AUSTRALIAN COMPETITION TRIBUNAL Application by AAPT Limited (No 2) [2009] ACompT 6 TRADE PRACTICES – telecommunications access regime – request to vary draft exemption orders – inferences drawn by Tribunal Trade Practices Act 1974 (Cth) Pt XIC Application by AAPT Limited [2009] ACompT 5 Application by Chime Communications Pty Ltd (No 2) [2009] ACompT 2 Application by Chime Communications Pty Ltd (No 3) [2009] ACompT 4 RE: APPLICATION UNDER SECTION 152AV OF THE TRADE PRACTICES ACT 1974 FOR A REVIEW OF EXEMPTION ORDER DECISIONS (INDIVIDUAL EXEMPTION ORDERS 5 AND 6 OF 2008) MADE BY THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION UNDER SECTION 152AT(3)(a) OF THAT ACT IN RESPECT OF THE SUPPLY BY TELSTRA CORPORATION LIMITED OF THE PSTN ORIGINATING ACCESS SERVICE BY: AAPT LIMITED, AGILE PTY LTD, CHIME COMMUNICATIONS PTY LTD, MACQUARIE TELECOM PTY LIMITED, POWERTEL LIMITED AND PRIMUS TELECOMMUNICATIONS PTY LIMITED File No 6 of 2008 JUSTICE FINKELSTEIN (PRESIDENT) R DAVEY PROFESSOR D ROUND 9 SEPTEMBER 2009 MELBOURNE IN THE AUSTRALIAN COMPETITION TRIBUNAL File No 6 of 2008 RE: APPLICATION UNDER SECTION 152AV OF THE TRADE PRACTICES ACT 1974 FOR A REVIEW OF EXEMPTION ORDER DECISIONS (INDIVIDUAL EXEMPTION ORDERS 5 AND 6 OF 2008) MADE BY THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION UNDER SECTION 152AT(3)(a) OF THAT ACT IN RESPECT OF THE SUPPLY BY TELSTRA CORPORATION LIMITED OF THE PSTN ORIGINATING ACCESS SERVICE BY: AAPT LIMITED, AGILE PTY LTD, CHIME COMMUNICATIONS PTY LTD, MACQUARIE TELECOM PTY LIMITED, POWERTEL LIMITED AND PRIMUS TELECOMMUNICATIONS PTY LIMITED Applicants TRIBUNAL: JUSTICE FINKELSTEIN (president) R davey professor d round DATE OF ORDER: 9 SEPTEMBER 2009 WHERE MADE: MELBOURNE THE TRIBUNAL ORDERS THAT: 1. Title This Order may be cited as the Tribunal's 2009 PSTN OA CBD Individual Exemption Order. 2. Commencement This Order comes into effect on the date this Order is made. 3. Interpretation Unless the contrary intention appears, in this Order a word or a phrase has the meaning given to it in the Act, the Telecommunications Act 1997 (Cth) or the PSTN OA Declaration. Act means the Trade Practices Act 1974 (Cth). Commission's Order means Individual Exemption Order No 6 of 2008 made by the Commission on 30 October 2008 in "Telstra's PSTN Originating Access exemption applications – CBD and Metropolitan areas". International Special Service Code means a special services number (access code) in Part 2 of Schedule 4 of the Telecommunications Numbering Plan 1997 (described in clause 3.18 of that instrument) as amended from time to time. PSTN OA means the Domestic PSTN Originating Access Service declared by the Commission under section 152AL(3) of the Act pursuant to the PSTN OA declaration. PSTN OA Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the Domestic PSTN Originating Access Service with effect from 1 August 2006 and published in the Commonwealth of Australia Gazette No GN 31 of 9 August 2006, as varied or extended from time to time. ULLS means the Unconditioned Local Loop Service declared by the Commission under section 152AL(3) of the Act pursuant to the ULLS Declaration. ULLS Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the ULLS with effect from 1 August 2006 and published in the Commonwealth of Australia Gazette No. GN 31 of 9 August 2006, as varied or extended. VPN Access Code means a special services number (access code) in Part 4 of Schedule 4 to the Telecommunications Numbering Plan 1997 (described in clause 3.20 of that instrument) as amended form time to time. 4. Exemption Subject to the variation specified in paragraph 5, the Commission's Order is affirmed. 5. Variation The Commission's Order be varied by the deletion of paragraph 2(2) and, in its place, the substitution of the following paragraph: "This Order will expire (a) five years after the date of the making of the Tribunal's 2009 PSTN OA CBD Individual Exemption Order; or (b) upon the revocation of either the PSTN OA Declaration or the ULLS Declaration, whichever first occurs." IN THE AUSTRALIAN COMPETITION TRIBUNAL File No 6 of 2008 RE: APPLICATION UNDER SECTION 152AV OF THE TRADE PRACTICES ACT 1974 FOR A REVIEW OF EXEMPTION ORDER DECISIONS (INDIVIDUAL EXEMPTION ORDERS 5 AND 6 OF 2008) MADE BY THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION UNDER SECTION 152AT(3)(a) OF THAT ACT IN RESPECT OF THE SUPPLY BY TELSTRA CORPORATION LIMITED OF THE PSTN ORIGINATING ACCESS SERVICE BY: AAPT LIMITED, AGILE PTY LTD, CHIME COMMUNICATIONS PTY LTD, MACQUARIE TELECOM PTY LIMITED, POWERTEL LIMITED AND PRIMUS TELECOMMUNICATIONS PTY LIMITED Applicants TRIBUNAL: JUSTICE FINKELSTEIN (president) R davey professor d round DATE OF ORDER: 9 SEPTEMBER 2009 WHERE MADE: MELBOURNE THE TRIBUNAL ORDERS THAT: 1. Title This Order may be cited as the Tribunal's 2009 PSTN OA Metropolitan Individual Exemption Order. 2. Nature of Order 2.1 This order operates to vary Individual Exemption Order No 5 of 2008 made by the Commission on 29 October 2008 in "Telstra's PSTN Originating Access exemption applications – CBD and Metropolitan areas". 