Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014

Administered by Department of Infrastructure, Transport, Regional Development, Communications, Sport and the Arts

Legislation au F2014L00639 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Telecommunications (Consumer Protection and Service Standards) Act 1999

 

Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014

 

Issued by the Authority of the Minister for Communications

 

Authority

 

The Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014 (the Declaration) is made by the Minister for Communications (the Minister) under paragraphs 8J(1)(d) and 8K(1)(d) of the Telecommunications (Consumer Protection and Service Standards) Act 1999 (the Act).  These provisions enable the Minister to declare a ‘first declaration deferral period’ in relation to alternative contractual arrangements for the standard telephone services (STS) and payphones universal service obligation (USO).

 

Purpose

 

The Declaration provides that the 18-month period starting immediately after the Declaration is made is the ‘first declaration deferral period’ for the purposes of sections 8J and 8K of the Act.

Background

The USO is Australia’s base-level telecommunications consumer safeguard.  Specifically, Telstra, as the Primary Universal Service Provider (PUSP), has an obligation to supply STS to all people in Australia on request (under paragraph 9(1)(a) of the Act), and the obligation to supply, install and maintain payphones in Australia (under paragraph 9(1)(b) of the Act). 

 

Various legislative instruments have also been made under the Act in relation to these obligations, including: 

  • a determination setting out requirements on Telstra when it supplies STS, and circumstances in which it does not need to supply a STS under the USO; and
  • various instruments setting out rules, standards and benchmarks for Telstra’s supply of payphones, including its obligations when it removes a payphone, which were also made in 2011 and took effect from 1 January 2012.

 

In 2012 the Parliament passed legislation establishing a framework for phasing out the legislated USO and replacing it with a contractual framework under the Telecommunications Universal Service Management Agency Act 2012 (TUSMA Act).  As part of the consequential amendments to the TUSMA Act, sections 8J and 8K were inserted into the Act to enable the progressive removal of STS and payphone USO obligations from Telstra.

 

Under subsection 8J(1) of the Act, the Minister must make a declaration as to whether or not there are satisfactory alternative contractual arrangements in place for STS.  This declaration must take place in the period beginning 18 months after commencement of the amendments to the Act and ending 23 months after commencement (i.e. between 1 January 2014 and 31 May 2014).  Separately, and during the same time period, under subsection 8K(1) of the Act, the Minister must make a similar declaration in relation to whether or not there are satisfactory alternative contractual arrangements in place for payphones.

 

In June 2011, the Government announced it had entered into an agreement with Telstra for the delivery of certain public interest telecommunications services which included the provision of the STS and payphones USO (Telstra Agreement).   This agreement commenced on 1 July 2012 and remains in force with neither party having given notice of termination of the contract.

 

In relation to both STS and payphones, the Minister is not able to make a positive declaration unless the relevant part of the Telstra agreement remains in force; and the Minister is satisfied that Telstra is likely to substantially comply with the contract if this part of USO regulation is removed.  In deciding whether Telstra is likely to substantially comply with the contract, the Minister will be able to have regard to a range of non-exhaustive criteria, including Telstra’s record of compliance with relevant contractual obligations and the nature of those obligations as well as Telstra’s compliance with its regulatory obligations (including Part 2 of the Act, the universal service regime and Part 5 of the Act, the customer service guarantee) (subsections 8J(6) and 8K(6)).

 

The Minister has decided to defer the lifting of regulatory USO obligations in relation to both STS and payphones.  In making this decision the Minister has had particular regard to the Australian Communications and Media Authority’s (ACMA) Communications Reports for 2011-12 and 2012-13 in which it was noted that Telstra did not meet all the benchmarks applicable to the Customer Service Guarantee set out in the Telecommunications (Customer Service Guarantee – Retail Performance Benchmarks) Instrument (No. 1) 2011.  Telstra was issued with an infringement notice and a formal warning by the ACMA on 27 November 2013 in relation to breaches of the benchmarks.[1]

 

The Minister also has had particular regard to Telstra’s performance in relation to its payphones obligations. Telstra has not complied with all the requirements of the Telecommunications Universal Service Obligation (Location of Payphones) Determination 2011 and the Telecommunications Universal Service Obligation (Public Consultation on the Location or Removal of Payphones) Determination 2011 and was issued with a formal warning by the ACMA on 27 November 2013 in relation to breaches of these instruments.[2]

 

The effect of the Declaration is that USO regulatory obligations in relation to STS and payphones continue to apply at least until the end of the ‘first declaration deferral period’.  The first declaration deferral period lasts for 18 months after the Declaration is made – i.e. until November 2015.  Before the end of the first declaration deferral period, the Minister must make another declaration as to whether or not there are satisfactory alternative contractual arrangements in place for STS and/or payphones.

 

Consultation

 

The Department consulted Telstra, the Telecommunications Universal Service Management Agency and the ACMA in respect to this instrument.

 

Regulatory impact

The Office of Best Practice Regulation (the OBPR) has agreed that the regulatory changes arising from the Declaration are machinery in nature and that no further regulatory impact analysis is required. The OBPR regulatory impact statement exemption number is ID 2012/15257.

