Part 2A of the Telecommunications Act 2001 requires the separation of Telecom into three or more business units, including an access, wholesale and one or more retail business units, required to supply certain relevant services to both external and internal customers on a non-discriminatory and equivalent basis.
The Act requires that equivalence be delivered on an Equivalence of Inputs (EOI) basis, meaning that, where Telecom is required to provide service providers with a relevant service, Telecom must:
- consume the same relevant services as inputs in the provision of specified wholesale and retail services;
- on the same terms and conditions (including price);
- using the same systems and processes, within the same time periods;
- with access to the same data and commercial information.
Telecom agreed the Undertakings with the Crown in a legally enforceable deed and, on 31 March 2008, a business unit to supply access services, Chorus, and a wholesale unit to supply various wholesale services, Telecom Wholesale, were established as part of the Separation Undertakings. (Undertakings).
The Undertakings include enforceable milestones that Telecom must meet over a defined period in order to fully implement equivalence. There are specific migration plans for relevant access and wholesale services to be supplied on a fully equivalent basis by 31 December 2011. Additionally the Undertakings include a specific migration path with set milestones to allow at least 80 per cent of PSTN lines to be high speed broadband capable by 2012.
Telecom's compliance with their Undertakings is primarily monitored by an independent oversight group (IOG) which reports to the Commission and the Telecom Board under conditions prescribed in the Undertakings.
The Commission has the overall role of monitoring the broader effects of the separation arrangements as well as using information from the IOG, Telecom and other sources to identify either breaches or the potential for breaches of the Undertakings. The Commission has the explicit role of enforcing compliance with the Act and can make recommendations to the Minister for Communications and Information Technology if it considers variations and exemptions to the Undertakings are required.
The Telecommunications Act provides a process for the Undertakings to be varied. Telecom has requested four variations, three of which have been agreed to by the Minister. All public submissions can be found on the MED website.
Telecom compliance with the Undertakings (UBA with SLES)
You are viewing these pages in the online archive.
On 15 October 2010, the Commerce Commission launched an investigation into an alleged breach of the Separation Undertakings by Telecom to ascertain whether the terms on which the unbundled bitstream access (UBA) service (when taken in conjunction with the Sub-loop Extension Service (SLES)) is provided are discriminatory.
Telecom Wholesale Loyalty Offer Investigation
In July 2010 the Commerce Commission reached a $1.6 million settlement with Telecom Corporation of New Zealand Limited. The settlement followed a Commission investigation launched after receiving complaints from the telecommunications industry alleging that Telecom Wholesale's 'loyalty offers' breached Telecom's Separation Undertakings.
Implementation of the Undertakings
The Separation Undertakings include milestones that must be met over a defined period if the overall objectives are to be delivered on.
Commission Guidance on Non-Discrimination Obligations under the Telecom Separation Undertakings
The guidance was intended to:
- assist in meeting non-discrimination obligations under the Undertakings;
- provide certainty to access seekers that service providers will treat them in a non-discriminatory manner in the provision of relevant services; and
- provide transparency to industry and other stakeholders interested in the effective implementation of the Undertakings.
In 2009, the Commission consulted on the meaning of Telecom's non-discrimination obligations under the operational separation undertakings. The Commission has published its overview of the non-discrimination obligations under the operational separation undertakings below.
The operational separation undertakings have now been removed from the Telecommunications Act 2001 under the 2011 amendments to the act.
Variations to the Undertakings
The Telecommunications Act provides a process for the Undertakings to be varied. Telecom has requested four variations, three of which have been agreed to by the Minister. All public submissions can be found on the MED website.
Correspondence
Includes a request for information on 2010/11 OTIF (On Time and In Full).
