Unbundled layer 1 fibre service

Part 4AA of the Telecommunications Act 2001 (Act) required Chorus and the other Local Fibre Companies (LFCs) to give Deeds of Open Access Undertakings (known as the ‘Fibre Deeds’) in relation to the supply of wholesale telecommunications services using fibre networks constructed with Crown investment funding as part of the Ultra-fast Broadband (UFB) Initiative. The Fibre Deeds require these wholesale services to be supplied on a non-discriminatory and equivalent basis. Since 1 January 2020, Chorus and the LFCs have also been obliged under the Fibre Deeds to offer a point-to-multipoint layer 1 fibre access service (PON Fibre Access Service) on their UFB1 networks.

The Act gives the Commission a particular role in the context of the PON Fibre Access Service:

• we can assess whether the offers made by Chorus and the LFCs comply with their obligations under the Fibre Deeds – in particular, the equivalence and non-discrimination obligations, and
• if we consider that a breach of the Fibre Deeds is likely to occur or has occurred, we can decide whether to bring enforcement action against Chorus and the LFCs.

However, the Act and the Fibre Deeds do not allow the Commission to set the price or non-price terms for the PON Fibre Access Service.

In April 2019, Vocus and Vodafone sent a letter and an expert report by Network Strategies to the Commission, outlining their concerns about Chorus’ proposed PON Fibre Access Service price and pricing approach.

In response, we have developed guidance on our interpretation of what the equivalence and non-discrimination obligations require of telecommunications network operators. This guidance is intended to assist interested parties to understand our approach to equivalence and non-discrimination obligations when exercising our monitoring and enforcement powers under the Act.

We have also published information sheets designed to explain the key concepts in equivalence and non-discrimination to industry participants.

The guidance is general in nature, and is intended to apply to all forms of telecommunications regulation, including Chorus’ copper deeds. In May 2020, we announced that we would be using the guidance in a compliance assessment of the non-price terms of PON Fibre Access Service offers. Further details of that compliance assessment can be found in the case register on the Commission’s website.