ACCC gives blessing to NBN Co's proposed acquisition of TransACT FTTP network

18 Nov 2013

The Australian Competition and Consumer Commission (ACCC) has confirmed that it will not oppose the proposed acquisition of TransACT’s fibre-to-the-premises network by NBN Co, the public-private company overseeing the National Broadband Network (NBN) project.

As previously reported by CommsUpdate, in May 2013 NBN Co agreed to purchase TransACT’s FTTP network in Canberra for AUD9 million (USD9.37 million) from the latter’s parent company, iiNet. Under the terms of the deal NBN Co said it would acquire both the existing fibre infrastructure, which at present covers approximately 8,5000 premises, but is expectedly to be expanded to around 17,500 premises in total. Further, having confirmed it would pay for long-term access to TransACT’s extensive system of underground ducts throughout the Australian Capital Territory (ACT), NBN Co at the time of the deal’s announcement said it planned to integrate the TransACT FTTP network with the NBN.

In order to reach its decision the ACCC said it had consulted with a range of interested parties, including customers of TransACT and telecoms service providers in the Australian Capital Territory (ACT). Speaking on the matter, the regulator’s chairman Rod Sims was cited as saying: ‘Importantly, the ACCC considered that it was highly unlikely that NBN Co would overbuild the TransACT FTTP network in the absence of the proposed acquisition … The ACCC therefore concluded that the proposed acquisition represents a bare transfer of assets and wholesale market share from TransACT to NBN Co. Accordingly, the proposed acquisition is unlikely to substantially lessen competition in any relevant wholesale or retail market.’

Meanwhile, in a press release confirming its approval for the FTTP network acquisition, the ACCC claimed that the proposed deal will remove TransACT’s vertical integration in the areas passed by its FTTP network, potentially opening up these areas to increased retail competition via the entry of other retail service providers.