2.2 A copy of this Order, marked up to show each variation to the Commission's order, is on the Tribunal's file and available for inspection. 3. Commencement and Expiry 3.1 This Order comes into effect on the date this Order is made. 3.2 This Order will expire: (a) five years after the date of the making of this Order; or (b) upon the revocation of either the PSTN OA Declaration or the ULLS Declaration, whichever first occurs. 4. Interpretation Unless the contrary intention appears, in this Order a word or a phrase has the meaning given to it in the Act, the Telecommunications Act 1997 (Cth) or the PSTN OA Declaration. Act means the Trade Practices Act 1974 (Cth). Aggregate Market Share means in respect of each Attachment A ESA the ULLS-based competitors' aggregated share of SIOs, expressed as a percentage, using the following formula: (ULLS + ULLS Spare Capacity + WLR SIOs) ÷ (Total SIOs) Where: ULLS in relation to an Attachment A ESA means the number of "Total ULLS" reported in compliance with the CAN RKR. ULLS Spare Capacityin relation to an Attachment A ESA means a number to be ascertained in accordance with this Order. WLR SIOs in relation to an Attachment A ESA means a number to be ascertained in accordance with this Order. Total SIOs in relation to an Attachment A ESA means the sum of "SIO POTS Only", "SIO (POTS + xDSL)", "Telstra xDSL no POTS" and "Total ULLS" as reported in compliance with the CAN RKR. If there is a change to the CAN RKR so that Telstra is no longer required to provide any of the data required to calculate Aggregate Market Share, then Telstra must, within 28 Business days after each Ascertainment Date, provide that data to the Commission by way of a statutory declaration sworn by its proper officer. Ascertainment Date means the six month anniversary of the Practical Commencement Date and each six months thereafter. Where the Ascertainment Date would otherwise fall on a Saturday, on a Sunday or on a day which is a national public holiday in Australia, the Ascertainment Date is the next Business day. Attachment A ESA means an ESA which is listed in Attachment A to this Order. Bundled Fixed Voice and Broadband Service means a fixed voice service provided together with a broadband service to an end-user both of which are supplied by means of Telstra's metallic-based public switched telephone network. Business day means a day that is not a Saturday, a Sunday or a national public holiday in Australia. CAN RKR means the Telstra Customer Access Network Record Keeping and Reporting Rules as in force on the date of the making of this Order. Carrier or Carriage Service Provider Specific Access Code means: (a) an International Special Service Code (an 001X or 009X code or other equivalent code determined by ACMA); or (b) a VPN Access Code (an 188X code or other equivalent code determined by ACMA). Capped Exchange means an Exchange Building which Telstra has determined is not available for access by an access seeker for any reason, including an Exchange Building listed by Telstra in the TEBA Capped List as 'MDF capped', 'Racks capped' or 'Racks and MDF capped'. Commencement Date means the date on which this Order comes into effect in accordance with clause 3.1. Constructively Capped Exchange means an Exchange Building, other than a Capped Exchange, in respect of which the Commission has determined that Telstra requires as a condition of access that the access seeker undertake works at its own cost which are out-of-the-ordinary works. Deemed Capacity means, with respect to an Attachment A ESA, a number to be calculated in accordance with the following formula: 0.75 x (ULLS ÷ Number of ULLS-based competitors) Where: ULLS in relation to that Attachment A ESA means the number of "Total ULLS" reported in compliance with the most recent CAN RKR. Number of ULLS-based competitors means the number of ULLS-based competitors in that Attachment A ESA. If there is a change to the CAN RKR so that Telstra is no longer required to provide any of the data required to calculate Deemed Capacity, then Telstra must, within 28 Business days after each Ascertainment Date, provide that data to the Commission by way of a statutory declaration sworn by its proper officer. DSLAM means a digital subscriber line access multiplexer, a multi-service access node or other equipment capable of supplying a service via the ULLS. DSLAM Capacity means, with respect to an ULLS-based competitor, its aggregate number of Spare Ports in an Attachment A ESA. end-user means an end-user of carriage services or other services supplied by means of carriage services, not a supplier of those services. Exchange Service Area (ESA) has the meaning given to the expression "Exchange Serving Area" by the Australian Communications Industry Forum Limited Code, ACIF C559:2006, Part 1. Exchange Building means a telecommunications exchange building owned, operated or controlled by Telstra. Exemption means the exemption specified in clause 5 of this Order. Exemption ESA means an Attachment A ESA with: (a) three or more ULLS-based competitors; (b) an Aggregate Market Share equal to or greater than 30%; and (c) ULLS Spare