Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698752796492.pdf (New Zealand)
Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Government Bill Explanatory note General policy statement Context In September 2009, the Minister of Communications and Information Technology announced a policy programme of key reforms to the telecommunications sector to create a step-change in the provision of broadband services in New Zealand.
The key initiatives within that programme are: • the Ultra-fast Broadband (UFB) Initiative: a competitive ten- der programme to develop fibre-to-the-premises broadband networks connecting 75% of New Zealand households, with the support of $1.5 billion of Crown investment funding: the Rural Broadband Initiative (the RBI): a competitive tender programme to develop enhanced broadband infrastructure in non-urban areas of New Zealand, with the support of $300 million of Crown grant funding: the Telecommunications Service Obligations (TSO) frame- work reforms: a set of reforms to the legislative framework that supports the establishment, administration, and funding of “TSO instruments” that provide for the delivery of telecom- • • 250—1 2 • Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Explanatory note munications services that may not otherwise be supplied on a commercial basis: complementary measures to facilitate the deployment of broadband infrastructure: a package of Government meas- ures to streamline the technical and administrative procedures for the construction and deployment of broadband infrastruc- ture.
In conjunction, these initiatives will advance the Government’s ob- jective of improving the availability and quality of key telecommu- nications services across New Zealand.

The Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill (the Bill) amends the Telecommunications Act 2001 (the Act) to support the implementation of the Government’s policy programme for the telecommunications sector.
The Bill achieves this intent by providing for amendments to— • • streamline the administration of TSO instruments: consolidate the statutory mechanisms for industry funding of telecommunications service and sector development obliga- tions: establish a regulatory framework for the enhanced broadband networks that will be developed under the UFB Initiative and the RBI with the support of Crown funding.
• Depending on the forthcoming results from the UFB Initiative and RBI competitive tender processes, some additional legislative amendments may also be required in support of the Government’s initiatives, in the following areas: • access rights to multi-unit complexes, private land, and the road reserve when constructing or maintaining telecommuni- cations networks: amendments to enable the structural separation of Telecom NZ in the event that Telecom is selected as a preferred supplier under the UFB Initiative and that it accordingly decides to pro- ceed with a demerger of its access network business: other amendments to support the implementation of the Gov- ernment’s telecommunications policy programme.
• • Accordingly, the Government will consider these policy issues, in light of the UFB Initiative and RBI outcomes and may introduce a Explanatory note Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill 3 Government supplementary order paper containing the requisite le- gislative amendments during Parliament’s consideration of the Bill.
Overview of the Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 Part 1 of the Bill contains amendments to Part 3 of the Act, which sets out a legislative framework for the declaration and management of TSO instruments.

These instruments are service agreements between the Crown and a service provider for the delivery of telecommunica- tions services that would not otherwise be delivered on a commercial basis or at an affordable price.
The Bill— • amends the basis for calculation of the net cost of deemed TSO instruments, including the Telecommunications Service Obli- gations (TSO) Deed for Local Residential Telephone Service (the Local Service TSO) provided by Telecom, to ensure that the full benefits a provider accrues from provision of the re- quired services are considered when determining whether ad- ditional compensation should be paid to the provider; and streamlines the legislative funding mechanisms for TSO in- struments by introducing a new Telecommunications Devel- opment Levy (the TDL), which will be collected from indus- try participants annually and be used for the payment of TSO- related compensation, non-urban telecommunications infras- tructure development, and upgrades to the emergency services calling system.
The Bill also introduces amendments to— • require a determination of TSO instrument cost (where the amount payable is not specified in the instrument) only where a TSO provider requests one: broaden the definition of liable person, which is used to iden- tify those persons that are required to contribute toward the TDL, to ensure it accommodates the technology shift to Inter- net Protocol-based networks: simplify and clarify the existing processes in Part 3 of the Act: • • • 4 • Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Explanatory note address consequential and transitional issues raised by the amendment of the TSO framework.
Part 2 Part 2 of the Bill contains amendments to insert a new Part 4AA in the Act to establish a regulatory framework for the telecommunica- tions networks that will be developed under the UFB Initiative and the RBI, the construction of which will be funded, in whole or part, by the Crown.
The key legislative amendments to this effect— • establish a statutory framework enabling the Minister of Com- munications and Information Technology to accept binding “open access” undertakings from service providers regarding the application of non-discrimination and equivalence rules in the provision of wholesale telecommunications services of- fered over infrastructure funded (in whole or part) by Crown grants or co-investment: where a service provider has had open access undertakings ap- proved, restrict the Telecommunications Commissioner from recommending regulation of access to the service provider’s fi- bre-to-the-premises (FTTP) access infrastructure until 31 De- cember 2019: establish a new information disclosure regime to require those service providers who qualify for forbearance from regulation of their FTTP access services to disclose information regard- ing network and service costs and characteristics to the Com- merce Commission.
• • Regulatory impact statement The Ministry of Economic Development produced 3 regulatory im- pact statements on 23 March 2010, 25 June 2010, and 29 July 2010 to help inform the main policy decisions taken by the Government relating to the contents of this Bill.
Copies of these regulatory impact statements can be found at— http://www.med.govt.nz/templates/MultipageDocument- • TOC____45397.aspx http://www.med.govt.nz/upload/75796/UFB%20Initia- tive-Amendment%20to%20Model.pdf • Explanatory note Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill 5 • • http://www.med.govt.nz/upload/75796/UFB%20Regula- tory%20Regime.pdf http://www.treasury.govt.nz/publications/informationre- leases/ris Clause by clause analysis Clause 1 is the Title clause.
Clause 2 is the commencement clause.

This Bill comes into force on the day after the date that it receives the Royal assent.

Clause 3 provides that the Bill amends the Telecommunications Act 2001.

Part 1 Telecommunications service obligations and general matters Subpart 1—Amendments to principal Act relating to telecommunications service obligations and general matters Clause 4 amends section 5, which is the interpretation section.
The amendments— • substitute a number of new definitions, including— • • • liable person, which is no longer defined in relation to a TSO instrument: net cost, which (in the case of a deemed TSO instru- ment) is no longer defined by reference to the net in- cremental cost of providing the service required by the TSO instrument to non-viable customers but by refer- ence to the net incremental cost of providing the service to all end-users connected to residential lines on 20 De- cember 2001 (the date that the Telecommunications Act 2001 came into force): TSO instrument or telecommunications service obli- gation instrument, to provide that the term includes a deemed TSO instrument.
Currently, the term is defined to include a deemed TSO instrument “to the extent that it applies”.

Consequential amendments are therefore 6 • • • Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Explanatory note made to certain provisions to clarify where these apply only to a deemed instrument or to an instrument that is declared to be a TSO instrument under section 70 (see clauses 7 to 10): insert a number of new definitions.
These include PTN (or public telecommunications network), which captures next generation Internet-based technologies as well as the existing concepts in the Act of PSTN (the public switched telephone network) and PDN (the public data network): consequentially repeal a number of definitions.

• Clause 5 amends section 10, which sets out the way in which the Commerce Commission (the Commission) is required to perform certain functions.
The amendments clarify— • the number of other members of the Commission, in addition to the Telecommunications Commissioner, who must make certain determinations and how those determinations are to be made: the number of other members of the Commission, in addition to the Telecommunications Commissioner, who must consider a proposed alteration to Schedule 1 (which relates to regulation of designated services and specified services) and support the recommendation included in the final report to the Minister on the proposed alteration: the views that must be included in a final report to the Minister on a proposed alteration to Schedule 1.
Clause 6 amends section 16(b) to allow a search warrant to be is- sued under section 98A of the Commerce Act 1986 for the purpose of obtaining information and documents requested by the Commis- sion under new sections 82(b) or 83(1)(a) but which have not been provided within the required time.

Clause 7 substitutes new section 71A.


This largely re-enacts exist- ing section 71A but makes changes consequential on the new defin- ition of TSO instrument and also consequential on new section 94J, which imposes the obligation to pay TSO-related compensation on the Crown rather than on liable persons in relation to the TSO instru- ment as under the current regime.

Clause 8 amends section 75 consequential on the new definition of TSO instrument.
Explanatory note Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill 7 Clauses 9 and 10 substitute new sections 76 and 77 respectively, con- sequential on the new definition of TSO instrument.

Clause 11 repeals subpart 2 of Part 3 (which relates to the annual procedure for determining the amounts payable by liable persons in relation to TSO instruments) and substitutes new subparts 2 and 2A of Part 3.
New subpart 2— • provides a procedure for the Commission to determine the amount of the new telecommunications development levy, specified for each financial year in new Schedule 3B, that each industry participant (within the definition of liable person) must pay to the Crown (new sections 81 to 88).

