Telecommunications Legislation Amendment (Competition and Consumer) Act 2020

The Telecommunications Legislation Amendment (Competition and Consumer) Act 2020 is a Commonwealth amending Act that changed several telecommunications laws at the same time. Its schedules deal with layer 2 bitstream services, local access lines, statutory infrastructure provider settings, funding of fixed wireless and satellite broadband, and NBN Co transparency.

For most businesses, the most important practical changes are in the rules for local access lines and superfast carriage services, the functional separation framework for certain network operators, and the linked funding framework for the Regional Broadband Scheme. The Act also contains commencement rules, transitional arrangements and a requirement for ACCC modelling and reporting in relation to the Regional Broadband Scheme.

This is not a general consumer internet law for all businesses. It is mainly relevant to businesses that build, own, control, operate or supply over telecommunications infrastructure, especially fixed-line infrastructure used to deliver superfast services to residential customers or prospective residential customers.

The Act is most relevant to a business if it controls a local access line, operates a local access network, supplies fixed-line carriage services to premises used by end users, or has both wholesale and retail operations in the same group. It is also relevant if the business is involved in residential developments, multi-unit buildings, estate fibre networks or other niche broadband networks that may fall within the local access line rules.

The legislation uses concepts such as local access line, local access network, fixed-line carriage service, wholesale customer, retail customer, wholesale business unit and retail business unit. Those concepts matter because the Act is aimed at how infrastructure controllers supply services and whether they are dealing with carriers and service providers at wholesale level or supplying directly to end users at retail level.

Businesses that simply buy broadband as end users are usually not directly regulated by these amendments. The main compliance burden falls on carriers, service providers, network controllers and related entities involved in supplying services over relevant infrastructure.

The first trigger point is whether the service is a superfast carriage service. The Act amended the definition so that the threshold is 25 megabits per second or more. That is an important detail. A business that previously assumed the rules only applied above 25 Mbps should revisit that assumption.

The second trigger point is whether the business controls a local access line that is part of the infrastructure of a local access network. The Act inserted a definition of local access line into the Telecommunications Act 1997 and clarifies that the line does not include the part on the customer side of the telecommunications network boundary.

The third trigger point is timing. The simplified outline inserted into Part 8 distinguishes between lines that came into existence, or were upgraded, on or after the designated commencement date, and certain networks that came into existence, or were upgraded, on or after 1 January 2011 but before the designated commencement date. The designated commencement date for Schedule 2 was 25 August 2020.

The fourth trigger point is customer type and use. The rules focus on superfast carriage services supplied wholly or principally to residential customers, or prospective residential customers, in Australia.

The fifth trigger point is whether a functional separation undertaking is in force. If not, the controller may be restricted from using the line to supply an eligible service to a person other than a carrier or a service provider in the circumstances covered by Part 8.

The Act makes the wholesale versus retail distinction much clearer. It introduces and uses concepts such as wholesale business unit, retail business unit, wholesale customer and retail customer. In broad terms, a wholesale customer is a carrier or service provider, while a retail customer is a customer other than a wholesale customer.

The practical effect is that a controller of relevant local access line infrastructure is generally expected to operate on a wholesale basis unless it has an appropriate functional separation undertaking in force. The legislation contemplates both standard functional separation undertakings and joint functional separation undertakings. It also states that a reference to a functional separation undertaking given by a person includes one given by that person alone or jointly with one or more others.

For a vertically integrated business, this is not just a paperwork issue. Functional separation is about how wholesale and retail functions are organised and how they deal with each other. The Act expressly says that functional includes organisational. Businesses should therefore review not only legal entities and contracts, but also business units, ordering systems, provisioning, billing, service activation and fault rectification interfaces where those are relevant to local access line services.

If your business controls infrastructure and also sells to end users, you should check whether your current operating model assumes direct retail supply in circumstances where the Act expects wholesale-only supply unless an undertaking is in force. That is often the key compliance question.

Schedule 2 moved the local access line rules into the Telecommunications Act 1997 and also amended the Carrier Licence Conditions (Networks supplying Superfast Carriage Services to Residential Customers) Declaration 2014. The amendments preserve a transitional pathway for some older networks, but only within stated limits.