Capacity equal to or greater than 40% of the aggregate number of WLR SIOs in that ESA. Subject to clauses 6.3, 6.5 and 6.6, once an ESA meets the requirements of an Exemption ESA, it will remain an Exemption ESA whether or not it subsequently meets the requirements of an Exemption ESA. Exemption ESA List means the list of Exemption ESAs published on the Commission's website pursuant to clause 6.1 of this Order. First Queued Access Seeker means, in respect of an Attachment A ESA, the Queued Access Seeker that lodged its PSR for an Exchange Building within the ESA first in respect of that ESA. International Special Service Code means a special services number (access code) in Part 2 of Schedule 4 of the Telecommunications Numbering Plan 1997 (described in clause 3.18 of that instrument) as amended from time to time. Joint Completion Inspection (JCI) means an inspection of an Exchange Building by representatives of Telstra and an access seeker conducted following the completion of construction works in that Exchange Building by the access seeker. LCS means the Local Carriage Service declared by the Commission under section 152AL(3) of the Act pursuant to the LCS Declaration. LCS Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the LCS with effect from 1 August 2006 and published in the Commonwealth of Australia Gazette No. GN 31 of 9 August 2006, as varied or extended. LSS means the Line Sharing Service declared by the Commission under section 152AL(3) of the Act pursuant to the LSS Declaration. LSS Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the LSS, the extension of which became effective on 29 October 2007 and was published in the Commonwealth of Australia Gazette No. S214 of 29 October 2007, as varied or extended. MDF means Main Distribution Frame. Minimum Characteristics means the following characteristics of a Prescribed LSS to ULLS Migration Process: (a) any period in which an end-user is unable to receive a broadband service by means of the copper pair servicing the end-user's Standard Telephone Service by reason of that migration is no longer than three (3) hours or such other period determined by the Commission in an access arbitration; and (b) end-user involvement in the process (including without limitation the making of a telephone call or correspondence by the end-user to Telstra) is not required. Potentially Capped Exchange means a Telstra Exchange Building which Telstra has determined may be unavailable for access by an access seeker for any reason including an Exchange Building listed in the TEBA Capped List as 'Potential'. Practical Commencement Date means the first Reporting Date following the Commencement Date. Preliminary Study Request (PSR) means a request by an access seeker to Telstra for access to an Exchange Building. Prescribed LSS to ULLS Migration Process means one or other of the following: (a) a process established by Telstra for the migration by Telstra, at the request of an access seeker, of an end-user from the LSS to the ULLS in an Attachment A ESA, the terms of which are agreed with the access seeker; or (b) a process developed by Telstra for the migration by Telstra, at the request of an access seeker, of end-users from LSS to ULLS in Attachment A ESAs the terms of which are approved to the reasonable satisfaction of the Commission in accordance with the following procedure: Telstra must notify the Commission, if it develops a LSS to ULLS migration process, such notice to: (i) be in writing; (ii) be addressed to the Group General Manager, Communications Group (or such other person as notified by the Commission); (iii) include certification by an officer of Telstra that its LSS to ULLS migration process satisfies the Minimum Characteristics; (iv) detail each aspect of the LSS to ULLS migration process (including without limitation details of how the LSS to ULLS migration will be engineered, timeframes within which the LSS to ULLS migration will take place and details of any administrative processes to be undertaken in conjunction with the LSS to ULLS migration); (v) be in a form appropriate for publication by the Commission on its website; and (vi) not contain any confidential information; or (c) a process established by Telstra for the migration by Telstra, at the request of an access seeker, of an end-user from the LSS to the ULLS in an Attachment A ESA, the terms of which are determined by the Commission (subject to all rights of review and appeal being exhausted) in an access arbitration under Part XIC of the Act, provided that: (i) the reasonable legal costs of any access seeker who participates in the arbitration process are paid by Telstra; and (ii) the LSS to ULLS migration process satisfies the Minimum Characteristics. PSTN OA means the Domestic PSTN Originating Access Service declared by the Commission under section 152AL(3) of the Act pursuant to the PSTN OA declaration. PSTN OA Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the Domestic PSTN Originating Access Service with effect from 1 August 2006 and published in the Commonwealth of Australia Gazette No GN 31 of 9 August 2006, as