The deter- mination is referred to as a liability allocation determination.
New section 81 provides that the subpart does not apply to a liable person for a financial year if that person’s turnover for the preceding financial year was less than the specified turnover, which is defined in new section 80 as $10 million or the amount prescribed: imposes an obligation on each liable person to pay that amount to the Crown (new section 89): sets out what the Crown may use that money for (new section 90), which includes paying TSO-related compensation, pay- ing for non-urban telecommunications infrastructure develop- ment, and paying for upgrades to the emergency service call- ing system.
New subpart 2A— • sets out a procedure for the Commission to determine the amounts that the Crown must pay to providers of telecommu- nications services under TSO instruments (TSO providers) by way of compensation for the cost to those providers of fulfilling obligations under those instruments.
Key features of the procedure include the following: • • • the Commission must assess a TSO provider’s com- pliance with its TSO instrument and notify the TSO provider and the Minister of any non-compliance (new section 92): in the case of a TSO instrument that does not specify the amount payable by the Crown under the instrument each financial year,— • 8 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Explanatory note • • a TSO provider who wants to have the amounts that the Crown must pay to it under new section 94J (the TSO charges) determined for a financial year must notify the Commission that it wishes to invoke the procedure in new sections 94B to 94I for the preparation of a TSO cost calculation de- termination (new section 93).
If a TSO provider notifies the Commission under new section 93 and the Commission determines the TSO charges to be zero, the TSO provider must pay the costs of the Commission for preparation of the TSO cost calculation determination (new section 94).
If a TSO provider does not notify the Commis- sion under new section 93, the procedure in new sections 94B to 94I does not apply and the TSO charges are deemed to be zero (new section 94A): the TSO provider must provide calculations of net cost to the Commission (new section 94B).
Matters that must be taken into account and con- sidered for the purposes of that calculation and the Commission’s calculation of net cost for the purposes of draft and a final TSO cost calculation determination are set out in new section 94C: • the Commission must prepare and notify a draft TSO cost calculation determination and a final TSO cost cal- culation determination in accordance with requirements set out in new sections 94D to 94I: requires the Crown to pay the TSO provider the TSO charges set out in the Commission’s final TSO cost calculation de- termination, and provides for the payment of interest on any amount unpaid within the time specified (new section 94J).
• Clause 12 repeals section 99, which relates to liable persons iden- tifying particular TSO instruments and allocating amounts to TSO instruments in their invoices, consequential on the repeal of subpart 2 of Part 3 and the substitution of new subparts 2 and 2A.
Explanatory note Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill 9 Clause 13 substitutes new section 100, which provides a right of ap- peal to the High Court, on a question of law, for— • a liable person, against the Commission’s determination of the amount of its qualified revenue for the purposes of a liability allocation determination: a TSO provider, against a direction of the Commission under new section 94(1) for the payment of costs for the preparation of a TSO cost allocation determination: a TSO provider or the Crown, against the Commission’s de- termination in respect of the matters set out in a TSO cost allo- cation determination in accordance with new section 94I(1)(a) to (g).
• • Clause 14 makes consequential amendments to section 100B, which relates to information about deemed TSO instruments that must be in- cluded in TSO cost calculation determinations for those instruments.

Clause 15 inserts new section 100BA.


The new section— • requires the Commission to include in a TSO cost calculation determination for a deemed TSO instrument information about a TSO provider’s spending of the TSO charges that it most recently received from the Crown: enables the Commission to require the TSO provider to prepare and provide information about the spending of TSO charges received.
• Clause 16 amends section 100C, which relates to duties of the Com- mission concerning the protection of confidentiality, to require the Commission to ensure that in complying with section 100B and new section 100BA it makes satisfactory provision for the protection of confidential or commercially sensitive information.

Clause 17 substitutes new section 101, which relates to the power to make regulations.
Clause 18 consequentially amends section 156A, which lists the pro- visions of the principal Act, and regulations made under that Act, in respect of which, if a person commits a breach of any of those pro- visions, the Commission may take enforcement action under section 156B.

Clause 19 makes the amendments to the principal Act that are listed in Schedule 1.
10 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Explanatory note Clause 20 inserts the new Schedule 3B that is set out in Schedule 2.

New Schedule 3B specifies the annual telecommunications develop- ment levy for financial year 2010/2011 and following financial years.

Subpart 2—Savings and transitional issues Clause 21 is a savings provision concerning TSO financial years up to and including the 2009/10 financial year.

Clause 22 is a transitional provision.


It provides that, for the purposes of the liability allocation determination for the 2010/2011 financial year, liable persons are those persons identified by the Commission in its final cost allocation determination for the financial year ended 30 June 2010 and whose turnover for that financial year is less than or equal to the specified turnover.
It also sets out how the qualified revenue of each of those liable persons is to be determined for the 2010/2011 financial year.

Clause 23 is a transitional provision that relates to the requirement in new section 100BA that the Commission disclose information about how a TSO provider has spent TSO charges it has received.

The pro- vision disapplies new section 100BA in respect of any TSO charges that a TSO provider receives before the 2010/2011 financial year.
Part 2 Telecommunications networks involving Crown funding Clause 24 inserts new Part 4AA (incorporating new sections 156AA to 156AZ).

The new Part— • enables the providers of wholesale telecommunications ser- vices that are provided using specified networks, or that provide access to unbundled elements of those networks, to give enforceable undertakings to the Crown providing for non-discrimination, equivalence, and other matters relating to the basis on which those services will be supplied.
The effect of new section 156AY, which sets out requirements for a network to be specified by the Governor-General by Order in Council as a network for the purposes of the Part, is that new Part 4AA will apply only to networks that are fibre-to-the-premises access networks (as defined in new Explanatory note Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill 11 • • section 156AB), or are related to the construction of broad- band infrastructure in non-urban areas, and that have been constructed with funding provided in whole or in part by the Crown or an entity specified in new Schedule 3C: precludes the Commission from recommending, in a final re- port delivered to the Minister before the close of 31 Decem- ber 2019, that particular services be added to Part 2 or 3 of Schedule 1 as a designated service or a specified service, if the access provider described for the service is a provider who has an undertaking in force under new Part 4AA (new section 156AR): requires service providers who have undertakings in force in relation to the particular services specified in new section 156AR to disclose information concerning costs and other matters relating to the provision of those services (new sub- part 3 of new Part 4AA).
Clause 25 consequentially amends section 156A, which lists the pro- visions of the principal Act, and regulations made under that Act, in respect of which, if a person commits a breach of any of those pro- visions, the Commission may take enforcement action under section 156B.

Clause 26 amends section 156L(1) to provide that the High Court may impose a pecuniary penalty for a failure to comply with an undertaking under new Part 4AA.

Clause 27 amends the heading to subpart 2 of Part 4A.
Clause 28 amends section 156N consequential on new section 156AS to— • include an undertaking under new Part 4AA in the definition of enforceable matter for the purposes of sections 156O to 156R, which set out how matters within that definition may be en- forced, and empower the High Court to order a person to pay a pecuniary penalty in addition to other available remedies: provide that a party to an enforceable matter includes any telecommunications service provider who is affected by a breach of an undertaking under new Part 4AA.
• 12 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Explanatory note • Clause 29 consequentially amends section 156O to— • provide that a party to an enforceable matter may make a com- plaint to the Commission alleging a breach of the undertaking under new Part 4AA: require the Commission, after receiving a complaint of breach an enforceable matter, to take into account the purpose (as set out in new section 156AC) of the undertakings regime in new Part 4AA subpart 2 when deciding whether to take the possible actions provided for in section 156O(2)(b), and to allow the Commission to take into account the financial means of the complainant when making that decision.
Clause 30 consequentially amends section 156P(2)(b) to provide for the Commission, on its own initiative, to enforce an undertaking under new Part 4AA by filing it in the Wellington Registry of the High Court.

The effect of the amendment is that an undertaking is then enforceable as a judgment of the High Court in its civil jurisdic- tion and the additional remedies for breach of an enforceable matter, set out in section 156Q, also apply.
Clause 31 makes the amendments to the principal Act that are listed in Schedule 3.

