New timeframe for Telstra’s structural separation as Conroy publishes draft guidelines

2 Jun 2011

The Australian communications minister Stephen Conroy has published draft guidelines governing fixed line incumbent Telstra’s migration to the in-deployment National Broadband Network (NBN), The Australian reports. In releasing the draft rules, Mr Conroy has laid down the steps that the Australian Competition and Consumer Commission (ACCC) must follow in determining whether Telstra’s structural separation falls in line with the state’s goals for the NBN and its ongoing reforms of the nation’s telecommunications regulations. Included in the draft rules are: the arrangements to govern the structural division of Telstra; interim arrangements for the period between Telstra reaching a deal over migration to the NBN and the actual completion of the network; the migration of customers from Telstra’s copper network to the NBN; and the level of transparency that must apply to Telstra during the structural separation process. Interested parties have now been given until 15 June to make submissions regarding the draft rules, following which the ACCC will have 30 days to finalise the regulations before a 90-day deadline will be given to Telstra to hand over its structural separation undertaking to the regulator. Should the incumbent fail to meet the deadline, Senator Conroy will be able to use special legislative powers to force the structural separation of Telstra, while potentially denying it access to additional wireless spectrum it needs to help further develop its mobile network. It is understood meanwhile that, while the vast majority of the Telstra’s undertakings have in fact been completed, it is holding off making its submission until it has reached a final deal with NBN Co, the company overseeing the NBN’s construction and management, over the migration of its customer base to the new fibre infrastructure.

Commenting on this latest development, Senator Conroy said: ‘In my guidance to the ACCC, and under the reforms passed late last year, I have made clear that the ACCC must not accept a structural separation undertaking unless it is satisfied Telstra will put in place appropriate and effective transparency and equivalence arrangements during the transition to structural separation.’