EXPLANATORY STATEMENT
Telecommunications Universal Service Management Agency Act 2012
Telecommunications (Participating Persons) Determination 2013
Issued by the Authority of the Minister for Broadband, Communications and the Digital Economy
Authority
The Telecommunications (Participating Persons) Determination 2013 (the Determination) is made by the Minister for Broadband, Communications and the Digital Economy (the Minister) pursuant to subsection 92(2) of the Telecommunications Universal Service Management Agency Act 2012 (the Act), which provides that the Minister may determine in writing that a certain kind of person is not a ‘participating person’ for an eligible revenue period under the Act.
Purpose
The Determination exempts certain carriers from being a ‘participating person’ pursuant to section 92 of the Act in relation to the first eligible revenue period under the Act (i.e. the 2011-12 financial year). The consequence of this exemption is that a carrier will be relieved from the liability to pay the levy amount for the eligible levy period (i.e. the 2012-13 financial year), being the amount assessed under section 100 of the Act.
Background
In early 2012, as part of a package of legislation to achieve continuity of key telecommunications safeguards in the transition to the National Broadband Network, the government established a new statutory agency, the Telecommunications Universal Service Management Agency (TUSMA). TUSMA has responsibility for the effective implementation and administration of service contracts or grants that deliver universal service and other public policy telecommunications outcomes.
As part of the reform package, the government consolidated the previous Universal Service Obligation (USO) and the National Relay Service (NRS) levies into a single levy to cover TUSMA’s costs (together with government funding). The levy provisions in Part 6 of the Act are broadly based on the USO levy provisions contained in Part 2 of the Telecommunications (Consumer Protection and Service Standards) Act 1999 (the TCPSS Act).
Under the new levy scheme, a ‘participating person’ will continue to lodge eligible revenue returns with the Australian Communications and Media Authority (the ACMA) and levy payments will continue to be based on the ACMA’s assessment of each participating person’s eligible revenue.
For the first eligible revenue period under the Act (i.e. the 2011-12 financial year), subsection 93(7) provides the eligible revenue of a person is the amount that is assessed by the ACMA under the TCPSS Act as the person’s eligible revenue. The ACMA made the Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003 (the Eligible Revenue Determination) under the TCPSS Act. Therefore, for the first eligible revenue period, a person’s eligible revenue will be calculated in accordance with the Eligible Revenue Determination.
In 2011, as part of the government’s commitment to remove unnecessary red tape in telecommunications regulation, the Minister made the Telecommunications (Participating Persons) Determination 2011 (No.1) (the Existing Determination) under section 20A of the TCPSS Act. The Existing Determination provides that carriers with initial sales revenue, gross telecommunications sales revenue or eligible revenue of less than $25 million (the $25 million threshold) who lodge the requisite statutory declaration with the ACMA within the specified timeframe for the eligible revenue period are non-participating persons under the TCPSS Act for the relevant financial year. This means such carriers are exempt from certain reporting obligations to the ACMA and from contributing to the USO and NRS levies. These carriers are also exempt from annual carrier licence charges for that financial year in accordance with the Australian Communications and Media Authority (Annual Carrier Licence Charge) Direction 2011. Carriers continue to be subject to the requirements of the Telecommunications Act 1997, including the provision of information to the ACMA where specified.
It is the government’s intention that carriers who fall under the $25 million threshold should remain non-participating persons under the new levy scheme. As the transitional provisions under the Act ensure the TCPSS Act will remain valid for the calculation of a participating person’s eligible revenue for the first eligible revenue period, the Existing Determination continues to be relevant. However, it is also necessary to define those persons who are non-participating persons for the first eligible revenue period under the Act. In the absence of such a determination, those persons may be obliged to pay the levy amount for the first eligible levy period. The purpose of this Determination, which operates by referring to the Existing Determination, is to ensure that the same class of carriers remain non-participating persons for the first eligible revenue period under the Act.
Following the first eligible revenue period (i.e. for the 2012-13 financial year and subsequent periods), it is anticipated that:
- the ACMA will make a new eligible revenue determination under subsection 93(1) of the Act; and
- the Minister will make a new participating persons determination under subsection 92(2) of the Act given the Existing Determination and this Determination will no longer apply.
Consultation
The ACMA was consulted in relation to the making of this Determination.
An exposure draft of this Determination was provided to carriers who were participating persons for the 2010-11 eligible revenue period, as well as those additional carriers who might be participating persons for the 2011-12 eligible revenue period. Three submissions were received, none of which raised any concerns regarding this Determination.
Regulatory impact
The Office of Best Practice Regulation (the OBPR) has agreed that the regulatory changes arising from the Determination are machinery in nature and that a Regulation Impact Statement is not required. The OBPR regulatory impact statement exemption number is ID 2012/13814.
Statement of compatibility with human rights
This statement of compatibility is prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
The Determination exempts certain carriers from being participating persons for the purposes of the Act. The 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. It does not engage any of the applicable rights or freedoms and does not raise any human rights issues.
The Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Notes on sections
Section 1 - Name of Determination
Section 1 provides that the name of the Determination is the Telecommunications (Participating Persons) Determination 2013.
Section 2 - Commencement
Section 2 provides that the Determination commences on the day after it is registered on the Federal Register of Legislative Instruments.
Section 3 - Application
Section 3 provides that the Determination only applies in relation to the eligible revenue period for the 2011-12 financial year. This is the first eligible revenue period under the Act and is effectively a transition period in which the eligible revenue of a participating person is calculated under the TCPSS Act but applies to the assessment of the levy amount under the Act for the first eligible levy period.
Section 4 - Definitions
This section defines the terms used in the Determination.
The term ‘USO non-participating person’ is defined to have the same meaning as in subsection 4(4) of the Existing Determination. Subsection 4(4) provides three circumstances in which a person is a USO non-participating person for the purposes of paragraph 20A(2)(b) of the TCPSS Act. Namely, that if a person’s initial sales revenue, gross telecommunications revenue or eligible revenue (as each are defined in the Existing Determination) is less than $25 million and the person has provided an eligible statutory declaration to the ACMA to that effect within the specified timeframe for the eligible revenue period defined in the Existing Determination. The effects of being a USO non-participating person under the Determination are set out at section 5 below.
Section 5 - Determination
This section exempts a USO non-participating person under the Existing Determination from section 92 of the Act.
The effect of section 5 is that if a person is a USO non-participating person for the first eligible revenue period under the Act (the 2011-12 financial period) that person is exempt under section 92 of the Act for that eligible revenue period.
Section 92 of the Act specifies who is, for the purpose of the Act, a participating person for an eligible revenue period. An exemption from section 92 of the Act means that the person is not liable to pay a levy amount under the Act for that period.