CallPlus takes New Zealand government to court

Summary:Telecommunications provider CallPlus is taking the New Zealand government to court over its review of copper broadband pricing.

On the same day that New Zealand Communications Minister Amy Adams announced an independent review of Chorus' finances following a Commerce Commission ruling that it must cut its copper broadband price, CallPlus is challenging an earlier review of the Telecommunications Act.

The government earlier this year ordered a review of rules governing the sector after the commission's draft ruling issued in December 2012, and it is this review that CallPlus is challenging.

It filed proceedings in the High Court, saying that the government's review did not comply with the Telecommunications Act.

It said a draft discussion document released by the government in August dealt only with the pricing of Chorus' copper broadband and voice services network, and failed to address any other matters mandated in Section 157AA of the Act.

"We have some concerns that the government has not taken into account a number of factors that will have a material impact on the competitive market and most importantly our customers," CallPlus chief executive Mark Callander said.

"The government should stop the consultation process, as it would be wrong to launch major new policy initiatives or legislation until this matter has been reviewed."

CallPlus is among those calling on the government to back the commission's ruling that Chorus cut the monthly access charge for its copper network from NZ$44.98 to NZ$34.44 per line.

Chorus said the decision would cut its revenue by NZ$142 million (AU$126.27 million) a year, would hamper its ability to borrow money, and therefore it wouldn't be able to complete the Ultra-Fast Broadband (UFB) rollout — one of the government's flagship policies.

Adams on Thursday ordered an independent review of Chorus' finances, wanting to know whether it can stick to its UFB commitments.

Topics: Broadband, New Zealand

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