varied or extended from time to time. Publishing Date means a date three months after the Ascertainment Date. Where the Publishing Date would otherwise fall on a Saturday, on a Sunday or on a day which is a national public holiday in Australia, the Publishing Date is the next Business day. Queued Access Seeker means, in respect of an Attachment A ESA, an access seeker, including a First Queued Access Seeker, who before the Practical Commencement Date submitted a PSR in respect of an Exchange Building within the ESA that: (a) is under consideration by Telstra; or (b) has not been rejected by Telstra; or (c) has not been withdrawn by the access seeker; and (d) has not passed a JCI in relation to the PSR. Reporting Date means the last day of each calendar quarter, i.e. 31 March, 30 June, 30 September, and 31 December. SIO means service in operation. Spare Ports means the ports actually installed on a DSLAM that are not in use but are capable of providing a service via the ULLS. Special Services Global Code means: (a) a freephone service code (180X code); (b) a charge card service code (189XX code); (c) an information service code (190X code); (d) a 13 and 1300 code; and (e) other equivalent or replacement codes determined by ACMA. Standard Telephone Service has the meaning given by section 6 of the Telecommunications (Consumer Protection and Service Standards) Act 1999 (Cth). TEBA Capped List means the document published by Telstra that lists each Exchange Building that Telstra regards as a Capped Exchange or a Potentially Capped Exchange. Telstra means Telstra Corporation Limited (ACN 051 775 556). ULLS means the Unconditioned Local Loop Service declared by the Commission under section 152AL(3) of the Act pursuant to the ULLS Declaration. ULLS-based competitor means an access seeker using the ULLS in an Attachment A ESA to supply a service to an end-user in the ESA. For the avoidance of doubt, Telstra is not an access seeker. ULLS Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the ULLS with effect from 1 August 2006 and published in the Commonwealth of Australia Gazette No. GN 31 of 9 August 2006, as varied or extended. ULLS Spare Capacity means, in respect of an Attachment A ESA that has not been listed on an Exemption ESA List, a number equal to the aggregate DSLAM Capacity of ULLS-based competitors in each Attachment A ESA, as at the Ascertainment Date, determined in accordance with the following procedure: (a) if within 28 Business days after each Ascertainment Date, an ULLS-based competitor gives to the Commission a statutory declaration sworn by its proper officer which verifies the following information, as at the relevant Ascertainment Date, in the format specified in Attachment B to this Order, in respect of every Attachment A ESA that has not been listed on an Exemption ESA List and in which it has a DSLAM installed: (i) the number of DSLAMs installed in each such ESA; and (ii) its DSLAM Capacity for each such ESA, its DSLAM Capacity will be as stated in the statutory declaration; and (b) if an ULLS-based competitor does not give to the Commission a statutory declaration in accordance with, and within the time set out in, preceding clause (a), the ULLS-based competitor's DSLAM Capacity for each Attachment A ESA in which it has installed a DSLAM will be the Deemed Capacity. VPN Access Code means a special services number (access code) in Part 4 of Schedule 4 to the Telecommunications Numbering Plan 1997 (described in clause 3.20 of that instrument) as amended form time to time. WLR means the Line Rental Service (also known as Wholesale Line Rental) declared by the Commission under section 152AL(3) of the Act pursuant to the WLR Declaration. WLR Declaration means the declaration made by the Commission under section 152AL(3) of the Act in respect of the WLR with effect from 1 August 2006 and published in the Commonwealth of Australia Gazette No. GN 31 of 9 August 2006, as varied or extended. WLR SIOs in relation to an Attachment A ESA means the number of the ULLS-based competitors' WLR services in operation in that Attachment A ESA which must be reported by Telstra to the Commission, in the format specified in Attachment C and verified by a statutory declaration sworn by its proper officer, which attests to the accuracy and completeness of that information, within 28 Business days after each Ascertainment Date. 5. Exemption Subject to the conditions and limitations specified in clause 6, Telstra is exempt from any standard access obligation in respect of the supply of PSTN OA within an Exemption ESA, except where PSTN OA is being provided in conjunction with a call dialled using a Special Services Global Code or a Carrier or Carriage Service Provider Specific Access Code. 6. Conditions and Limitations 6.1 The Exemption does not have effect with respect to an ESA until the Commission: (a) makes the necessary calculations to determine which ESAs are Exemption ESAs as at each Ascertainment Date; and (b) publishes on its website a list of those Exemption ESAs by the following Publishing Date. 6.2 The Exemption does not have effect with respect to an ESA until 6 months after the Publishing Date by which the Commission is to publish the Exemption ESA List on which that ESA first appears. 