The amended declaration refers to networks that came into existence before the designated commencement date and have not been altered, upgraded or extended on or after that date, where no functional separation undertaking given by the carrier is in force. This means a business with a pre-existing network should not assume it can ignore the new framework forever. A later alteration, upgrade or extension may change the analysis.

The Act also contains a transitional election mechanism allowing a corporation included in a class specified in a determination made before Schedule 2 commenced to elect, before commencement, to be bound by the determination. In addition, certain exemption instruments in force immediately before commencement continue with modified effect under the amended provisions.

For businesses with older estate networks, apartment fibre systems or private broadband infrastructure, the safest approach is to map the network timeline carefully. Record when the network came into existence, whether any line or network was upgraded, and whether any extension or alteration occurred on or after 25 August 2020.

The Act includes a specific requirement for the ACCC to prepare a report in relation to the Regional Broadband Scheme. The report must include updated costings using the same model and methodology previously used by the Bureau of Communications Research, but with updated inputs and assumptions. The report must estimate losses incurred and likely to be incurred by NBN Co in relation to fixed wireless broadband and satellite broadband matters, and estimate the amount of the base component that would be required in certain scenarios.

The report must also include the total expected number of chargeable premises for the financial year beginning on 1 July 2025, specify aggregated data inputs and modelling assumptions, be given to the Minister within 150 days of commencement of the section, and be published on the ACCC website. The Minister must then table it in Parliament.

For businesses, the practical point is that this Act forms part of the broader Regional Broadband Scheme framework rather than standing alone. The actual charge framework sits with the Telecommunications (Regional Broadband Scheme) Charge Act 2020 and related provisions. If your business may be liable to contribute because of chargeable premises or the kinds of services you supply, you need to read the linked legislation together rather than relying on this Act in isolation.

The Act also states that the use of the word Regional in this section does not limit the relevant provisions of the Telecommunications (Consumer Protection and Service Standards) Act 1999 or the Regional Broadband Scheme Charge Act. That is another sign that businesses should treat the funding rules as an integrated legislative package.

In addition to local access line and funding changes, the Act includes Schedule 5 dealing with NBN Co transparency and Schedule 3 dealing with statutory infrastructure providers and related matters. The Act also repealed or amended a range of earlier provisions and declarations, including some carrier licence condition declarations applying to named entities.

For many businesses, these parts will matter less than the local access line rules unless they operate directly in the wholesale broadband market or interact closely with NBN Co and statutory infrastructure provider settings. Even so, they are part of the same reform package and may affect how the market is regulated, how information is reported, and how obligations are allocated across different network models.

If your business relies on older compliance manuals or advice prepared before mid-2020, it is worth checking whether those materials still refer to repealed provisions, old declarations or the pre-amendment superfast threshold.

The Act received Royal Assent on 25 May 2020. Sections 1 to 5 commenced on that date. Schedule 1 commenced on 26 May 2020. Schedule 2, which contains the key local access line amendments, commenced on 25 August 2020. Schedule 3 Part 1 Division 1 commenced on 26 May 2020, while Schedule 3 Part 1 Division 2 and Part 2 commenced on 1 July 2020. Schedules 4 and 5 commenced on 26 May 2020.

The Act is in force. Because it is an amending Act, businesses should also read the current consolidated versions of the amended legislation, especially the Telecommunications Act 1997 and the linked Regional Broadband Scheme legislation, before making compliance decisions.

Before relying on this page, a business should confirm exactly what infrastructure it controls, whether the relevant service is fixed-line and superfast, whether the service is supplied wholly or principally to residential customers or prospective residential customers, and whether any functional separation undertaking is in force. It should also check whether the infrastructure is part of the national broadband network, because the simplified outline in Part 8 distinguishes those lines from other local access lines.

Businesses should also review the current text of the Telecommunications Act 1997, any applicable carrier licence conditions or service provider rules, and the Telecommunications (Regional Broadband Scheme) Charge Act 2020 if Regional Broadband Scheme contributions may be relevant. If your network has a long history, map the dates of creation, upgrade, alteration and extension carefully. Transitional treatment often turns on those facts.

Finally, if your business has both wholesale and retail operations, review the practical operation of those business units, not just the corporate chart. The legislation is concerned with how services are supplied in practice.