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

 


Judges probe as Chorus appeals Comcom pricing

Judges probe as Chorus appeals Comcom pricing

By Pattrick Smellie

July 31 (BusinessDesk) - Telecommunications infrastructure operator Chorus has opened its case in the Court of Appeal, challenging a High Court decision in April upholding the Commerce Commission's lower-than-expected regulated prices for broadband internet services delivered over the traditional copper wire network.

In opening submissions, David Goddard QC sought to argue the commission had failed in both law and logic when it set the price for unbundled bitstream access (UBA) service at $10.92 a month, far lower than Chorus had anticipated.

He faced sustained questioning from Justices Ellen France, Lyn Stevens and Douglas White on the merits of an argument that depends first on accepting the commission was wrong in the way it applied the price-setting methodology, and that the High Court then accepted those errors, making errors in law itself in the process.

The appeal is one of several strands of activity for Chorus as it attempts to roll back as far as possible regulatory constraints on its earnings, which it says will constrain its ability to fulfil its contract to roll out the the bulk of the government-backed national fibre-optic cable network to accelerate New Zealanders' access to ultra-fast broadband.

The commission is separately reviewing its price-setting methodology, also at Chorus's instigation, with final prices to be set by the end of the year, offering Chorus another potential avenue to achieve higher prices for UBA. It argues the new UBA prices, scheduled to kick in from December, are so low as to risk discouraging consumers from switching to cable-based UFB services, which was the original policy aim of the government's subsidised roll-out.

In reaching the price of $10.92 a month for copper-based UBA services, the commission had erred by setting the rate at the same level as applied in Sweden, which along with Denmark was chosen as a benchmark for establishing New Zealand prices, said Goddard. That was because the commission had concluded that an appropriate rate in New Zealand would be higher than Sweden's.

All three judges questioned that reading of the process and the requirements on the commission, with Justice Stevens challenging Goddard's contention that $10.92 a month was "logically incoherent".

If Goddard was right, that implied "it (UBA pricing) would be logical at $10.93, which rather points to the technical nature of your argument," said Justice Stevens, who suggested the legislation governing regulated price-setting ultimately boiled down to a matter of judgement.

"Yes," replied Goddard. "It is a matter of judgement, but the judgement must be one that isn't internally inconsistent or illogical."

The hearing is continuing.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Fruit & Veg Crackdown: Auckland Fruit Fly Find Under Investigation

The Ministry for Primary Industries (MPI) is investigating a find of a single male Queensland fruit fly in a surveillance trap in the Auckland suburb of Grey Lynn... MPI has placed legal controls on the movement of fruit and some vegetables outside of a defined circular area which extends 1.5km from where the fly was trapped in Grey Lynn. More>>

ALSO:

Scoop Business: Westpac NZ Reaches $2.97M Swaps Settlement

Westpac Banking Corp’s New Zealand unit has agreed to pay $2.97 million in a settlement with the Commerce Commission over the way the bank sold interest rate swaps to farmers between 2005 and 2012. More>>

ALSO:

Going Dutch: Fonterra Kicks Off $144M Partnership With Dutch Cheese Maker

Fonterra Co-operative Group, the world’s largest dairy exporter, has commissioned a new dairy ingredients plant in Heerenveen, in the north of the Netherlands, its first wholly-owned and operated ingredients plant in Europe. More>>

ALSO:

Scoop Business: NZ Retail Sales Beat Estimates

New Zealand retail sales rose more than expected in the fourth quarter, led by vehicle-related transactions, food and beverages, adding to evidence that cheap credit and a growing jobs market are encouraging consumers to spend. More>>

ALSO:

Delivery Cuts Go Ahead: 'Government Money Grab' From NZ Post

"It's a money grab by the Government as the shareholder of New Zealand Post" says Postal Workers Union advocate Graeme Clarke about the changes announced by NZ Post. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news