How do we keep NBN Co fair, asks ACCC

The Australian Competition and Consumer Commission (ACCC) is calling for industry comment on how it should best ensure that the National Broadband Network Company (NBN Co) and other wholesale providers do not favour one provider over another.

The ACCC can, as regulator, impose fines on layer two wholesale broadband providers or stop them from offering access if they discriminate between the retail providers buying from them.

Although NBN Co is required under legislation to comply with Standard Access Obligations in most instances, the company could discriminate under certain circumstances; for example, if an access seeker has "aided efficiency" for NBN Co.

Aiding efficiency has been determined by some to mean volume discounts for internet services providers with large customer bases, such as Telstra or Optus. Although amendments to legislation have ruled out volume discounts, both Telstra and Optus have argued that if they are able to reduce operating costs for NBN Co, then that should be reflected in lower costs in the agreements between the telcos and NBN Co.

In areas where the level of service given by NBN Co varies between providers, NBN Co must provide the ACCC with a statement on how the terms and conditions for the special access seeker differ to standard terms and conditions.

If NBN Co or other providers are found to be breaching the non-discrimination provisions, they can face injunctions and fines of up to $10 million for each breach.

In an issues paper released yesterday(PDF), the ACCC has called for industry comment on what the regulator should consider to be discriminatory activity, and what activity should be exempt from the non-discrimination provisions. Comments are open until 8 August, with the ACCC to publish final explanatory material by the end of 2011.

"This issues paper provides an important opportunity for all stakeholders to express their views on the operation of the non-discrimination provisions and the guidance the ACCC should provide within its explanatory material," ACCC chair Graeme Samuel said. "The guidelines that the ACCC are developing will serve as an important part of the framework for a fair and level playing field across the NBN and super-fast telecommunication networks."