EXPLANATORY STATEMENT

Telecommunications (Specification of Costs by ACMA) Determination 2011

Telecommunications (Carrier Licence Charges) Act 1997

Issued by the authority of the Australian Communications and Media Authority

The Telecommunications (Specification of Costs by ACMA) Determination 2011 (the Determination) is made by the Australian Communications and Media Authority (the ACMA) pursuant to paragraphs 15(1)(a), (c) and (ca) of the Telecommunications (Carrier Licence Charges) Act 1997 (the Act).

Legislative Provisions

The Act limits the total amount of annual charges that may be imposed on carrier licences held by the telecommunications carriers.  Subsection 15(1) of the Act states that the total of the 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 Australian Competition and Consumer Commission  (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

(ca) the amount determined, by a written instrument made by the ACMA, to be the sum of the amounts paid under section 136C of the Telecommunications Act 1997 during the immediately preceding financial year; 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.

A determination made under subsection 15(1) of the Act is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Purpose

The Determination has been made for the purposes of paragraphs 15(1)(a), (c) and (ca) of the Act. The Determination provides that:

• Under paragraph 15(1)(a), $22 008 004 is the amount determined to be the proportion of the ACMA’s costs for the 2009-2010 financial year that is attributable to the ACMA’s telecommunications functions and powers.  Paragraph (a) of the definition of “cost” in subsection 15(4) of the Act has the effect 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.

• Under paragraph 15(1)(c), $1 603 978 is the amount determined to be the proportion of the Commonwealth's contribution to the budget of the International Telecommunication Union (ITU) associated with telecommunications for the 2010 calendar year that is to be recovered from carriers.  The amount is calculated by apportioning the Commonwealth’s total ITU contribution between the ITU’s Radiocommunication Sector and Telecommunication Standardisation Sector on the basis of the total ITU budget for both sectors.

• Under paragraph 15(1)(ca), the amount determined to be the sum of the amounts paid under section 136C of the Telecommunications Act 1997 during the 2009-2010 financial year is nil.  No amounts were paid by the ACMA pursuant to subsection 136C(3) of the Telecommunications Act 1997 during the 2009-2010 financial year.

Consultation

On application for a licence, carriers are advised that a determination made by the ACMA under subsection 15(1) of the Act is relevant to the calculation of annual carrier licence charge, which is imposed on a carrier licence in force on the first day of the relevant financial year and is payable by the holder of the licence. The Determination is therefore minor or machinery in nature and consultation is not required in accordance with section 18 of the Legislative Instruments Act 2003.

On 14 April 2011, the Office of Best Practice Regulation advised that a Regulation Impact Statement was not required for the Determination proposed to be made by the ACMA under paragraphs 15(1)(a), (c) and (ca) of the Act, (reference number ID 12559), on the basis that the proposals would have a low impact on business and would appear to impose no or low compliance costs.

On 7 March 2011, the Department of Broadband, Communications and the Digital Economy provided the figures for the Commonwealth’s contribution to the budget of the International Telecommunication Union for the 2010 calendar year.

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 that the Determination commences on the day after it is registered.

Section 3 – Definition

This section provides a definition of ‘Act’ and ‘ACMA’.

Section 4 - Determination of amount attributable to telecommunications functions and powers

This section sets out the amount determined for the purposes of paragraph 15(1)(a) of the Act.

Section 5 - Determination of amount of ITU contribution to be recovered

This section sets out the amount determined for the purposes of paragraph 15(1)(c) of the Act.

Section 6 - Determination of amounts paid under section 136C of Telecommunications Act 1997

This section sets out the amount determined for the purposes of paragraph 15(1)(ca) of the Act.