ACCC unveils interim price determinations for fixed line services

7 Mar 2011

The Australian Competition and Consumer Commission (ACCC) has revealed its interim access determinations (IADs) for fixed line services, having suspended a full review of charges in December 2010 in light of the changes to the country’s regulations; the passing of the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Act 2010 in November 2010 prompted the halt in the study. Under the now-released determinations the ACCC has issued interim price and non-price terms for the six declared fixed line services, those being: unconditioned local loop service (ULLS); wholesale line rental (WLR); line sharing service (LSS); PSTN Originating and Terminating Access (PSTN OA and PSTN TA); and local carriage service (LCS). According to the regulator the determinations have been backdated to start from 1 January 2011 and will expire at the end of this year, or on the introduction of a final access determination (FAD) for any of the aforementioned services.

One notable decision by the ACCC is the setting of a single price for ULLS of AUD16 (USD16.2) per month for central business districts, metropolitan and regional areas (Bands 1, 2 and 3). While the charge remains unchanged in Band 2, the new determinations means that it climbs from AUD6.60 in Band 1, and falls from AUD31.30 in Band 3; the regulator said the move would help ‘promote industry stability during the transition to the new access regime.’ Wholesale prices for other services such as WLR and LCS meanwhile have fallen to AUD22.10 per month and AUD0.091 per call respectively, with the ACCC noting that the reductions were the result of lower assessed costs of providing the services and the move away from the previous pricing approach which was based on fixed line incumbent Telstra’s retail prices for these services.

Commenting on the development ACCC chairman Graeme Samuel said: ‘Today marks the first step in implementing the new telecommunications access regime … While parties are still able to negotiate their own terms and conditions, the interim access determinations establish a benchmark for Telstra and access seekers to fall back on when negotiating terms and conditions.’ The regulator is now expected to launch a public inquiry regarding FADs for the declared fixed line services as required by the new legislation.