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New regulatory regime for telecommunications lines

New regulatory regime for telecommunications lines hits Parliament

By Paul McBeth

Aug. 8 (BusinessDesk) - Communications Minister Simon Bridges will today table legislation bringing the regulatory pricing regime for fibre and copper line infrastructure in line with their electricity and gas distribution counterparts.

The bill paves the way for a regulated pricing regime for fibre from 2020 and deregulating wholesale copper line access where it competes with the newer technology. The government launched a review of the 15-year-old Telecommunications Act in 2015 to gauge the crossover with broadcasting and to have a look at the way network service pricing was regulated after Chorus underestimated the extent it would have to cut wholesale prices when it was carved out of Telecom Corp, now Spark New Zealand.

"We need to ensure the regulatory settings continue to be fit-for-purpose and support the evolution of this fast-moving sector,” Bridges said in a statement. "The bill supports the shift to fibre as the technology of choice among an increasing number of consumers, by establishing a stable and predictable framework for regulating fibre and by removing copper regulation from 2020."

The bill also seeks to improve information available to consumers, imposing greater oversight of the development and maintenance of consumer codes and empowering the Commerce Commission to act if those guides are inadequate.

Industry lobbies largely welcomed the introduction of the legislation, although Telecommunications Users Association New Zealand chief executive Craig Young said it didn't address "the inequality of resourcing for consumer voice research and advocacy that exists in New Zealand when compared to other jurisdictions such as Australia", while Internet New Zealand chief executive Jordan Carter said the government's designated anchor products designed to act as a benchmark across all broadband services was "too slow a product for this function and we will propose an alternative as part of the select committee process".

Bridges said the bill will have its first reading later this month.

Chorus executive Vanessa Oakley said the network operator was pleased to see progress on the bill and will focus "on ensuring that the regulatory framework is predictable in its implementation at 2020, reduces the level of complexity and encourages ongoing investment through a fair return and ongoing innovation for consumers on high quality infrastructure".

The network operator's shares last traded at $4.48, and have gained 13 percent this year.

Spark, Chorus's biggest customer, said the bill was consistent with previous government guidance and that the retailer "will continue to engage on the finer details of the legislation as the bill goes through the parliamentary process over coming months".

Spark's shares last traded at $3.84 and have gained 13 percent this year.



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