6.3 The Exemption does not have effect with respect to the supply by Telstra of PSTN OA to a Queued Access Seeker in an Exemption ESA. 6.4 The Exemption is subject to the condition that Telstra is required to provide to the Commission within three Business days of Telstra making a determination that an Exchange Building within an Attachment A ESA is a Capped Exchange or Potentially Capped Exchange, written notice of its determination which notice shall: (a) specify the Attachment A ESA, the Exchange Building and whether it has become a Capped Exchange or Potentially Capped Exchange and the date on which it became such an exchange; (b) provide an explanation of why it made the determination; (c) be in a form appropriate for publication by the Commission on its website; and (d) not contain any confidential information. 6.5 The Exemption does not have effect within an Exemption ESA from the date on which an Exchange Building within the Exemption ESA first becomes a Capped Exchange, Potentially Capped Exchange or a Constructively Capped Exchange. 6.6 The Exemption does not have effect within an Exemption ESA from the date on which Telstra ceases to supply the ULLS in the ESA whether to itself or to another person. For the purposes of this limitation, Telstra is deemed to have ceased to supply the ULLS if it ceases to be an access provider of the ULLS in the ESA. 6.7 The Exemption does not have effect with respect to the supply by Telstra of PSTN OA to an access seeker under an agreement which is in force as at the Practical Commencement Date for so long as that agreement remains in force. 6.8 The Exemption does not have effect in relation to, and only to, the supply by Telstra of PSTN OA to an access seeker in respect of an end-user who, immediately prior to the Practical Commencement Date, was supplied with a Bundled Fixed Voice and Broadband Service by the access seeker using the LSS, the WLR service and the LCS supplied by Telstra until the date that a Prescribed LSS to ULLS Migration Process is established. 6.9 In so far as the Exemption has effect as a result of the application of clause 6.8 of this Order in relation to an end-user supplied with a Bundled Fixed Voice and Broadband Service by an access seeker using the LSS, the WLR service and the LCS supplied by Telstra, the Exemption is subject to the condition that Telstra complies with the Prescribed LSS to ULLS Migration Process established for that access seeker. 7. Reporting Format Where applicable, information that is provided to the Commission under this Order must be provided in the reporting format specified in Attachments B or C. ATTACHMENT A ESA NAME ESA CODE STATE Acacia Ridge AARE QLD Avoca Beach ABCH NSW Albany Creek ABCK QLD Albion ABON QLD Ascot ACOT QLD Albury ALBY NSW Alexandra Hills ALXH QLD Aspley APLY QLD Applecross APPX WA Armadale ARMD WA Ascot ASCT VIC Ashfield ASHF NSW Ashmore ASHM QLD Ascot ASOT WA Attadale ATTA WA Avalon Beach AVAL NSW Balaclava BALC VIC Balgowlah BALG NSW Balmain BALM NSW Bankstown BANK NSW Bateman BATA WA Baulkham Hills BAUL NSW Bayswater BAYR VIC Burns BBCH WA Bundaberg BBEG QLD Beechboro BCHS WA Broadmeadows BDWS VIC Beenleigh BEEL QLD Belgrave BELG VIC Belmont BELM VIC Belmont BELT NSW Bendigo BEND VIC Brighton BGON VIC Brooklyn BKLN VIC Blackwood BKWD SA Blacktown BLAC NSW Blakehurst BLAK NSW Blackburn BLBN VIC Belconnen BLCN ACT Balcatta BLCT WA Ballajura BLJA WA Boolaroo BLRO NSW Bulimba BMBA QLD Bundall BNDL QLD Bondi BOND NSW Botany BOTA NSW Box Hill BOXL VIC Ballarat BRAT VIC Brighton BRIH SA Brunswick BRUK VIC Bassendean BSDN WA Bathurst BTST TAS Burwood BURD NSW Burleigh Heads BURL QLD Caboolture CABO QLD Campsie CAMP NSW Cannington CANN WA Carlingford CARL NSW Carramar CARR NSW Castle Hill CAST NSW Caulfield CAUL VIC Coburg CBRG VIC Campbelltown CBTN NSW Coffs Harbour CFSH NSW Chatswood CHAT NSW Chermside CHDE QLD Charlestown CHLS NSW Chapel Hill CHPL QLD Clayton CLAY VIC Cleveland CLVL QLD Coromandel Valley CLVY SA Camberwell CMLL VIC Canning Vale CNVL WA Concord CONC NSW Coogee COOG NSW Corio CORI VIC Capalaba CPBA QLD Camp Hill CPHL QLD Coorparoo CPRO QLD Craigieburn CRBN VIC Canterbury CRBY VIC Crace CRCF ACT Cardiff CRDF NSW Cremorne CREM NSW Currambine CRMS WA Croydon CROH VIC Cronulla CRON NSW Cairns CRSX QLD Croydon CRYD SA Chelsea CSEA VIC Cheltenham CTAM VIC Cottesloe CTOE WA Carlton CTON VIC Civic CVIC ACT Collingwood CWOD VIC City Beach CYTB WA Davey DAEY TAS Dandenong DAND VIC Dandenong North DANN VIC Doubleview DBLV WA Dee Why DEEW NSW Deakin DKIN ACT Doncaster East DNCT VIC Doncaster DONC VIC Darra DRRA QLD Drummoyne DRUM NSW Darwin DRWN NT Dural DURA NSW East EAST NSW Edgecliff EDGE NSW Edwardstown EDWN SA Elsternwick ELSK VIC Eltham ELTM VIC Eight Mile Plains EMPS QLD Endeavour Hills ENDS VIC Engadine ENGA NSW Everton Park ENPK QLD Epping EPPG VIC Epping EPPI NSW Edensor Park ERPK NSW Erskine Park ESPK NSW Eastwood EWOO NSW Elizabeth EZBH SA Ferny Hills FHLS QLD Five