Clause 32 inserts the new Schedule 3C that is set out in Schedule 4.
Hon Steven Joyce Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Government Bill Contents Title Commencement Principal Act amended Part 1 Telecommunications service obligations and general matters Subpart 1—Amendments to principal Act relating to telecommunications service obligations and general matters Interpretation Performance of Commission’s functions Application of section 98A of Commerce Act 1986 New section 71A substituted 71A TSO instrument may specify total amount payable by Crown When instrument ceases to be TSO instrument Variation of TSO instrument or deemed TSO instrument New section 76 substituted 76 New section 77 substituted 77 New subparts 2 and 2A of Part 3 substituted Notification of TSO instrument 250—1 Page 6 6 6 6 8 9 9 9 9 9 9 10 10 10 1 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Subpart 2—Amounts payable by liable persons to Crown Annual procedure for determining amounts payable by liable persons to Crown Interpretation Subpart does not apply to certain liable persons Liable persons must produce information on turnover Liable persons must produce information for purposes of liability allocation determination Commission to prepare draft liability allocation determination Matters to be included in draft liability allocation determination Conferences on draft liability allocation determination Commission to prepare final liability allocation determination Matters to be included in final liability allocation determination Payment by liable persons to Crown General matters Crown use of amounts paid by liable persons Commission must notify final liability allocation determination before notifying TSO cost calculation determination Subpart 2A—TSO charges payable by Crown Assessment of compliance Assessment of compliance with TSO instrument TSO provider may request TSO cost calculation determination TSO provider under TSO instrument without specified amount may request TSO cost calculation determination TSO provider who
 requests TSO cost calculation determination liable for costs in certain circumstances TSO charges deemed to be zero if TSO provider does not request TSO cost calculation determination 94A 2 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Annual procedure for determining TSO charges payable by Crown Calculations of net cost and auditor’s report must be given to Commission Considerations for determining net cost Commission to prepare draft TSO cost calculation determination 94B 94C 94D 94E Matters to be included in draft TSO cost 94F 94G 94H 94I calculation determination Requirements for draft TSO cost calculation determination Conferences on draft TSO cost calculation determination Commission to prepare final TSO cost calculation determination Matters to be included in final TSO cost calculation determination Payment by Crown to TSO provider Right of appeal to High Court 94J Section 99 repealed New section 100 substituted 100 Commission must include information about deemed TSO instrument in TSO cost calculation determinations New section 100BA inserted 100BA Commission must include information about spending of TSO charges paid in relation to deemed TSO instrument Duties of Commission in complying with section 100B New section 101 substituted 101 Regulations Application of section 156B Further amendments to principal Act New Schedule 3B inserted Subpart 2—Savings and transitional issues Savings provision for financial years up to and including 2009/2010 financial year Transitional provision concerning liability allocation determination for 2010/11 financial year Transitional provision concerning information about deemed TSO instruments to be included in TSO cost calculation determinations Telecommunications (TSO, Broadband, and Other Matters)
 Amendment Bill Part 2 Telecommunications networks involving Crown funding 24 New Part 4AA inserted Part 4AA Undertakings regime for services provided using networks developed with Crown funding Subpart 1—Preliminary provisions 156AA Overview 156AB Interpretation Subpart 2—Undertakings 156AC Purpose Requirements for undertakings 156AD Main requirements for undertakings 156AE Further matters that may be included in undertakings 156AF Minister may determine further requirements for undertakings 156AG Minister may issue and consult on draft determination 156AH Procedural requirements for determination 156AI Variation of determination Process for submission and consideration of undertakings 156AJ Service provider must submit undertakings for approval by Minister 156AK Minister may approve or decline undertakings Implementation of undertakings 156AL Implementation of undertaking 156AM Service provider must publish undertaking Variation and termination of undertakings 156AN Variation of undertaking 156AO Procedure for variation of undertaking 156AP Undertaking that no longer meets requirements of determination ceases to have effect if not varied 156AQ Termination of undertaking 29 29 30 32 32 32 33 33 33 34 34 35 35 35 36 36 36 37 4 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Effect of undertakings in relation to certain relevant services 156AR Commission may not recommend certain services 37 be designated services or specified services if undertaking applies Enforcement of undertakings 156AS Enforcement and remedies under Part 4A 156AT Power of court to grant relief in respect of undertakings 156AU Interrelationship of remedies Subpart 3—Information disclosure by FTTP service providers with undertakings 156AV Purpose 156AW Commission must require disclosure by FTTP service providers 156AX Further powers of Commission relating to information disclosure Subpart 4—Miscellaneous 156AY Governor-General may declare specified networks 156AZ Power to amend Schedule
 3C Application of section 156B Pecuniary penalty Heading to subpart 2 of Part 4A amended Interpretation Complaints of breach of enforceable matter Enforcement by High Court Further amendments to principal Act New Schedule 3C inserted 25 26 27 28 29 30 31 32 Schedule 1 Further amendments to principal Act relating to telecommunications service obligations Schedule 2 New Schedule 3B inserted Schedule 3 Further amendments to principal Act relating to telecommunications networks involving Crown funding 38 38 39 39 40 41 42 42 42 43 43 43 43 44 44 44 45 46 47 5 cl 1 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Schedule 4 New Schedule 3C inserted 48 The Parliament of New Zealand enacts as follows: Title This Act is the Telecommunications (TSO, Broadband, and Other Matters) Amendment Act 2010.
Commencement This Act comes into force on the day after the date on which it receives the Royal assent.

Principal Act amended This Act amends the Telecommunications Act 2001.
Part 1 Telecommunications service obligations and general matters Subpart 1—Amendments to principal Act relating to telecommunications service obligations and general matters Interpretation Section 5 is amended by repealing the definitions of financial year, liable person, liable person’s TSO-qualified revenue, net cost, TSO instrument or telecommunications service obligation instrument, and TSO provider’s TSO-qualified revenue.
Section 5 is amended by inserting the following definitions in their appropriate alphabetical order: “CPI means the Consumers Price Index (All Groups) pub- lished by Statistics New Zealand “existing residential line means a Telecom residential line (other than a party line or a second line) that was an active connection on 20 December 2001 1 2 3 4 (1) (2) 6 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 4 “financial year means a period of 12 months beginning on 1 July in any year and ending on 30 June in the following year “liability allocation determination means a determination of the Commission prepared in accordance with section 87(1)(a) “liable person means a person who provides a telecommuni- cations service in New Zealand by means of some component of a PTN that is operated by the person “Ministry means the Ministry responsible for administering this Act “net cost,— “(a) in relation to an instrument that is declared to be a TSO instrument under section 70, means the unavoidable net incremental cost to an efficient service provider of pro- viding the service required by the TSO instrument to commercially non-viable end-users; and in relation to a deemed TSO instrument, means the un- avoidable net incremental cost to an efficient service provider of providing the service required by the TSO instrument to all end-users connected to existing resi- dential lines “(b) “new KSO has the meaning set out in section 71 “PTN or public telecommunications network— “(a) means a network used, or intended to be used, in whole or in part, by the public for the purpose of providing telecommunication: includes— “(i) “(ii) a PSTN: a PDN “(b) “qualified revenue means the revenue that a liable person re- ceives during a financial year for supplying either or both of the following (excluding any amount paid to the liable person by the Crown as compensation for the cost of complying with a TSO instrument that contains a specified amount): “(a) “(b) telecommunications services by means of its PTN:
 telecommunications services by means that rely primar- ily on the existence of its PTN or any other PTN 7 Part 1 cl 5 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “TSO charges means the amounts payable to a TSO provider by the Crown under section 94J(1) “TSO cost calculation determination means a determination of the Commission prepared in accordance with section 94H(1)(a) “TSO instrument or telecommunications service obligation instrument means— “(a) an instrument that is declared to be a TSO instrument under section 70: a deemed TSO instrument”.
“(b) Performance of Commission’s functions Section 10(1) is amended by repealing paragraphs (a) and (b) and substituting the following paragraphs: “(a) the Telecommunications Commissioner and no fewer than 2 other members of the Commission must— “(i) make every determination in respect of a desig- nated multinetwork service under section 39; and “(ii) make every pricing review determination under section 51; and “(iii) make every liability allocation determination under section 87; and “(iv) make every TSO cost calculation determination under section 94H; and “(b) “(ab) the determinations referred to in paragraph (a) must, if the Telecommunications Commissioner and the other members of the Commission are not unanimous in their view, be made in accordance with the majority view; and the Telecommunications Commissioner must report to the Minister about every proposed alteration to Sched- ule 1 in any of the ways set out in sections 66 and 67 fol- lowing consideration by the Telecommunications Com- missioner and no fewer than 2 other members of the Commission in accordance with clause 4 of Schedule 3, and— “(i) the recommendation included in the final report to the Minister must be supported by the ma- 5 8 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 9 jority of the Telecommunications Commissioner and the other members of the Commission; and the final report must include the majority view and any dissenting views; and”.
“(ii) 6 7 Application of section 98A of Commerce Act 1986 Section 16(b) is amended by omitting “section 81(a)” and sub- stituting “section 82(b) or 83(1)(a)”.

