Draft decision on liability allocation released

Commission releases draft decision on liability allocation for Telecommunications providers

The Commerce Commission today released its draft decision about how much 22 telecommunications providers will pay towards the $50 million Telecommunications Development Levy (TDL) for 2013/14.

The government uses the annual levy to pay for telecommunications infrastructure including the relay service for the deaf and hearing-impaired, broadband for rural areas, and improvements to the 111 emergency service.

The levy — about 1% of telecommunications services revenue — is paid by companies, or groups of companies, earning more than $10 million per year from operating a component of a public telecommunications network (fixed or wireless).

The Commission’s draft decision sets out how much of the $50 million levy each of these ‘qualifying liable persons’ should pay in proportion to their qualified revenue. Based on the draft decision, almost 90% of the contributions will be paid by Spark, Chorus and Vodafone.
The Commission invites submissions on this draft decision. Submissions should be sent to telco@comcom.govt.nz by 5pm, 28 November 2014. The Commission anticipates releasing its final decision by late December 2014.

Background
The Telecommunications Development Levy (TDL) was established by legislation in June 2011. The levy is set at $50 million a year until 2016.

The TDL replaced the Telecommunications Service Obligations (TSO) liability allocation process and streamlined the process for industry contributions to the TSO, broadband for rural areas, and other government-led improvements to New Zealand's telecommunications infrastructure.

The Commission is required to prepare an annual TDL liability allocation determination in accordance with subpart 2 of Part 3 of the Telecommunications Act 2001.

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