Dock FIVE NSW Fremantle FMTL WA Frenchs Forest FREN NSW Forrestfield FRFD WA Frankston FRTN VIC Footscray FSRY VIC Flemington FTON VIC Greensborough GBRH VIC Geelong GEEM VIC Girrawheen GIRR WA Glebe GLEB NSW Glenelg GLLG SA Golden Grove GNGE SA Glenroy GNRY VIC Gosnells GOSN WA Gepps Cross GPCS SA Granville GRAN NSW Greenmount GRMT WA Gosford GSFD NSW Glenunga GUGA SA Gulliver GULL QLD Hamilton HAMN NSW Hamersley HAMS WA Harbord HARB NSW Hawthorn HAWN VIC Heidelberg HDBG VIC Highett HGTT VIC Hilton HILN WA Henley Beach HNLY SA Holsworthy HOLS NSW Homebush HOME NSW Hornsby HORN NSW Hampstead HPSD SA Hartwell HTLL VIC Hunters Hill HUHL NSW Hurstville HURS NSW Inala IALA QLD Ingleburn INGL NSW Ipswich IPSW QLD Joondalup JDLP WA Jandakot JKOT WA Jamboree Heights JREE QLD Jandakot South JTSX WA Karingal KALG VIC Kambah KBAH ACT Kewdale KEDL WA Kellyville KELL NSW Kelmscott KELM WA Kensington KENS NSW Kew KEWE VIC Kangaroo Flat KGRO VIC Killara KILL NSW Kingsgrove KING NSW Kallangur KLGR QLD Kogarah KOGA NSW Kingsley KSLY WA Kooyong KYNG VIC Lakemba LAKE NSW Lane Cove LANE NSW Lavington LAVN NSW Lutwyche LCHE QLD Landsdale LDLE WA Lesmurdie LESM WA Lidcombe LIDC NSW Lindfield LIND NSW Lismore LISM NSW Liverpool LIVE NSW Loganholme LNHE QLD Lanyon LNYN ACT Lonsdale LSDE SA Lyndhurst LYNH VIC Maddington MADD WA Maitland MAIT NSW Malvern MALV VIC Manly MANL NSW Maroubra MARO NSW Mascot MASC NSW Matraville MATR NSW Mayfield MAYF NSW Maylands MAYM WA Mitchelton MCHN QLD Modbury MDBY SA Midland MDLD WA Maida Vale MDLE WA Medina MDNA WA Menai MENA NSW Mount Gravatt MGAT QLD Mount Hawthorn MHAW WA Mildura MILD VIC Miller MILL NSW Minto MINT NSW Miranda MIRA NSW Mitcham MITM VIC Mackay MKAY QLD Melba MLBA ACT Morley MLEY WA Moreland MLND VIC Mordialloc MLOC VIC Mullaloo MLOO WA Mindarie MNDE WA Manuka MNKA ACT Manning MNNG WA Monash MNSH ACT Moolap MOLP VIC Mona Vale MONA NSW Mosman MOSM NSW Merrimac MRAC QLD Mount Eliza MTEA VIC Mawson MWSN ACT Maroochydore MYDE QLD North Adelaide NALE SA Narre Warren NAWN VIC Northbridge NBRI NSW Northcote NCOE VIC Nundah NDAH QLD Nudgee NDGE QLD Nedlands NDLN WA Nerang NERG QLD North Essendon NESS VIC Newtown NEWT NSW North Geelong NGLG VIC New Lambton NLTN NSW North Melbourne NMEL VIC Newmarket NMKT QLD Noosa Heads NOOS QLD North Parramatta NPAR NSW Newport NPRT VIC Narangba NRBA QLD Norwood NRWD SA North Ryde NRYD NSW North Sydney NSYD NSW New Farm NWFM QLD Oakleigh OAKL VIC Orange ORGF NSW Ormond ORMD VIC Parramatta PARR NSW Paddington PDTN QLD Peakhurst PEAK NSW Pendle Hill PEND NSW Pennant Hills PENN NSW Petersham PETE NSW Petrie PETR QLD Port Kembla PKEM NSW Port Melbourne PMEL VIC Palmyra PMYA WA Penrith PNTH NSW Paradise PRDS SA Prospect PROT SA Preston PRTN VIC Port Adelaide PTAD SA Pymble PYMB NSW Quinns Rocks QINS WA Quakers Hill QUAK NSW Ramsgate RAMS NSW Randwick RAND NSW Robina RBNA QLD Richmond RCMD VIC Redcliffe REDC QLD Redfern REDF NSW Reynella RELA SA Revesby REVE NSW Riverton RIVT WA Rockingham RKHM WA Rockdale ROCK NSW Rooty Hill ROOT NSW Rose Bay ROSE NSW Reservoir RSVR VIC Rothwell RTWL QLD Ringwood RWOD VIC Rydalmere RYDA NSW Ryde RYDE NSW Salisbury SALA SA St Albans SALB VIC Scarborough SCBH WA Scullin SCLN ACT Scoresby SCOY VIC Seaford SEAF VIC Seaford SEFD SA Sefton SEFT NSW Semaphore SEMC SA Seven Hills SEVE NSW Shalvey SHAL NSW Shepparton SHPN VIC Silverwater SILV NSW Slacks Creek SLAC QLD South Melbourne SMEL VIC South Morang SMRN VIC Sandringham SNDM VIC South Oakleigh SOAK VIC Southport SOPT QLD South Brisbane SOTH QLD Springvale SPLE VIC Strathpine SPNE QLD Sebastopol SPOL VIC Spearwood SPRD WA South Perth SPTH WA Saratoga SRTA NSW Sherwood SRWD QLD Salisbury SSBY QLD South Strathfield SSTR NSW Stirling STIC SA St John STJN TAS St Kilda STKA VIC St Leonards STLE NSW St Marys STMA NSW St Marys STMF SA St Peters STPE SA Subiaco SUBT WA Surfers Paradise SURF QLD Sutherland SUTH NSW Sunnybank SYBK QLD South Yarra SYRA VIC Tamworth TAMH NSW Tingalpa TGPA QLD The Gap THGP QLD Thomastown THTN VIC Tullamarine TMNE VIC Thornbury TNBY VIC Tarneit TNIT VIC Townsville TNSF QLD Toowoomba TOBF QLD Toorak TRAK VIC Toronto TRTO NSW Tuart Hill TUTT WA Toowong TWOG QLD Tally Ho TYHO VIC Undercliffe UNDE NSW Unley UNLY SA Vaucluse VAUC NSW Victoria Park VICP WA Valley VLLY QLD Wacol WACL QLD Wagga Wagga WAGA NSW Wahroonga WAHR NSW Wanneroo WANO WA Waverley WAVE NSW Woodville WDVL SA Wendouree WEND VIC Wellington Point WEPN QLD West Adelaide WESA SA Wetherill Park WETH NSW Whyalla Jenkins WHJS SA Wheelers Hill WHLL VIC Willoughby WILL NSW Windsor WIRC VIC Wollongong WLGG NSW Wembley WMBY WA Woolloongabba WOBB QLD Wolfe WOLF NSW Woy Woy WOYY NSW Warilla WRLA NSW Wantirna WRNA VIC Waterford WTFD QLD Wynnum WYNM QLD Yeronga YRGA QLD Zillmere ZMRE QLD ATTACHMENT B - SPARE CAPACITY REPORTING INFORMATION 1 Information provided by an ULLS-based competitor under paragraph (a) of the ULLS Spare Capacity definition in clause 4 of this Order must: (a) be current as at the relevant Ascertainment Date; (b) be provided to the Commission within 28 business days after the relevant Ascertainment Date; (c) be prepared and