New section 71A substituted Section 71A is repealed and the following section substituted: “71A TSO instrument may specify total amount payable by Crown “(1) A TSO instrument may specify the total amount payable by the Crown under the instrument for each financial year (the specified amount).
“(2) The total amount may be specified as— “(a) “(b) “(c) “(d) “(e) a fixed monetary amount; or a capped monetary amount; or an indexed monetary amount; or a formula for the calculation of a monetary amount; or any combination of paragraphs (a) to (d).” 8 (1) (2) Variation of TSO instrument or deemed TSO instrument The heading to section 75 is amended by omitting “or deemed TSO instrument”.
Section 75(a) is amended by omitting “a TSO instrument” and substituting “an instrument that is declared to be a TSO instru- ment under section 70”.
9 New section 76 substituted Section 76 is repealed and the following section substituted: “76 When instrument ceases to be TSO instrument “(1) An instrument ceases to be a TSO instrument,— “(a) in the case of an instrument that is declared to be a TSO instrument under section 70, if the Governor-General, by Order in Council made on the recommendation of 9 Part 1 cl 10 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill the Minister, revokes the declaration of that TSO instru- ment; or in the case of a deemed TSO instrument, on a date ap- pointed by the Governor-General by Order in Council made on the recommendation of the Minister; or if the instrument is terminated in accordance with its terms.
“(b) “(c) “(2) The Minister must not make a recommendation under sub- section (1)(a) or (b) unless,— “(a) in the case of an instrument that is declared to be a TSO instrument under section 70, the service provider to whom that instrument applies agrees to the revoca- tion of the declaration; or in the case of a deemed TSO instrument, the service provider to whom that instrument applies agrees to that instrument ceasing to have effect as a deemed TSO in- strument.” “(b) 10 New section 77 substituted Section 77 is repealed and the following section substituted: “77 Notification of TSO instrument “(1) The Minister must notify the Commission of— “(a) “(b) every instrument that is declared to be a TSO instrument under section 70; and every deemed TSO instrument.
“(2) The Commission must give public notice of every TSO instru- ment.” 11 New subparts 2 and 2A of Part 3 substituted Subpart 2 of Part 3 is repealed and the following subparts are substituted: “Subpart 2—Amounts payable by liable persons to Crown “Annual procedure for determining amounts payable by liable persons to Crown “80 Interpretation In this subpart, unless the context otherwise requires,— 10 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 11 “financial statements,— “(a) “(b) except if section 79 applies, has the same meaning as in section 8 of the Financial Reporting Act 1993; and if section 79 applies, means a consolidated statement of financial performance of the 2 or more bodies corporate required by that section to be treated as 1 person, pre- pared in accordance with generally accepted accounting practice, as defined in section 3 of the Financial Report- ing Act 1993 “specified turnover means $10 million, or such other amount as may be prescribed by regulations made under section 101(1)(a) “turnover has the same meaning as in section 2 of the Finan- cial Reporting Act 1993 but, in a case to which section 79 ap- plies, the references in the definition to a group must be read as if they were references to the 2 or more bodies corporate required by section 79 to be treated as 1 person.
Subpart does not apply to certain liable persons “81 “(1) This subpart does not apply to a liable person in respect of a financial year (financial year A) if— “(a) the liable person was not trading in the financial year preceding financial year A; or the financial statements of the liable person for the fi- nancial year preceding financial year A record turnover of less than the specified turnover.
“(b) “(2) For the purpose of determining whether a person is a liable person to whom this subpart applies in respect of a financial year, the Commission may, by written notice to that person, require the person to provide to the Commission, within the time specified in the notice,— “(a) a copy of the person’s financial statements for the year preceding financial year A; and a certificate that complies with subsection (3).
“(b) “(3) A certificate complies with this subsection if— “(a) it certifies— “(i) the person’s turnover as recorded for the year pre- ceding financial year A; and 11 Part 1 cl 11 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(ii) whether the person provides a telecommunica- tions service in New Zealand by means of some component of a PTN that is operated by that per- son; and it is signed by 2 directors of the person with the author- ity of the other directors.
“(b) “82 Liable persons must produce information on turnover Not later than 60 working days before the end of each financial year (financial year A), each liable person must provide to the Commission a copy of— “(a) its financial statements for the financial year preceding financial year A; and any further information specified by the Commission for the purpose of enabling it to verify the turnover of that person for the financial year preceding financial year A.
“(b) “83 Liable persons must produce information for purposes of liability allocation determination “(1) Not later than 60 working days after the end of each financial year, each liable person must provide to the Commission— “(a) all prescribed information or, if there is no prescribed information, information specified by the Commission, for the purpose of enabling the Commission to make its determination in accordance with section 88(a); and a report that complies with subsection (2).
“(b) “(2) A report complies with this subsection if— “(a) “(b) it is prepared by a qualified auditor; and it includes a statement of the extent to which the infor- mation provided by the liable person under subsection (1)(a) is correct and complete.
“84 Commission to prepare draft liability allocation determination “(1) The Commission must— “(a) prepare a draft liability allocation determination for each financial year; and “(b) give public notice of that draft determination; and 12 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 11 “(c) include in the public notice the closing date for submis- sions, which must be not later than 20 working days after the date of giving public notice.
“(2) The Commission must make reasonable efforts to do the things referred to in subsection (1) not later than 80 working days after the end of the financial year.
“85 Matters to be included in draft liability allocation determination “(1) A draft liability allocation determination must include— “(a) “(b) the amount of each liable person’s qualified revenue; and the amount of the telecommunications development levy payable by each liable person for the financial year, calculated in accordance with the following formula: a b × c where— a b c is the amount of the liable person’s qualified rev- enue is the sum of all liable persons’ qualified revenue is the telecommunications development levy spe- cified for the relevant year in Schedule 3B; and the methodology applied by the Commission in prepar- ing the determination; and the reasons for the determination.
“(c) “(d) “(2) To avoid doubt, the Commission may determine what revenue basis to use for the purposes of subsection (1)(a) (for ex- ample, a net-revenue basis).

“86 Conferences on draft liability allocation determination The Commission may— “(a) hold conferences in relation to the draft liability alloca- tion determination; and invite to those conferences any person who has a mater- ial interest in the determination.
“(b) 13 Part 1 cl 11 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “87 Commission to prepare final liability allocation determination “(1) The Commission must— prepare a final liability allocation determination; and “(a) “(b) give public notice of that final determination; and “(c) give a copy of that final determination to all liable per- sons.
“(2) The Commission must make reasonable efforts to do the things referred to in subsection (1) not later than 20 working days after the closing date for submissions specified in accordance with section 84(1)(c).
“88 Matters to be included in final liability allocation determination A final liability allocation determination must include— “(a) the amount of each liable person’s qualified revenue; and the amount of the telecommunications development levy payable by each liable person, calculated in ac- cordance with the formula set out in section 85(1)(b); and the methodology applied by the Commission in prepar- ing the determination; and the reasons for the determination.
“(b) “(c) “(d) “89 Payment by liable persons to Crown “(1) Each liable person must pay to the Crown the amount set out in the determination in accordance with section 88(b) not later than 20 working days after the date that the determination is publicly notified.
If that amount is not paid on or before the due date,— “(a) “(2) it is recoverable in any court of competent jurisdiction as a debt due to the Crown; and the liable person must pay the Crown interest on the unpaid amount at the 90-day bank bill rate (as at 21 working days after the date on which the determination is publicly notified) plus 5% for the period from the time the amount was due until the time at which it is paid.
“(b) 14 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 11 “(3) Subsection (2) does not authorise the imposing of interest on interest.
“General matters “90 Crown use of amounts paid by liable persons “(1) The amounts paid by liable persons under section 89 may be used for the following purposes: to pay TSO charges: “(a) to pay for non-urban telecommunications infrastructure “(b) development: to pay for upgrades to the emergency service calling system: any other purpose that the Minister considers will either— “(i) “(d) “(c) “(ii) promote competition in telecommunications markets for the long-term benefit of end-users of telecommunications services within New Zealand; or facilitate the supply of certain telecommunica- tions services to groups of end-users within New Zealand to whom those telecommunications ser- vices may not otherwise be supplied on a com- mercial basis or at a price that is considered by the Minister to be affordable to those groups of end-users.
“(2) To avoid doubt, except as provided in section 94J, nothing in this section requires the Crown— “(a) to use any amount paid by liable persons under section 89 within any particular time; or to refund any amount or part of an amount to a liable person if the Crown uses it for a purpose other than a purpose referred to in subsection (1).
“(b) “91 Commission must notify final liability allocation determination before notifying TSO cost calculation determination “(1) The Commission may determine the priority between the prep- aration of a liability allocation determination and the prepar- 15 Part 1 cl 11 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill ation of a TSO cost calculation determination and, accord- ingly, may comply with sections 84 to 88 and sections 94D to 94I in the sequence, as between those 2 sets of sections, as it thinks fit.
“(2) However, the Commission must publicly notify a final liability allocation determination for each financial year in accordance with section 87(1)(b) before it publicly notifies any final TSO cost calculation determination for that financial year in accord- ance with section 94H(1)(b).
“Subpart 2A—TSO charges payable by Crown “Assessment of compliance “92 Assessment of compliance with TSO instrument Not later than 60 working days after the end of each financial year, the Commission must— “(a) assess a TSO provider’s compliance with its TSO in- strument during that financial year in accordance with any process set out in the TSO instrument; and “(b) notify the TSO provider and the Minister, in writing, of any non-compliance by the TSO provider with the TSO instrument.
“TSO provider may request TSO cost calculation determination “93 TSO provider under TSO instrument without specified “(1) amount may request TSO cost calculation determination If a TSO provider under a TSO instrument that does not con- tain a specified amount wishes to have the TSO charges for the instrument determined in respect of a financial year, the TSO provider must notify the Commission that it wishes to invoke the procedure in sections 94B to 94I for the preparation of a TSO cost calculation determination for that financial year.
“(2) The notification must be— in writing; and “(a) “(b) given not later than 30 working days after the end of the relevant financial year.
16 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 11 “94 TSO provider who requests TSO cost calculation determination liable for costs in certain circumstances “(1) A TSO provider who gives notice under section 93 must, if the Commission determines the TSO charges for the instru- ment to be zero, pay the costs of the Commission relating to the procedure in sections 94D to 94I for the preparation of the TSO cost calculation determination (including the costs of any expert advice) as directed by the Commission in writing.
“(2) The Commission may enforce a direction given under sub- section (1) by filing it in the prescribed form in the Welling- ton Registry of the High Court.

