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Draft Report On Regulation Extension

Extension of regulated telecommunication services:
draft report

The Commerce Commission today released its draft report on whether regulation of ten telecommunications services should be extended for two years.

The draft report recommends that regulation of all ten services under review be extended for two years from 19 December 2006. The services are the interconnection, retail resale, national roaming and number portability services, and co-location on cellular mobile transmission sites. It is the Commission’s view that in the case of all ten services under investigation, an extension of the period of regulation will promote competition.

The draft report is available on the Commission’s website at http://www.comcom.govt.nz under Telecommunications, Investigations.

Written submissions on the Commission’s draft report close on 28 June 2006. The Commission expects to hold a conference in mid-July and send its final recommendations to the Minister of Communications by the end of August 2006.

Executive Summary (extract from draft report)

i. The thirteen services originally regulated under the Telecommunications Act 2001 (‘the Act’) are due to expire on 19 December 2006. The Commission may make a recommendation to the Minister of Communications that any or all of these services should continue to be regulated under the Act for a further two year period.

ii. The Commission decided that there were reasonable grounds to investigate whether to extend ten of the thirteen services, namely the four ‘retail services’, the two ‘interconnection services’, national roaming, co-location on cellular mobile transmission sites, and the local and cellular number portability services. The current investigation considers only whether these services should be extended, and not whether any amendments should be made to these services. The Commission continues to evaluate whether changes to the existing regulated services should be amended. The Commission has commenced a review into the mobile sector and this is likely to address whether an investigation should be launched into amendments to existing regulated mobile services.

iii. In deciding whether or not to recommend extension of a service, the Commission must satisfy itself that such a recommendation best gives, or would be likely to best give, effect to the purpose of the Act, i.e. the promotion of competition in telecommunications markets for the long-term benefit of end-users. The Commission has assessed whether competition issues which existed prior to and during the initial period of regulation of these services are likely to continue for the period of the extension.

iv. The Commission considers that a finding of limited competition in key markets associated with the ten regulated services, and/or the presence of other factors suggestive of competition concerns in the industry, means that there would be ongoing benefit to the availability of the regulated service for a further two year period.

v. It is the Commission’s view that in the case of all ten services under investigation, an extension of the period of regulation for a further two years will promote competition in telecommunications markets for the benefit of end-users of telecommunications services. Accordingly, the Commission recommends that all ten services be extended for two years from 19 December 2006.

Ends


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