submitted in Microsoft Excel format using the template at Table 1: Spare Capacity Reporting Template; (d) be provided to the Commission on CD-ROM, either: (i) by post to the attention of: Group General Manager Communications Group ACCC PO Box 520 Melbourne 3001 Victoria; or (ii) by hand delivery: to the attention of: Group General Manager Communications Group ACCC 360 Elizabeth Street Melbourne. and be accompanied by the original of a statutory declaration, made under the Statutory Declarations Act 1959 (Cth) and sworn by its proper officer, attesting to the accuracy and completeness of the information; and (e) also be provided to the Commission electronically by email addressed to CommsExemptions@accc.gov.au. 2 The formats referred to in 1(b), (c)(i), (c)(ii) and (d) may be amended by the Group General Manager of the Communications Group from time to time. The Commission shall provide notice of any such amendment on its website. 3 Unless otherwise defined in the Order the column headings have the same meaning as in the CAN RKR. Table 1: Spare Capacity Reporting Template ESA Code Number of DSLAMs installed DSLAM Capacity ATTACHMENT C - TELSTRA REPORTING INFORMATION 1 Information required to be provided by Telstra under this Order in order to calculate Aggregate Market Share or Deemed Capacity, must: (a) be current as at the relevant Ascertainment Date; (b) be provided to the Commission within 28 business days after the relevant Ascertainment Date; (c) be prepared and submitted in Microsoft Excel format using the template at Table 1: Telstra Reporting Template; (d) be provided to the Commission on CD-ROM, either: (i) by post: to the attention of: Group General Manager Communications Group ACCC PO Box 520 Melbourne 3001 Victoria; or (ii) by hand delivery: to the attention of: Group General Manager Communications Group ACCC 360 Elizabeth Street Melbourne. and be accompanied by the original of a statutory declaration, made under the Statutory Declarations Act 1959 (Cth) and sworn by its proper officer, attesting to the accuracy and completeness of the information; and (e) also be provided to the Commission electronically by email addressed to CommsExemptions@accc.gov.au. 2 The formats referred to in 1(b), (c)(i), (c)(ii) and (d) may be amended by the Group General Manager of the Communications Group from time to time. The Commission shall provide notice of any such amendment on its website. 3 Unless otherwise defined in the Order the column headings have the same meaning as in the CAN RKR. Table 1: Telstra Reporting Template ESA Code WLR SIO IN THE AUSTRALIAN COMPETITION TRIBUNAL File No 6 of 2008 RE: APPLICATION UNDER SECTION 152AV OF THE TRADE PRACTICES ACT 1974 FOR A REVIEW OF EXEMPTION ORDER DECISIONS (INDIVIDUAL EXEMPTION ORDERS 5 AND 6 OF 2008) MADE BY THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION UNDER SECTION 152AT(3)(a) OF THAT ACT IN RESPECT OF THE SUPPLY BY TELSTRA CORPORATION LIMITED OF THE PSTN ORIGINATING ACCESS SERVICE BY: AAPT LIMITED, AGILE PTY LTD, CHIME COMMUNICATIONS PTY LTD, MACQUARIE TELECOM PTY LIMITED, POWERTEL LIMITED AND PRIMUS TELECOMMUNICATIONS PTY LIMITED Applicants TRIBUNAL: JUSTICE FINKELSTEIN (president) R davey professor d round DATE: 9 SEPTEMBER 2009 WHERE MADE: MELBOURNE REASONS FOR DETERMINATION 1 On 24 August 2009 the Tribunal provided the parties with confidential reasons for determination (Application by AAPT Limited [2009] ACompT 5) and the draft orders by which it proposed to grant Telstra Corporation Limited (Telstra) exemption from the standard access obligations in s 152AR of the Trade Practices Act 1974 (Cth) (the Act) in respect of the public switched telephone network originating access (PSTN OA) service. An intervener in the proceedings, Optus Networks Pty Ltd (Optus), has asked the Tribunal to include as an extra condition of the exemption what has been called the "pair gain" condition. Telstra opposes that course. The Tribunal will not impose the pair gain condition for reasons which now follow. 2 It is necessary to explain the background. Telstra made applications for exemption in respect of 380 metropolitan exchange service areas (ESAs) (the metropolitan application) and 17 ESAs that are located in Australian central business districts (CBD application). The metropolitan ESAs are the same ESAs that were the subject of Telstra's exemption applications in relation to two other declared services, the wholesale line rental (WLR) service and the local carriage service (LCS) (the WLR/LCS applications): see Application by Chime Communications Pty Ltd (No 2) [2009] ACompT 2. The Tribunal granted the WLR/LCS applications subject to a number of conditions and limitations: see Application by Chime Communications Pty Ltd (No 3) [2009] ACompT 4. The submissions that Telstra put in support of its metropolitan application were substantially the same as those relied on in its WLR/LCS applications. At the heart of the WLR/LCS applications was that another declared service, the unconditioned local loop service (ULLS), is an effective substitute for the LCS and WLR service. In the current application, the essence of the submission is that the ULLS is an effective substitute for the PSTN OA service. 