6Direction—bank guarantee for instalment payments

6 Direction—bank guarantee for instalment payments

(1) These directions are given to the ACMA under subsection 14(1) of the ACMA Act. Payment of spectrum access charges in instalments—amounts secured by guarantee (2) I direct the ACMA to require the provision of a bank guarantee at the time and on the terms set out in subsection (3) as a precondition to reaching an agreement for the payment of a relevant spectrum access charge in instalments as set out in section 5.

Note: Under subsection 62(2) of the Act, the ACMA is not required to issue a spectrum licence unless the person to whom it is allocated either pays the spectrum access charge for issuing the licence, or reaches an agreement with the ACMA for the payment of that charge.

(3) For the purposes of subsection (2), the bank guarantee: (a) must be required to be provided prior to the day on which the relevant spectrum licence is issued; (b) must be required to be provided by the person liable to pay the charge for, and only for, the period during which the whole or part of a relevant spectrum access charge remains owing by that person; and (c) must provide security to the Commonwealth for an amount equal to 5% of the amount of the relevant spectrum access charge still owing to the Commonwealth at any point in time.

Note: Example: If the second, third, fourth and fifth instalments total $812,800:

(a) prior to payment of any amount of the second instalment, the bank guarantee must provide security for an amount of $40,640;
(b) following payment of the second instalment amount, and prior to payment of any amount of the third instalment, the bank guarantee must provide security for an amount of $30,480;
(c) following payment of the third instalment amount, and prior to payment of any amount of the fourth instalment, the bank guarantee must provide security for an amount of $20,320; and
(d) following payment of the fourth instalment amount, and prior to payment of any amount of the fifth instalment, the bank guarantee must provide security for an amount of $10,160.

Licence condition to provide and maintain bank guarantee (4) I direct the ACMA, in issuing a relevant spectrum licence for which the relevant spectrum access charge is to be paid in instalments as set out in section 5, to: (a) consider whether it thinks fit that the licence include a condition with the effect of requiring the licensee to ensure that a bank guarantee on the terms set out in paragraph 3(c) is in force at all times during the period referred to in paragraph (3)(b); and (b) if the ACMA thinks fit that the licence include the condition referred to in paragraph (a)—include such a condition in that licence.

Note: Section 71 of the Act provides that the ACMA may include such other conditions (being conditions in addition to those referred to in sections 66 to 69A) as it thinks fit.