Commission revises draft Telecommunications Development Levy

Commission revises draft Telecommunications Development Levy paper

Issued 24 April 2014
Release No. 98

The Commerce Commission today released a revised draft determination for the amount 22 telecommunications providers will pay towards the $50 million Telecommunications Development Levy (TDL) for 2012/13.

This revision to the draft determination results from the Commission’s review of companies’ compliance with revenue reporting, and also provides telecommunication providers with an opportunity to comment on two technical matters of relevance to levy allocations.

The government uses the annual levy to pay for telecommunications infrastructure including the relay service for the deaf and hearing-impaired, broadband for rural areas, and improvements to the 111 emergency service.

The levy, about 1% of revenue, is paid by companies, or groups of companies, earning more than $10 million per year from operating a component of a public telecommunications network (fixed or wireless).

This revised draft explains the Commission’s method for determining the amount of levy payable by each provider. The method used is consistent with that used in the original draft determination in October 2013 and for the 2011/12 determination. To see the revised draft go to: www.comcom.govt.nz/201213-tdl-liability-allocation-determination

The Commission anticipates releasing its final determination for the 2012/13 TDL around the end of May 2014.

Background

The Telecommunications Development Levy was established by legislation in June 2011. The levy is set at $50 million a year until 2016, at which time it will be reduced to $10 million.

The TDL replaces the Telecommunications Service Obligations (TSO) liability allocation process and streamlines the process for industry contributions to the TSO, broadband for rural areas, and other government led improvements to New Zealand's telecommunications infrastructure.

The Commission is required to prepare an annual TDL liability allocation determination in accordance with subpart 2 of Part 3 of the Telecommunications Act 2001.

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