Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Chorus wants regulator’s pricing review set aside

Chorus tells High Court it wants regulator’s pricing review set aside

By Paul McBeth

March 18 (BusinessDesk) - - Chorus, whose shares have tumbled 53 percent in the past two years because of price cuts imposed by the regulator, wants the Commerce Commission’s review of network pricing set aside, the High Court heard today.

The network operator told Justice Stephen Kos that it wants the initial pricing principle (IPP) process for its unbundled bitstream access services set aside and for the regulator to go back to the drawing board.

The Commerce Commission has ordered Chorus to slash prices for access to its copper lines, a move the company says will undermine its profitability and its ability to build the government-sponsored fibre network.

Chorus counsel David Goddard QC told the High Court in Wellington that the IPP process could be restarted without hindering the move to a more robust price review.

Justice Kos said he would have “serious reservations” about setting aside the review and ordering the process to start again.

Chorus’s share price has slumped since November 2012, when the Commerce Commission first made public its view that regulated prices should be cut. The shares rose 1.2 percent to $1.70 on the NZX today.

The stock selloff should have told the regulator the market didn’t anticipate the size of the proposed reduction in pricing, and made it consider section 18 of the Telecommunications Act, which aims to protect innovation and investment in the sector, Goddard told the court yesterday.

The regulator also should have considered what impact regulatory shocks might have on the wider market, and should have telegraphed its thinking, he said.

Chorus is appealing the commission’s final determination in November last year setting the unbundled bitstream access monthly price at $34.44 per line, up from the $32.35 price initially mulled in its draft decision, with the additional UBA component accounting for $10.92 and the unbundled copper local loop accounting for $23.52.

Goddard told the court yesterday that the regulator erred in law when setting the price Chorus can charge for access to its UBA services in that it didn’t have any evidential basis to narrow its inquiry and ignored a section of the legislation aiming to support the government’s goal of building a nationwide fibre network.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news