“(3) A direction that is filed in the Registry of the High Court under this section is enforceable as a judgment of the High Court in its civil jurisdiction.
“94A TSO charges deemed to be zero if TSO provider does not request TSO cost calculation determination If a TSO provider under a TSO instrument that does not con- tain a specified amount does not notify the Commission in ac- cordance with section 93,— “(a) sections 91 and 94B to 94J do not apply in respect of the TSO provider or TSO instrument; and the TSO charges for the instrument are deemed to be zero.
“(b) “Annual procedure for determining TSO charges payable by Crown “94B Calculations of net cost and auditor’s report must be given to Commission “(1) Not later than 60 working days after the end of each financial year, a TSO provider under a TSO instrument that does not contain a specified amount must provide to the Commission— calculations of the net cost to the TSO provider of com- “(a) plying with the TSO instrument during the financial year; and a report prepared by a qualified auditor that includes a statement of whether or not the calculations comply with— “(b) 17 Part 1 cl 11 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(i) “(ii) any prescribed requirements relating to those cal- culations; and any requirements of the Commission.
“(2) This section is subject to section 94A.
“94C Considerations for determining net cost “(1) In calculating the net cost under section 94B and calculating the net cost for the purposes of a draft TSO cost calculation determination under section 94D and a final TSO cost calcu- lation determination under section 94H, the following must be taken into account: “(a) in the case of an instrument that is declared to be a TSO instrument under section 70, the range of direct and indirect revenues and associated benefits derived from providing telecommunications services to com- mercially non-viable end-users, less the costs of pro- viding those services to those end-users: in the case of a deemed TSO instrument, the range of direct and indirect revenues and associated benefits de- rived from providing telecommunications services to all end-users connected to existing residential lines, less the costs of providing those services to those end-users: the provision of a reasonable return on the incremental capital employed in providing those services to end- users.
“(b) “(c) “(2) Subsection (1) is subject to subsections (3) and (4).
“(3) In calculating the net cost for the purposes of a draft TSO cost calculation determination under section 94D and a final TSO cost calculation determination under section 94H, the Com- mission— “(a) may choose not to include profits from any new telecommunications services that involve significant capital investment and that offer capabilities not avail- able from established telecommunications services; and “(b) must not include any losses from telecommunications services other than services that the TSO instrument re- quires the TSO provider to provide; and “(c) must consider the purpose set out in section 18.
18 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 11 “(4) “(5) In calculating the net cost under section 94B, the TSO provider must comply with any requirements of the Commis- sion relating to the application of subsection (3)(a) to (c).
In this section,— “established telecommunications services means telecom- munications services that are not new telecommunications ser- vices “new telecommunications services means telecommunica- tions services that were first provided in New Zealand within 5 years before the start of the financial year to which the cal- culation of the net cost relates.
“94D Commission to prepare draft TSO cost calculation determination “(1) The Commission must— “(a) prepare a draft TSO cost calculation determination in respect of each TSO instrument for each financial year; and “(b) give public notice of that draft determination; and “(c) include in the public notice the closing date for submis- sions, which must be not later than 20 working days after the date of giving public notice.
“(2) The Commission must make reasonable efforts to do the things referred to in subsection (1) not later than 120 working days after the end of the financial year.

“(3) This section is subject to sections 93 and 94A.
“94E Matters to be included in draft TSO cost calculation determination A draft TSO cost calculation determination must include,— “(a) if the TSO instrument does not contain a specified amount, the net cost to the TSO provider of complying with the TSO instrument during the financial year and all material information that— “(i) relates to the calculation of the net cost; and “(ii) would not, in the opinion of the Commission, be likely to unreasonably prejudice the commercial position of the TSO provider; and 19 Part 1 cl 11 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(b) “(c) “(d) “(e) if the TSO instrument contains a specified amount, the dollar amount of the specified amount and all material information that— “(i) “(ii) would not, in the opinion of the Commission, be likely to unreasonably prejudice the commercial position of the TSO provider; and relates to the calculation of that amount; and the amount (if any) by which the total amount that the TSO provider would receive from the Crown in rela- tion to the TSO instrument must be reduced because the TSO provider has not complied with the TSO in- strument; and the methodology applied by the Commission in prepar- ing the determination; and the reasons for the determination.
“94F Requirements for draft TSO cost calculation determination In preparing a draft TSO cost calculation determination of the matters referred to in section 94E(c), the Commission must consider the steps taken (if any) by the TSO provider to rem- edy any non-compliance by the TSO provider with the TSO instrument between the date the TSO provider was notified of the non-compliance under section 92(b) and the date that is 15 working days before public notice is given under section 94D(1)(b).
“94G Conferences on draft TSO cost calculation determination The Commission may— “(a) hold conferences in relation to a draft TSO cost calcu- lation determination; and invite to those conferences any person who has a mater- ial interest in the determination.
“(b) “94H Commission to prepare final TSO cost calculation determination “(1) The Commission must— prepare a final TSO cost calculation determination; and “(a) “(b) give public notice of that final determination; and 20 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 11 “(c) give a copy of that final determination to the Minister, all liable persons, and the TSO providers in relation to the TSO instrument.
“(2) The Commission must make reasonable efforts to do the things referred to in subsection (1) not later than 40 working days after the closing date for submissions specified in accordance with section 94D(1)(c).

“(3) This section is subject to sections 93 and 94A.
“94I Matters to be included in final TSO cost calculation determination “(1) A final TSO cost calculation determination must include,— “(a) “(b) “(c) “(d) if the TSO instrument does not contain a specified amount, the net cost to the TSO provider of complying with the TSO instrument during the financial year and all material information that— “(i) relates to the calculation of the net cost; and “(ii) would not, in the opinion of the Commission, be likely to unreasonably prejudice the commercial position of the TSO provider; and if the TSO instrument contains a specified amount, the dollar amount of the specified amount and all material information that— “(i) “(ii) would not, in the opinion of the Commission, be likely to unreasonably prejudice the commercial position of the TSO provider; and relates to the calculation of that amount; and the amount (if any) by which the total amount that the TSO provider would receive from the Crown in rela- tion to the TSO instrument must be reduced because the TSO provider has not complied with the TSO in- strument; and the amount payable by the Crown to the TSO provider in relation to the TSO instrument in respect of the finan- cial year calculated,— “(i) in the case of a TSO instrument that does not contain a specified amount, by subtracting the amount of the reduction (if any) referred to in 21 Part 1 cl 11 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(ii) paragraph (c) from the net cost referred to in paragraph (a); and in the case of a TSO instrument that contains a specified amount, by subtracting the amount of the reduction (if any) referred to in paragraph (c) from the specified amount referred to in para- graph (b); and “(e) “(f) “(g) the amount payable by the Crown to the TSO provider in relation to the TSO instrument for the loss of use of the amount referred to in paragraph (d), calculated at the 90-day bank bill rate (as at the date of the final determination) for the period commencing from the end of the financial year and ending with the
 date of the final TSO cost calculation determination; and the methodology used by the Commission in preparing the determination; and the reasons for the determination.
“(2) To avoid doubt, if the calculation under subsection (1)(a) or (b) results in a figure that is zero or less, the amount for the purposes of subsection (1)(d) and (e), and that must be included in the determination, is zero.
“94J Payment by Crown to TSO provider “(1) The Crown must pay to the TSO provider, not later than 30 working days after the date that the final TSO cost calculation determination is publicly notified,— “(a) “(b) the amount set out in the final TSO cost calculation de- termination in accordance with section 94I(1)(d); and the amount set out in the final TSO cost calculation de- termination in accordance with section 94I(1)(e).
If the Crown does not pay the total of the amounts referred to in subsection (1) on or before the due date, the Crown must pay the TSO provider interest on the unpaid amount at the 90-day bank bill rate (as at 31 working days after the date on which the final cost calculation determination is publicly notified) for the period from the time the amount was due until the time at which it is paid.” “(2) 22 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 14 12 13 Section 99 repealed Section 99 is repealed.
New section 100 substituted Section 100 is repealed and the following section substituted: “100 Right of appeal to High Court “(1) The following persons and (as applicable) the Crown may ap- peal to the High Court against the following matters: “(a) a liable person, against a determination of the Commis- sion, in relation to that person, of the matter referred to in section 88(a): a TSO provider, against a direction of the Commission under section 94(1): a TSO provider or the Crown, against a determination of the Commission in respect of a matter referred to in section 94I(1)(a) to (g).
“(b) “(c) “(2) An appeal under subsection (1) may be on a question of law “(3) only.

If an appeal or judicial review proceedings are commenced about a liability allocation determination, TSO cost calculation determination, or direction under section 94(1), the deter- mination or direction continues to have effect and is enforce- able as if the proceedings had not been commenced until the proceedings are finally disposed of.
“(4) To avoid doubt, the obligations to pay money imposed by sec- tions 89 and 94J continue to have effect and are enforceable despite any appeal or judicial review proceedings about a de- termination that relates to those payments, until the proceed- ings are finally disposed of.
“(5) TSO provider, in subsection (1), means the TSO provider under the TSO instrument to which the direction or determin- ation relates.” 14 (1) Commission must include information about deemed TSO instrument in TSO cost calculation determinations Section 100B(1)(a) is amended by omitting “section 92” and substituting “section 94D”.
23 Part 1 cl 15 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill (2) (3) Section 100B(1)(b) is amended by omitting “section 93C” and substituting “section 94H”.

Section 100B(3) is amended by omitting “customers” and sub- stituting “end-users”.
15 New section 100BA inserted The following section is inserted after section 100B: “100BA Commission must include information about spending of TSO charges paid in relation to deemed TSO instrument “(1) The Commission must include the information specified in subsection (2) in— “(a) a draft TSO cost calculation determination under sec- tion 94D, in relation to a deemed TSO instrument; and a final TSO cost calculation determination under sec- tion 94H, in relation to a deemed TSO instrument.
“(b) “(2) The information referred to in subsection (1) is the amount of the total TSO charges most recently received by the TSO provider (if any), that the TSO provider has spent on each of the following, and details of that expenditure: “(a) TSO-related infrastructure: “(b) TSO-related operational costs: “(c) any other items.
“(3) For the purpose of enabling the Commission to comply with subsection (1), the Commission may require the TSO provider to prepare and provide information about the spend- ing of the TSO charges most recently received by the TSO provider.
“(4) The TSO provider must prepare and provide any information required under subsection (3) in accordance with the Com- mission’s requirements.” Duties of Commission in complying with section 100B The heading to section 100C is amended by omitting “section 100B” and substituting “sections 100B and 100BA”.
Section 100C is amended by adding the following subsection: In complying with section 100BA, the Commission must en- sure that satisfactory provision exists to protect the confiden- 16 (1) (2) “(3) 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 17 tiality of any information that may reasonably be regarded as confidential or commercially sensitive.” 17 New section 101 substituted Section 101 is repealed and the following section substituted: “101 Regulations “(1) The Governor-General may, by Order in Council made on the recommendation of the Minister, make regulations that— “(a) determine the amount of the specified turnover for the purposes of section 80: “(b) prescribe the information that must be provided to the “(c) Commission under section 83(1)(a): provide for the appointment of auditors who may make an auditor’s report under sections 83(1)(b) or 94B(b): “(d) prescribe requirements to which section 94B(b)(i) ap- “(e) plies: provide for any methods for all or any of the following: preparing a draft determination of the amount “(i) of qualified revenue referred to in section 85(1)(a): “(ii) determining the amount of qualified revenue re- ferred to in section 88(a): “(iii) calculating the net cost under section 94B: “(iv) preparing a draft determination of the net cost referred to in section 94E(a): “(v) determining the net cost referred to in section 94I(1)(a).
“(2) The Minister must not make a recommendation under sub- section (1)(b) to (e) unless— “(a) “(b) the Commission has consulted every liable person; and the Commission has recommended that the regulations be made.

