Industry and consumer groups opposed to the regulatory forbearance period in the draft Telecommunications Amendment Bill, have suggested an alternative way to ensure there is price certainty for UFB partners without sacrificing Commerce Commission oversight on pricing.
TUANZ CEO Paul Brislen says the group - which two weeks ago wrote to MPs opposing the Bill - has suggested an alternative solution. It is based on a measure introduced into the Australian regulatory regime in 2002 and is called a Special Access Undertaking (SAU). The group have written to the select committee overseeing the Bill and to Minister Steven Joyce about its idea for an SAU.
“An SAU is a written undertaking in which the provider undertakes to comply with the terms and conditions specified in the undertaking in relation to the provisions of access to access seekers,” reads a note accompanying the TUANZ release today.
"Regulatory certainty could be provided to the access provider by ensuring that an approved SAU prevails over any subsequent attempt to regulate prices. At the same time, however, regulatory oversight of prices can be maintained by allowing the Commission to review and approve price terms in a SAU."
Under an SAU, the UFB partner (which could be Telecom, or a member of the New Zealand Regional Fibre Group) would declare wholesale prices at the signing of the contract. The SAU would then exist for a certain period of time.
Brislen says he is not happy with the current forbearance period which sees the Commission’s involvement in price oversight begin in 2020."My preference would be for no forbearance period, but if we’re to have one then one covered by the SAU process would be acceptable."
Brislen says with an SAU regulatory certainty is achieved because the Commission could only investigate pricing at the invitation of the UFB partner.
“Telecom would have to say ‘Commissioner we invite you in to have a look, we are crystal clear on our intentions and pricing’,” Brislen explains. “It gives the Minister his regulatory holiday because it’s up to the telco to be able to say ‘OK we’d like to invite the regulator in at this point’.”
Brislen says that Telecom and Vector representatives have said to him that it is not a regulatory holiday they want, it is regulatory certainty, so an SAU is a way of guaranteeing certainty without the need for a regulatory forbearance period.
The telecommunications and industry group proposing the SAU comprises of Call Plus, Kordia/Orcon, TelstraClear, Vodafone, 2 Degrees, Opto Network, Torotoro Waea, Federated Farmers, Consumer New Zealand, TUANZ, and Internet NZ.
Computerworld has sought comment on the SAU proposal from Telecom, New Zealand Regional Fibre Group, ICT Minister Steven Joyce and Labour Party ICT spokesperson Clare Curran.