EXPLANATORY STATEMENT
Telecommunications (Costs Attributable To Telecommunications Functions and Powers) Determination 2006
Telecommunications (Carrier Licence Charges) Act 1997
This instrument is issued by the authority of the Australian Communications and Media Authority (‘ACMA’).
Legislative Provisions
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 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 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
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 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. Although paragraph 15(1)(e) of the Act was repealed under Telecommunications Legislation Amendment (Competition Consumer Interests) Act 2005, the operation of transitional provisions in the Act provides a statutory power for the Minister for Communications, Information Technology and the Arts to make a determination.
The accompanying Determination has been made for the purposes of paragraph 15(1)(a) of the Act. The Determination provides that $23,227,704 is the amount determined to be the proportion of ACMA’s costs for the 2004-2005 financial year that is attributable to the ACMA’s telecommunications functions and powers. Paragraph 15(4)(a) of the Act requires that the ACMA’s costs are to be calculated in accordance with accrual-based accounting principles. This amount has been calculated in accordance with those principles.
For the purposes of the Legislative Instruments Act 2003, a Determination is considered as a legislative instrument. Therefore the accompanying Determination must be registered on the Federal Register of Legislative Instruments (FRLI).
Consultation
On application for a licence, carriers are advised that this determination is relevant to the imposition and calculation of a carrier licence charge, to recover costs for a financial year if they hold a licence on the first day of the financial year.
The Office of Regulation Review advised that a Regulation Impact Statement was not required for the making of this determination, as the changes were minor and machinery in nature, and did not substantially alter existing arrangements.
Attachment 1
Notes on the Instrument
Section 1 – Name of Determination
This section sets out the name of the determination.
Section 2 – Commencement
This section provides for the commencement of the determination; which is the day after it is registered on the FRLI.
Section 3 – Amount
This section provides the amount determined under the determination.
Overview
The Telecommunications (Costs Attributable to Telecommunications Functions and Powers) Determination 2006 was enacted to provide for the calculation of annual charges imposed on carrier licences held by telecommunications carriers. This instrument was issued by the Australian Communications and Media Authority (ACMA), as authorized by the Telecommunications (Carrier Licence Charges) Act 1997. The primary objective of this determination is to ensure that the total charges imposed on carrier licences do not exceed the sum of various specified costs, including the proportion of ACMA's and the Australian Competition and Consumer Commission's (ACCC) costs attributable to their telecommunications functions and powers, and other specified amounts. The determination specifies that $23,227,704 is the amount determined to be the proportion of ACMA's costs for the 2004-2005 financial year attributable to its telecommunications functions and powers, calculated in accordance with accrual-based accounting principles. This amount is relevant for the imposition and calculation of carrier licence charges for the financial year.
Scope and Application
The Telecommunications (Costs Attributable To Telecommunications Functions and Powers) Determination 2006 applies to telecommunications carriers that hold a carrier licence on the first day of a financial year, as it governs the calculation of annual charges imposed on these licences under the Telecommunications (Carrier Licence Charges) Act 1997. This instrument is issued by the Australian Communications and Media Authority (ACMA) and specifies the amount of costs attributable to telecommunications functions and powers that are to be recovered from carriers. The determination is registered on the Federal Register of Legislative Instruments (FRLI) and is considered a legislative instrument under the Legislative Instruments Act 2003. The determination sets out that $23,227,704 is the amount determined to be the proportion of ACMA’s costs for the 2004-2005 financial year that is attributable to the ACMA’s telecommunications functions and powers, calculated in accordance with accrual-based accounting principles.
Key Provisions
The Telecommunications (Costs Attributable To Telecommunications Functions and Powers) Determination 2006, issued under the Telecommunications (Carrier Licence Charges) Act 1997, specifies the calculation method for annual charges imposed on carrier licences held by telecommunications carriers. According to subsection 15(1) of the Act, the total charges for a financial year must not exceed certain pre-determined amounts: the proportion of the Australian Communications and Media Authority's (ACMA) costs attributable to its telecommunications functions and powers, the proportion of the Australian Competition and Consumer Commission's (ACCC) costs attributable to its telecommunications functions and powers, the proportion of the Commonwealth's contribution to the International Telecommunication Union's budget, the estimated total amount of grants likely to be made under section 593 of the Telecommunications Act 1997, and the proportion of the Commonwealth's costs for the administration of Part 2 of Schedule 1 to the Telecommunications Act 1997. The Determination provides that $23,227,704 is the amount determined to be the proportion of ACMA's costs for the 2004-2005 financial year that is attributable to its telecommunications functions and powers, calculated in accordance with accrual-based accounting principles as required by paragraph 15(4)(a) of the Act.
Entities governed by the Act, specifically telecommunications carriers, are obligated to comply with the charge calculation methodology outlined in the Determination. Carriers must ensure that their licence fees are calculated in alignment with the specified provisions, and any changes in costs attributable to telecommunications functions and powers must be accurately reflected in their financial reporting. Carriers holding a licence on the first day of a financial year are specifically advised that this determination impacts the imposition and calculation of carrier licence charges to recover costs for that year.
Failure to adhere to the requirements set forth in the Determination may result in non-compliance with the Act. Although specific offences, penalties, or consequences for breach are not detailed in the provided text, it is reasonable to infer that non-compliance could lead to regulatory scrutiny or potential legal actions by the ACMA. Given the nature of the Act and the importance of accurate financial reporting in regulatory compliance, penalties could potentially include fines or other administrative actions to enforce adherence to the specified charge calculation methods.