Share
- Release Date: 11/12/13 10:54
- Summary: GENERAL: CNU: Commission initiates review of UCLFS connection charges
- Price Sensitive: No
- Download Document 2.71KB
CNU
11/12/2013 08:54
GENERAL
REL: 0854 HRS Chorus Limited (NS)
GENERAL: CNU: Commission initiates review of UCLFS connection charges
MEDIA RELEASE
11 December 2013
Commission initiates review of UCLFS connection charges
The Commerce Commission has today initiated a review of the regulated
unbundled copper low frequency service (UCLFS) and released a draft decision
updating the connection charges Retail Service Providers (RSPs) pay to
connect end users to Chorus' UCLFS (UCLFS connection charges). RSPs
currently pay UCLFS connection charges, in addition to ongoing monthly
rentals for accessing these services.
The Commission has determined that UCLFS connection charges should be re-set
so that they are the same as benchmarked UCLL connection charges (determined
by the Commission as part of the initial UCLL benchmarking decision released
in December 2012). The Commission has also proposed that the new UCLFS
connection charges be backdated so that they apply from the date of its
initial UCLL decision - 3 December 2012.
The Commission's draft decision, if implemented, will reduce UCLFS connection
charges by between 5.8% and 31.1%. Chorus' very initial estimate is that the
decision, if finalised, would have around a $5 - 6 million annualised EBITDA
impact.
The Commission can initiate a review of any of Chorus' regulated service at
any time.
"This is yet another example of the regulatory framework delivering prices
that are disconnected from real costs," Mark Ratcliffe, Chorus CEO, said.
"The Commission has proposed re-setting UCLFS connection charges based on the
benchmarking of connection charges for local loop unbundling in other
countries. Why wouldn't they look at the actual prices that Chorus pays to
service companies and which are negotiated through a competitive tender
process. These costs have not been accounted for in the proposed charges and
the draft prices do not reflect those real costs."
"Whilst many things in the world of telecommunications regulation are
difficult to explain, this isn't. The person in the van needs to do some
work, the cost for the service is a factor of how long it takes to do the
work and how much they charge per hour. Do we really need to benchmark
against international countries, when the answer is right here in front of us
in New Zealand?" he said.
Submissions on the draft decision are due on 10 January 2014.
The Commission's release and determination are attached.
ENDS
For further information:
Ian Bonnar
Corporate Affairs Manager
Phone: +64 9 358 6061
Mobile: +64 (27) 215 7564
Email: [email protected]
Brett Jackson
Investor Relations Manager
Mobile: +64 (27) 488 7808
Email: [email protected]
End CA:00245003 For:CNU Type:GENERAL Time:2013-12-11 08:54:52