“(3) The Minister must not recommend the making of regulations under subsection (1)(a) unless the Minister is satisfied that, if the regulations were made, the specified turnover under those regulations would not exceed the maximum specified turnover.
In this section, maximum specified turnover means the amount calculated in accordance with the following formula: “(4) 25 Part 1 cl 18 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill a b × c where— a is the CPI index number for the last quarter before the Minister’s recommendation would be made is the CPI index number for the last quarter before the date of commencement of the Telecommunications (TSO, Broadband, and Other Matters) Amendment Act 2010 is $10 million.
b c Application of section 156B Section 156A is amended by repealing paragraphs (i) and (j) and substituting the following paragraphs: “(i) fails, without reasonable excuse, to provide to the Com- mission not later than the time specified by it— “(a) “(b) the information referred to in section 81(2)(a): the certificate referred to in section 81(2)(b): “(ia) knowingly provides or signs a false or misleading cer- tificate under section 81: “(ib) knowingly provides false or misleading information or “(j) documents under section 81: fails, without reasonable excuse, to comply with sec- tion 82: “(ja) knowingly provides false or misleading information or documents under section 82:”.
Section 156A is amended by inserting the following para- graphs after paragraph (l): “(la) fails, without reasonable excuse, to comply with sec- tion 94B: “(lb) knowingly provides false or misleading information or “(lc) documents under section 94B: fails, without reasonable excuse, to comply with a requirement of the Commission under section 100BA(3): “(ld) knowingly provides false or misleading information or documents under section 100BA:”.
18 (1) (2) 26 19 20 21 22 (1) (2) Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 1 cl 22 Further amendments to principal Act The principal Act is amended in the manner set out in Sched- ule 1.

New Schedule 3B inserted The Schedule 3B set out in Schedule 2 of this Act is inserted after Schedule 3A.
Subpart 2—Savings and transitional issues Savings provision for financial years up to and including 2009/2010 financial year The principal Act continues to apply, as if this Act had not been passed, to— (a) all TSO instruments, deemed TSO instruments, TSO providers, and liable persons for the financial year ended 30 June 2010 and all prior financial years; and every decision or determination relating to a TSO in- strument or deemed TSO instrument made, or required to be made, by the Commission in respect of the fi- nancial year ended 30 June 2010 and all prior financial years.
(b) Transitional provision concerning liability allocation determination for 2010/11 financial year This section applies in respect of the financial year ended 30 June 2011.
For the purposes of subpart 2 of Part 3 of the principal Act,— (a) the definition of liable person (as substituted by this Act) does not apply; and liable person means— a person— (i) (A) who is identified by the Commission as a liable person in its final cost allocation determination, for the financial year ended 30 June 2010, in relation to the deemed TSO instrument known as the Telecom- munications Service Obligations (TSO) (b) 27 Part 1 cl 23 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Deed for Local Residential Telephone Service; and (B) whose turnover for the financial year ended 30 June 2010 is equal to or greater than the specified turnover; and (c) (d) Telecom; and (ii) the definition of qualified revenue (as substituted by this Act) does not apply; and qualified revenue means the amount of revenue that, during the financial year, each liable person received from supplying all or any of the following: (i) telecommunications services by means of its PSTN: telecommunications services by means that rely primarily on the existence of its PSTN or any other PSTN: directory services in respect of PSTN numbers; and (ii) (iii) sections 81(1) and 82 do not apply.
(e) For the avoidance of doubt,— (a) section 81(2) and (3) apply for the purpose of de- termining whether a person is a liable person, within the meaning of subsection (2)(b)(i) of this section, to whom subpart 2 of Part 3 applies in respect of the fi- nancial year ended 30 June 2011; and except as provided in subsections (1) and (2) of this section, subpart 2 of Part 3 of the principal Act (as substituted by this Act) otherwise applies in respect of the financial year ended 30 June 2011.
(b) Transitional provision concerning information about deemed TSO instruments to be included in TSO cost calculation determinations Section 100BA of the principal Act (as inserted by this Act) does not apply in respect of any TSO charge received by a TSO provider before the 2010/2011 financial year.
(3) 23 28 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 Part 2 Telecommunications networks involving Crown funding 24 New Part 4AA inserted The following Part is inserted after Part 4: “Part 4AA “Undertakings regime for services provided using networks developed with Crown funding “Subpart 1—Preliminary provisions “156AA Overview “(1) This Part— “(a) enables providers of wholesale telecommunications ser- vices that are provided using a specified network, or that provide access to unbundled elements of such a net- work, to give enforceable undertakings providing for non-discrimination, equivalence, and other matters in relation to the supply of those services; and “(b) precludes the Commission from recommending, in a final report delivered to the Minister before the close of 31 December 2019, that particular services provided by a service provider who has given an undertaking be added to Part 2 or 3 of Schedule 1 as a designated ser- vice or a specified service; and requires service providers who have given undertakings in relation to those particular services to disclose infor- mation concerning costs and other matters relating to provision of those services in accordance with require- ments of the Commission.
“(c) “(2) Accordingly,— “(a) subpart 2— “(i) specifies requirements for undertakings and mat- ters that may be included in undertakings (sec- tions 156AD and 156AE); and “(ii) provides for the Minister to determine further requirements with which an undertaking must comply (sections 156AF to 156AI); and 29 Part 2 cl 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(iii) provides a process for the approval of under- takings by the Minister (sections 156AJ and 156AK); and “(iv) provides for the variation and termination of undertakings (sections 156AN to 156AQ); and “(v) precludes the Commission from recommending, in a final report delivered to the Minister before the close of 31 December 2019, that particular services provided by a service provider who has given an undertaking be added to Part 2 or 3 of Schedule 1 (section 156AR); and “(vi) provides for the enforcement of undertakings (sections 156AS to 156AU); and “(b) subpart 3 provides for the Commission to require dis- closure of information by service providers who have in force undertakings in relation to the services specified in section 156AR.
“(3) This section is intended only as a guide to the general scheme and effect of this Part.
“156AB Interpretation In this Part, unless the context otherwise requires,— “access seeker— “(a) means a person who seeks access to a relevant service; “(b) and includes, where the service provider supplies a relevant service to itself, the service provider itself “disclose means to supply to the Commission “equivalence, in relation to the supply of a relevant service, means equivalence of supply of the service and access to the service provider’s network so that third-party access seekers are treated in the same, or an equivalent way, to the service provider’s own business operations, including in relation to pricing, procedures, operational support, supply of informa- tion, and other relevant matters 30 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 “(c) “(b) “FTTP access network or fibre-to-the-premises access net- work— “(a) means a network structure used to deliver telecommuni- cations services over fibre media that connects a pow- ered node in a central office location (an exchange or equivalent powered facility) to an end-user’s premises or building, or the optical distribution facility of an end-user’s premises or building; and includes the powered node in the central office location; and includes that part of the overall telecommunications link that connects to the end-user’s equipment “FTTP service provider or fibre-to-the-premises service provider means a service provider who— “(a) owns or operates an FTTP access network; and “(b) has given an undertaking that is in force in relation to a relevant service specified in section 156AR(3) “information includes any statement, certificate, or other in- formation required to be disclosed under this Part “non-discrimination, in relation to the supply of a relevant service, means that the service provider must not treat access seekers differently, except to the extent that a particular differ- ence in treatment is objectively justifiable and does not harm competition in any telecommunications market “prescribed means
 prescribed by the Commission “relevant service means a wholesale telecommunications ser- vice that is provided using, or that provides access to unbun- dled elements of, a specified network “service provider means a provider of a relevant service “specified entity means an entity named in Schedule 3C “specified network means a network that is declared to be a specified network under section 156AY “undertaking means an undertaking under this Part.
31 Part 2 cl 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “Subpart 2—Undertakings “156AC Purpose The purpose of this subpart is to promote competition in telecommunications markets for the long-term benefit of end-users of telecommunications services in New Zealand, by providing for non-discrimination and equivalence principles and rules to apply to certain telecommunications services.
“Requirements for undertakings “156AD Main requirements for undertakings “(1) A service provider may enter into an undertaking.
“(2) The undertaking must— be executed by the service provider; and “(a) “(b) provide for the service provider to achieve non-discrim- ination in relation to the supply of relevant services; and set out the rules and principles that the service provider will apply to ensure that non-discrimination is achieved in relation to the supply of the relevant services; and “(c) “(d) provide for disclosure of relevant information to the Commission, to support the Commission’s assessment of compliance with the undertaking; and provide for any other matters required by a determin- ation of the Minister under section 156AF.
“(e) “(3) An undertaking must not— “(a) “(b) provide for rules or obligations in respect of services that are not relevant services; or specify the price or non-price terms of supply for any telecommunications service.
“156AE Further matters that may be included in undertakings In addition to the requirements in section 156AD, and without limiting the further matters that (subject to section 156AD(3)) may be included in an undertaking, an undertaking may— “(a) provide for the service provider to achieve equivalence in relation to the supply of a particular relevant service; and 32 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 “(b) “(c) “(d) “(e) set out the rules and obligations relating to the design, construction, and operation of telecommunications in- frastructure, facilities, and supporting systems to be ap- plied for the purpose of ensuring that equivalence is achieved in relation to the supply of the relevant ser- vice; and specify a mechanism for resolution, by a suitably qual- ified and experienced independent person, of any dis- putes that arise after the undertaking is approved; and specify rules for the treatment of confidential informa- tion relating to access seekers; and provide that the directors of the service provider must certify that the service provider has complied with the undertaking.
“156AF Minister may determine further requirements for undertakings “(1) The Minister may determine further requirements with which an undertaking must comply.

