businesses. However, these companies also use each other’s network units for the purposes of their respective businesses. Examples of uses include:
- undertaking monitoring of electricity load and capacity requirements;
- rail signalling; and
- communications for train services.
This shared use removes the need to duplicate costly infrastructure and allows the entities to operate in a cost-effective manner. This cross-utilisation of infrastructure is limited to infrastructure located in Queensland.
In granting this Determination, the Minister has taken into consideration:
- the views of the Australian Communications and Media Authority (ACMA);
- competition and economic effects;
- the impact of not imposing carrier licensing obligations on a particular network unit, or owner or use of network unit, including revenue losses to the Australian Government and universal service obligation contributions;
- regulatory compliance costs.
The carrier licence exemption is considered appropriate in the current circumstances because the reasons for granting the 2009 Determination have not altered in any significant respect and it does not harm the long-term interests of end-users to make this exemption.
The Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003 (Cth) (LIA).
Consultation
The Department consulted with the ACMA, Powerlink and the rail-related group of companies in the development of this Determination. Further consultation was considered unnecessary because the substantive changes from the 2009 Determination are of a minor or machinery nature only, and the making of the Determination does not alter existing arrangements (see paragraph 18(2)(a) of the LIA).
Details of the accompanying Determination are set out in the Attachment.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Telecommunications (Carrier Licence Exemption) Determination 2012 (No. 1)
This Determination 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 Determination
Paragraph 51(1)(c) of the Telecommunications Act 1997 (the Act) enables the Minister to determine that the carrier licensing obligations under section 42 of that Act do not apply in relation to a specified use of a network unit.
The Telecommunications (Carrier Licence Exemption) Determination 2012 (No. 1) (the Determination) exempts specified uses of network units owned by QR National, Queensland Rail and Queensland Treasury Holdings (or any related bodies corporate – collectively ‘the rail-related group of companies’), or Powerlink from the scope of section 42. The specified uses relate to the supply of carriage services for the workings of train services and electricity.
The Determination is in substantially the same terms as the Telecommunications (Carrier Licence Exemption) Determination 2009 (No. 1) (the 2009 Determination), which is no longer effective due to changes to the corporate structures of the rail-related group of companies. The 2009 Determination is revoked by this Determination.
The Determination is intended to eliminate the need for duplicating infrastructure and to improve the management and safety of rail and electricity assets, as the carrier licensing obligations are not considered appropriate. The specified exempt uses of network units provide regulatory certainty and do not raise any human rights issues.
Human rights implications
This Determination does not engage any of the applicable rights or freedoms.
Conclusion
This Determination is compatible with human rights as it does not raise any human rights issues.
ATTACHMENT
Details of the Telecommunications (Carrier Licence Determination) 2012 (No. 1)
Clause 1 – Name of the Determination
Clause 1 of the Determination provides that the name of the Determination is the Telecommunications (Carrier Licence Determination) 2012 (No. 1).
Clause 2 – Commencement
Clause 2 provides that the Determination commences on the day after it is registered on the Federal Register of Legislative Instruments.
Clause 3 – Revocation
Clause 3 provides for the revocation of the Telecommunications (Carrier Licence Exemption) Determination 2009 (No. 1).This is necessary because of the restructure of the network units previously owned by QR Limited. The revocation is made in accordance with subsection 33(3) of the Acts Interpretation Act 1901 (Cth) and paragraph 51(1)(c) of the Telecommunications Act 1997 (Cth).
Clause 4 – Definitions
Clause 4 establishes the key definitions used in the Determination.
The term Act is defined by reference to the Telecommunications Act 1997 (Cth).
The term Designated Communications Infrastructure is defined by reference to telecommunications infrastructure owned by the rail-related group of companies located in Queensland.
The term Permitted Electricity-related Services is defined by reference to carriage services provided to Powerlink, necessary or desirable for managing the generation, transmission, distribution or supply of electricity or the charging for the supply of electricity.
The term Permitted Rail-related Services is defined by reference to carriage services to any one or more of QR National, Queensland Rail or any of their related bodies corporate where such services are necessary or desirable for the workings of train services. QTH is not included in this definition as it does not operate train services and therefore does not require the use of carriage services provided by Powerlink.
The term Powerlink Communications Infrastructure is defined by reference to telecommunications infrastructure owned by Powerlink. Powerlink does not conduct operations interstate and accordingly, does not own any communications networks outside the State of Queensland. As such, this term is limited to telecommunications infrastructure within Queensland only.
Powerlink, QR National, QTH and Queensland Rail are identified by the legislation under which each is constituted and the respective Australian Company Number (ACN) of each company. Where applicable, the related trading name is also included.
The term related body corporate is defined as having the same meaning given under section 50 of the Corporations Act 2001 (Cth).
To aid the reader, a note is inserted at the end of the clause identifying that the term carriage service has the same meaning as in section 7 of the Act.
Clause 5 – Exemption: Designated Communications Infrastructure
Clause 5 provides an exemption to the rail-related group of companies from the requirements of section 42 of the Act. It enables the rail-related group of companies to supply certain electricity-related carriage services to Powerlink.
Clause 6 – Exemption: Powerlink Communication Infrastructure
Clause 6 provides an exemption to Powerlink from the requirements of section 42 of the Act. The exemption enables Powerlink to supply the permitted rail-related carriage services to the rail-related group of companies.
Clause 7 – Cessation
Clause 7 provides that the Determination will cease on 1 July 2021. This date allows the rail-related group of companies and Powerlink to manage their investment cycles while providing certainty as to the date of cessation.
This cessation date will arise sooner than the date which would have applied as a result of the application of the sunsetting arrangements under subsection 50(2) of the Legislative Instruments Act 2003.