 

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 Declaration provides that the 18-month period starting immediately after the Declaration is made is the first declaration deferral period for the purposes of sections 8J and 8K of the Act.  The Declaration, in essence, retains the status quo arrangements in relation to the STS and payphone USO obligations.

 

The Declaration 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 Declaration is a legislative instrument for the purposes of the Legislative Instruments Act 2003.  

 

Notes on sections

Section 1 - Name of Declaration

Section 1 provides that the name of the Declaration is the Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014.

Section 2 - Commencement

Section 2 provides that the Declaration commences on the day after it is registered on the Federal Register of Legislative Instruments.

Section 3 - Definitions

This section defines the terms used in the Declaration.

Section 4 - Declaration

This section provides that the 18-month period starting immediately after the Declaration is made is the first declaration deferral period for the purposes of sections 8J and 8K of the Act. 

[1] See http://www.acma.gov.au/Industry/Telco/Carriers-and-service-providers/Obligations/telstra-pays-financial-penalty.

[2] Ibid.

Overview

The Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014 was made by the Minister for Communications under paragraphs 8J(1)(d) and 8K(1)(d) of the Telecommunications (Consumer Protection and Service Standards) Act 1999 (the Act). The purpose of the Declaration is to establish an 18-month deferral period starting immediately after the Declaration, during which the regulatory obligations under the Universal Service Obligation (USO) for standard telephone services and payphones will continue to apply. This was done to allow time for alternative contractual arrangements to be put in place and to ensure continued compliance with service standards by Telstra, the Primary Universal Service Provider. The Declaration responds to concerns highlighted in the Australian Communications and Media Authority's (ACMA) Communications Reports for 2011-12 and 2012-13, which noted that Telstra had not met all the benchmarks applicable to the Customer Service Guarantee and had breached certain payphone obligations. The Minister's decision to defer the lifting of USO obligations was based on Telstra's compliance record and the need for further assessment of alternative arrangements. The Declaration was made in consultation with relevant stakeholders and is considered compatible with human rights under the Human Rights (Parliamentary Scrutiny) Act 2011.

Scope and Application

The Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014, made under the Telecommunications (Consumer Protection and Service Standards) Act 1999, pertains specifically to the universal service obligations (USO) related to standard telephone services (STS) and payphones in Australia. This Declaration applies to the Primary Universal Service Provider (PUSP), Telstra, which has statutory obligations to supply STS to all people in Australia on request and to supply, install and maintain payphones across the country. The Declaration establishes an 18-month period from its commencement as the 'first declaration deferral period', during which the regulatory USO obligations for both STS and payphones will remain in effect. This period extends until November 2015 and requires the Minister for Communications to reassess the presence of satisfactory alternative contractual arrangements for these services before the end of this period. The Declaration's jurisdictional reach is national, applying uniformly across Australia, and it extends its application through the Telecommunications Universal Service Management Agency Act 2012. The Declaration does not specify any exclusions or exemptions but relies on the ongoing validity of the Telstra Agreement and Telstra's compliance performance for its implementation.

Key Provisions

The Telecommunications Universal Service Obligation (First Declaration Deferral Period) Declaration 2014 establishes an 18-month period, commencing immediately after the declaration is made, as the 'first declaration deferral period' for the purposes of sections 8J and 8K of the Telecommunications (Consumer Protection and Service Standards) Act 1999 (the Act). This period extends until November 2015. During this period, the Minister for Communications has the authority to defer the lifting of regulatory obligations in relation to standard telephone services (STS) and payphones. The Act requires the Minister to make a declaration regarding the existence of satisfactory alternative contractual arrangements for STS and payphones within a specified time frame, and this declaration can only be positive if certain conditions are met, including the continuation of the Telstra Agreement and the Minister's satisfaction that Telstra will likely comply with its contractual obligations. The obligations imposed by the Act on parties and entities, particularly Telstra as the Primary Universal Service Provider (PUSP), include the provision of STS to all Australians upon request and the installation and maintenance of payphones. These obligations are outlined in section 9(1) of the Act. Additionally, Telstra must adhere to various legislative instruments that set out specific requirements and standards for the supply and removal of payphones. The Act mandates that the Minister must consult with relevant parties, such as Telstra, the Telecommunications Universal Service Management Agency, and the Australian Communications and Media Authority (ACMA), before making the declaration. There are no specific offences, penalties, or civil/criminal consequences mentioned in the Declaration itself. However, the Act includes provisions for infringement notices and penalties for breaches of the Customer Service Guarantee and other regulatory obligations. For instance, Telstra was issued with an infringement notice and a formal warning by the ACMA for breaching the Customer Service Guarantee benchmarks. The Declaration's primary function is to provide a framework for deferring the lifting of regulatory obligations, ensuring that the status quo remains in place until the Minister can make another declaration. This deferral period allows for continued oversight and compliance monitoring by the ACMA and other relevant authorities.

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Telecommunications Law
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Declaration
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Commencement Provisions
Regulatory Standards
Reporting & Disclosure Obligations

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.