3 In granting exemptions in the WLR/LCS applications, the Tribunal considered whether it was appropriate to impose a pair gain condition. The reason the Tribunal considered the imposition of a pair gain condition is that if a line is affected by a pair gain system, the ULLS cannot be provided over that line: Chime (No 2) at [123]. 4 Initially, the Tribunal was of opinion that it should impose a pair gain condition in the WLR/LCS exemption orders. It said (Chime (No 2) at [156]): "Having regard to the significant number of SIOs [services in operation] that are, and may be, affected by pair gain systems, the Tribunal is not satisfied that it would be in the long-term interests of end-users for the matter to be addressed simply as an MES [minimum efficient scale] issue. It is appropriate that there be a condition to the effect that the exemptions do not apply to an SIO in respect of which an end-user cannot be supplied by way of the ULLS". 5 Following its decision in Chime (No 2), the Tribunal provided its draft exemption orders on the WLR/LCS applications to the parties for their comment. The draft orders included a pair gain condition. Telstra made submissions regarding the cost and difficulty of implementing the pair gain condition. After considering Telstra's submission, the Tribunal said (Chime (No 3) at [24]): "Telstra objected to the imposition of … a [pair gain] condition principally for the reason that it would be enormously complex, costly and impracticable, and that any benefit to be derived from the condition would be outweighed by those costs and difficulties. Notwithstanding what was said in Chime (No 2), in light of this submission, the Tribunal accepts that the imposition of the condition would be disproportionately expensive." 6 Accordingly, the final exemption orders in the WLR/LCS applications did not include a pair gain condition. 7 The Tribunal is of opinion that the reasons which led it to grant exemptions in the WLR/LCS applications apply equally to the metropolitan application. It is for that reason the draft exemption order on the metropolitan application is, in almost all respects, in the same terms as the orders in the WLR/LCS applications. 8 Optus contends that in declining to impose a pair gain condition the Tribunal acted in breach of s 154AW(4) of the Act. That section provides that for purposes of a review the Tribunal may only have regard to "information given, documents produced or evidence given to the [Australian Competition and Consumer Commission (ACCC)] in connection with the making of the decision to which the review relates". Optus says that there was "no material before the Tribunal upon which it could be properly satisfied that the imposition of such a condition 'would be enormously complex, costly and impracticable'" (emphasis as in original) and to rely on a submission on that score infringed the statute. 9 There are three reasons why the Tribunal has decided not to impose a pair gain condition in the metropolitan application. First, the Tribunal is entitled to draw on its own knowledge of particular industries and also to draw appropriate inferences from that knowledge for purposes of arriving at a decision. On the basis of its knowledge, and as a matter of common sense, the Tribunal accepts that it will be complex and costly for Telstra to implement the pair gain condition. 10 Second, the Tribunal said (Application by AAPT Limited at [36]) that "inconsistent decisions [in the metropolitan application and the WLR/LCS applications] would frustrate the achievement of the benefits intended by the Tribunal to be achieved in respect of the exemptions granted on the WLR/LCS applications". Optus has not persuaded the Tribunal otherwise. The need for regulatory consistency and certainty is important. To include a pair gain condition in the metropolitan exemption order but not in the WLR/LCS exemption orders would potentially: (a) undermine the operation of the WLR/LCS exemption orders; and (b) create regulatory uncertainty and distortions given that the LCS, WLR service and PSTN OA service are typically bundled in order that access seekers can supply a full suite of downstream voice services. 11 It follows that the Tribunal will not include a pair gain condition in the metropolitan exemption order. 12 The Tribunal now publishes its orders in both the metropolitan application and the CBD application. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Determination of the Australian Competition Tribunal. Associate: Dated: 9 September 2009 Solicitor for the Applicant: Herbert Geer Solicitor for Telstra Corporation: Mallesons Stephen Jacques Solicitor for Optus: Minter Ellison Solicitor for the Australian Competition and Consumer Commission: DLA Phillips Fox Date of written submissions of Optus: 3 September 2009 Date of written submissions of Telstra Corporation: 7 September 2009 Date of written submissions of the Australian Competition and Consumer Commission: 8 September 2009 Date of Determination: 9 September 2009