“(2) The further requirements may— “(a) “(b) specify the relevant services, or types of relevant ser- vices, to which the requirements in section 156AD and the further matters in 156AE apply, and how they are to apply; and include further matters that must be addressed in the undertaking, and minimum requirements for the under- taking.
“156AG Minister may issue and consult on draft determination Before making a determination under section 156AF, the Minister may prepare a draft determination and consult on that draft with those persons that the Minister considers have a ma- terial interest in the determination.

“156AH Procedural requirements for determination “(1) The Minister must notify a determination made under section 156AF in the Gazette as soon as practicable after it is made.
“(2) The notice in the Gazette— “(a) need not contain the determination: 33 Part 2 cl 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(b) must give a brief description of the nature of the deter- mination: “(c) must state where copies of the determination are avail- able for inspection and purchase.
“(3) The Minister must make the determination available to the public by making copies of it available— “(a) for inspection, free of charge,— “(i) at the head office of the Ministry (during office hours); and “(ii) on the Internet in an electronic form that is pub- licly accessible (at all reasonable times); and “(b) for purchase at a reasonable price.
“(4) A determination is deemed to be a regulation for the purposes of the Regulations (Disallowance) Act 1989 but not for the purpose of the Acts and Regulations Publication Act 1989.

“(5) The Minister must present a copy of the determination to the House of Representatives in accordance with section 4 of the Regulations (Disallowance) Act 1989.

“156AI Variation of determination “(1) The Minister may vary a determination made under section “(2) 156AF.
If the Commission considers that a variation of a determin- ation made under section 156AF is required in order to best promote the purposes of this subpart, it may recommend that variation to the Minister.

“(3) Sections 156AG and 156AH apply, with all necessary modi- fications, to a draft variation or variation of a determination as if the draft variation or variation were a draft determination or a determination.
“Process for submission and consideration of undertakings “156AJ Service provider must submit undertakings for approval by Minister A service provider must submit an undertaking for approval by the Minister by sending the undertaking in writing to the Minister.
34 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 “156AK Minister may approve or decline undertakings “(1) The Minister may, by notice in writing to the service provider who submitted the undertaking,— “(a) approve the undertaking; or “(b) decline to approve the undertaking.
If the Minister declines to approve the undertaking, the Min- ister— “(a) must give reasons for not approving the undertaking; “(2) and “(b) may invite the service provider to submit an amended undertaking for approval by the Minister.

“(3) Subsections (1) and (2) and section 156AJ apply to an amended undertaking.

“(4) The Minister must notify his or her approval of an undertaking by notice in the Gazette.
“Implementation of undertakings “156AL Implementation of undertaking On and from the date that the Minister’s approval of an under- taking is notified in accordance with section 156AK(4), the undertaking takes effect as if it were a deed that is— properly executed by, and binding on, “(a) provider; and the service “(b) given in favour of the Crown.
“156AM Service provider must publish undertaking “(1) As soon as practicable after the Minister’s approval of an undertaking is notified, the service provider must publish the undertaking on an Internet site maintained by or on behalf of the service provider so that it is publicly accessible at all reasonable times.

“(2) The service provider must make a copy of the undertaking available for inspection free of charge at its registered office.
35 Part 2 cl 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “Variation and termination of undertakings “156AN Variation of undertaking “(1) The Minister may, on the recommendation of the Commission, approve a variation of an undertaking.
“(2) The Commission must not make a recommendation under subsection (1) unless— “(a) the service provider who gave the undertaking has sub- mitted a request for the variation to the Commission; and the Commission is satisfied that the variation would best promote the purposes of this subpart.

“(b) “156AO Procedure for variation of undertaking “(1) A service provider may submit a request for a variation of an undertaking under section 156AN by sending the proposed variation in writing to the Commission.
“(2) The Commission must notify the service provider in writing of whether it proposes to recommend that the Minister approve the variation.

If the Commission does not propose to recommend that the Minister approve the variation, the notice under subsection (2)— “(a) must set out the reasons why the Commission does not “(3) propose to make the recommendation; and “(b) may invite the service provider to submit an amended variation for consideration.
“(4) The Commission must make reasonable efforts to give the no- tice not later than 30 days after the Commission receives the request for the variation from the service provider.

“(5) Sections 156AK to 156AM apply, with all necessary modi- fications, to a variation of an undertaking as if the variation were an undertaking.
“156AP Undertaking that no longer meets requirements of determination ceases to have effect if not varied “(1) This section applies if— “(a) the Minister varies a determination under section 156AI; and 36 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 “(b) “(c) after the variation, an undertaking approved under sec- tion 156AK no longer meets the requirements of the determination; and the Minister has not, before the end of the 6-month period referred to in subsection (2),— “(i) approved a variation of the undertaking under section 156AN; and confirmed to the service provider in writing that the undertaking, as varied, complies with the re- quirements of the determination.
“(ii) “(2) If this section applies, the undertaking ceases to have effect from the date that is 6 months after the date on which the vari- ation of the determination was notified in the Gazette in ac- cordance with section 156AH.

“156AQ Termination of undertaking “(1) An undertaking may be terminated by mutual agreement be- “(2) tween the service provider and the Minister.
If the Commission considers that the termination of an under- taking would best promote the purposes of this subpart, it may recommend to the Minister that the undertaking be terminated in accordance with subsection (1).
“Effect of undertakings in relation to certain relevant services “156AR Commission may not recommend certain services be designated services or specified services if undertaking applies “(1) This section applies to a final report delivered to the Minister under clause 4 of Schedule 3 before the close of 31 December 2019.
“(2) A final report must not recommend a proposed alteration to Part 2 or 3 of Schedule 1 by adding a service specified in sub- section (3) if— “(a) the access provider described in relation to the service is a service provider who has given an undertaking in relation to the service; and that undertaking is in force.
“(b) 37 Part 2 cl 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “(3) The services referred to in subsection (2) are— “(a) “(b) access to the unbundled elements of a fibre-to-the- premises access network: access to a packet-based bitstream service that enables access to a fibre-to-the-premises access network.
“(4) To avoid doubt, subsection (2) does not prevent the Com- mission from— “(a) commencing an investigation under clause 1 of Sched- ule 3 into whether a service specified in subsection (3) should be added to Schedule 1 under section 66(a); or “(b) delivering a final report to the Minister before the close of 31 December 2019 that recommends a proposed al- teration to Part 2 or 3 of Schedule 1 by adding a ser- vice specified in subsection (3), if the report names as the access provider or access providers in relation to the service only persons who are not parties to undertakings that are in force in relation to the service.
“Enforcement of undertakings “156AS Enforcement and remedies under Part 4A Sections 156L, 156M, and 156O to 156R apply to an under- taking under this Part as provided in Part 4A.
“156AT Power of court to grant relief in respect of undertakings If, on the application of the Commission, it appears to the High “(1) Court that a service provider intends to engage, or is engaging, or has engaged, in conduct that constitutes, or would consti- tute, a breach of the terms of an undertaking, the court may make any orders on any terms and conditions that it thinks ap- propriate, including, without limitation,— “(a) an order to— “(i) restrain the service provider from engaging in conduct that constitutes, or would constitute, the breach: require the service provider to do a particular act or thing: “(ii) “(iii) require the service provider to comply with the terms of the undertaking.
38 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 “(2) In any proceeding under this section, the Commission, on the order of the court, may obtain discovery and administer inter- rogatories.

“(3) The court may at any time rescind or vary an order made under this section.
“156AU Interrelationship of remedies “(1) Nothing in this Part or Part 4A limits or affects any right, duty, liability, or remedy in respect of an undertaking that exists or is available apart from this Part or Part 4A.

“(2) Any right of action or other remedy available under this Part or Part 4A in respect of an undertaking may be taken, proceeded with, or heard in conjunction with any other action or remedy available under this Act or otherwise.
“(3) However, in determining whether to order a person to pay a penalty, compensation, or damages in respect of an undertak- ing, the court must have regard to— “(a) whether that person has already been ordered to pay a penalty, compensation, or damages for the same matter; and if so, the amount and effect of that first order.
“(b) “Subpart 3—Information disclosure by FTTP service providers with undertakings “156AV Purpose The purpose of this subpart is to promote competition in telecommunications markets for the long-term benefit of end-users of telecommunications services in New Zealand by requiring FTTP service providers to provide reliable and timely information to the Commission to enable it to record over time the operational and capital costs associated with the construction, use, and maintenance of FTTP networks to inform the Commission’s statutory processes and determin- ations.
39 Part 2 cl 24 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “156AW Commission must require disclosure by FTTP service providers “(1) The Commission must require FTTP service providers to pre- pare and disclose information about the costs and characteris- tics of relevant services and the FTTP access networks used to provide, or comprised of, relevant services.
“(2) The Commission may require FTTP service providers to pre- pare and disclose information consisting of, or about, the fol- lowing things, as part of the information required under this section: “(a) financial statements: “(b) “(c) “(d) “(e) “(f) asset valuations and valuation reports: prices, terms, and conditions: costs and cost allocation methodologies: contracts: transactions with related parties (as if the test for related parties were the same as the test in section 79), includ- ing prices and methodologies in relation to such trans- actions: “(g) financial and non-financial performance measures: “(h) plans and forecasts: “(i) transfer payments (whether actual or notional) amongst prescribed business activities: network capacity information: characteristics of relevant services: policies and methodologies in the areas referred to in paragraphs (a) to (k) or other areas.
“(j) “(k) “(l) “(3) The Commission may, as part of the information required under this section,— “(a) define the prescribed business activities and prescribed services in respect of which the FTTP service provider must prepare and disclose information: require the FTTP service provider to adopt, in the prep- aration or compilation of that information, any method- ology that is required by the Commission (including the allocation methodology that must be used for preparing the financial statements and allocating the costs): require the FTTP service provider to disclose the man- ner in which methodologies have been applied: “(b) “(c) 40 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 24 “(d) prescribe the information that must be included in the financial statements to be prepared and disclosed.
“(4) FTTP service providers must prepare and disclose the infor- mation required under this section in accordance with the Commission’s requirements.
“156AX Further powers of Commission relating to information disclosure The Commission may, in making requirements under section 156AW,— “(a) “(b) “(c) “(d) “(e) “(f) “(g) “(h) prescribe the form and manner in which information must be disclosed: specify a time or date, or times or dates, as at which information must be disclosed: require the disclosure of assumptions made in the prep- aration of the information: require the audit of disclosed information: require disclosed information, or information from which disclosed information is derived (in whole or in part), to be certified, in a prescribed form and manner, by persons belonging to any specified class of persons: set rules about when and for how long information must be disclosed: require the retention of data on which disclosed infor- mation is based and associated documentation: exempt or provide for exemptions (including provide for the revocation of exemptions), on any terms and conditions, of any person or class of persons from all or any of the requirements: provide for transitional provisions: “(i) “(j) make requirements from time to time (for example, more than once a year): “(k) make requirements in respect of all or part of the rele- vant business.
41 Part 2 cl 25 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill “Subpart 4—Miscellaneous “156AY Governor-General may declare specified networks “(1) The Governor-General may, by Order in Council made on the recommendation of the Minister, declare that a network de- scribed in the order is a specified network for the purposes of this Part.
“(2) The Minister must not make a recommendation under sub- section (1) unless the network proposed to be described as a specified network— “(a) was constructed with funding provided, in whole or in “(b) part, by the Crown or a specified entity; and is the subject of a contract entered into between the Crown and a third party, or a specified entity and a third party, that sets out either or both of the following: “(i) the terms of funding by the Crown or a speci- fied entity to contribute to the construction of an FTTP network: the terms of funding by the Crown or a specified entity to contribute to the construction of broad- band infrastructure in non-urban areas.
“(ii) “156AZ Power to amend Schedule 3C “(1) The Governor-General may, by Order in Council, made on the recommendation of the Minister, amend Schedule 3C to add, omit, or amend the name of an entity.

“(2) An Order in Council made under this section is a regulation for the purposes of the Regulations (Disallowance) Act 1989 and the Acts and Regulations Publication Act 1989.” Application of section 156B Section 156A(g) is amended by omitting “or 69ZF(2):” and substituting “69ZF(2), or 156AW:”.
Section 156A is amended by inserting the following paragraph after paragraph (m): “(ma) fails, without reasonable excuse, to comply with sec- tion 156AM:”.

25 (1) (2) 42 26 27 28 (1) (2) Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Part 2 cl 29 Pecuniary penalty Section 156L(1) is amended by inserting the following para- graph after paragraph (a): “(ab) the person has failed, without reasonable excuse, to comply with an undertaking under Part 4AA; or”.
Heading to subpart 2 of Part 4A amended The heading to subpart 2 of Part 4A is amended by omitting “registered”.

Interpretation The definition of enforceable matter in section 156N is amended by inserting the following paragraph after paragraph (e): “(ea) an undertaking under Part 4AA:”.
The definition of party in section 156N is repealed and the following definition substituted: “party— “(a) means a party to an enforceable matter; and “(b) includes,— “(i) in the case of a separation undertaking under Part 2A, any provider of a telecommunications ser- vice that is affected by a breach of the separation undertaking; and in the case of an undertaking under Part 4AA, any telecommunications service provider who is affected by a breach of the undertaking.” “(ii) 29 (1) Complaints of breach of enforceable matter Section 156O(1) is repealed and the following subsection sub- stituted: “(1) The following persons may make a written complaint to the Commission alleging a breach of an enforceable matter: “(a) an access seeker or an access provider of a designated service or a specified service: in the case of a separation undertaking under Part 2A or an undertaking under Part 4AA, a party.” “(b) 43 Part 2 cl 30 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill (2) “(4) Section 156O(4) is repealed and the following subsection sub- stituted: In deciding whether to take the action referred to in subsection (2)(b)(ii), the Commission— “(a) must consider,— “(i) “(ii) in the case of a complaint by a person referred to in subsection (1)(a), the purpose set out in section 18; and in the case of a complaint by a party relating to a separation undertaking under Part 2A, the purposes set out in section 69A; and “(iii) in the case of a complaint by a party relating to an undertaking under Part 4AA, the purpose set out in section 156AC; and (3) “(b) may consider the financial means of the complainant.” Section 156O is amended by repealing subsection (5) and sub- stituting the following subsection: “(5) Subsection (2)(b)(i) does not apply in the case of a separ- ation undertaking under Part 2A or an undertaking under Part 4AA.” Enforcement by High Court Section 156P(2)(b) is amended by omitting “or a separation undertaking under Part 2A,” and substituting “a separation undertaking under Part 2A, or an
 undertaking under Part 4AA,”.
Further amendments to principal Act The principal Act is amended in the manner set out in Sched- ule 3.

New Schedule 3C inserted The Schedule 3C set out in Schedule 4 of this Act is inserted after Schedule 3B.

30 31 32 44 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Schedule 1 Schedule 1 Further amendments to principal Act relating to telecommunications service obligations s 19 Section 69C Definition of Ministry: repeal.
Section 106 Subsection (4)(b): omit “PSTN or PDN” and substitute “PTN”.

Section 111A Subsection (1)(a): omit “PSTN or PDN” and substitute “PTN”.

Subsection (1)(b): omit “PSTN or PDN” and substitute “PTN”.

Schedule 2: Part 1 Clause 4(4)(a): omit “PSTN or PDN” and substitute “PTN”.
Schedule 3: Part 1 Clause 4(3)(d): repeal and substitute: “(d) the majority view and any dissenting views of the mem- bers of the Commission regarding the recommenda- tion.” 45 Schedule 2 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Schedule 2 New Schedule 3B inserted Schedule 3B Annual telecommunications development levy s 20 s 85 Financial year 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 and each subsequent finan- cial year develop- Telecommunications ment levy ($) 50 million 50 million 50 million 50 million 50 million 50 million 10 million the inflation-adjusted specified telecommunications development levy The inflation-adjusted specified telecommunications development levy must be calculated in accordance with the following formula: a b × c is the CPI index number for the last quarter of the financial year preceding the relevant financial year is the CPI index number for the last quarter of the financial year that is 1 year before the financial year preceding the relevant financial year is the telecommunications development levy for the financial year preceding the relevant financial year.
where— a b c 46 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Schedule 3 Schedule 3 Further amendments to principal Act relating to telecommunications networks involving Crown funding s 31 Section 4 Insert after paragraph (g): “(gaa) provisions about undertakings that may be given con- cerning the supply of telecommunications services over networks constructed, in whole or in part, with Crown funding, restriction of regulation and information that must be disclosed if an undertaking is in force are set out in Part 4AA; and”.
Section 5 Insert in their appropriate alphabetical order: “FTTP access network or fibre-to-the-premises access net- work has the meaning set out in section 156AB “FTTP service provider or fibre-to-the-premises service provider has the meaning set out in section 156AB “specified network has the meaning set out in section 156AB”.

Section 5 Definition of service provider: insert “, except in Part 4AA,” after “service provider”.
Schedule 3: Part 1 Clause 4: add: “(5) This clause is subject to section 156AR.” 47 Schedule 4 Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill Schedule 4 New Schedule 3C inserted s 32 Schedule 3C Specified entities ss 156AB, 156AZ Crown Fibre Holdings Limited 12 Wellington, New Zealand: Published under the authority of the New Zealand Government—2010 48