Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003
1Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003
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Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003
as amended
made under subsection 20B (1) of the
Telecommunications (Consumer Protection and Service Standards) Act 1999
This compilation was prepared on 20 June 2005
taking into account amendments up to Telecommunications Universal Service Obligation (Eligible Revenue) Amendment Determination 2005 (No. 1)
Prepared by the Office of Legislative Drafting and Publishing,
Attorney-General’s Department, Canberra
This Determination is the Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003.
2 Commencement [see Note 1]
This Determination commences on gazettal.
3 Application
(1) This Determination, as in force immediately before the commencement of the Telecommunications Universal Service Obligation (Eligible Revenue) Amendment Determination 2004 (No. 1), applies to the eligible revenue period beginning on 1 July 2002.
(2) This Determination, as amended by the Telecommunications Universal Service Obligation (Eligible Revenue) Amendment Determination 2004 (No. 1), applies to the eligible revenue period beginning on 1 July 2003.
(3) This Determination, as amended by the Telecommunications Universal Service Obligation (Eligible Revenue) Amendment Determination 2005 (No. 1) applies to the eligible revenue period beginning on 1 July 2004 and subsequent eligible revenue periods.
(1) The Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2002 is repealed.
(2) However, that Determination continues to apply in relation to the eligible revenue period starting on 1 July 2001 and ending on 30 June 2002.
5 Definition
In this Determination:
accounting on a group basis, for a participating person, has the meaning given by section 10.
Act means the Telecommunications (Consumer Protection and Service Standards) Act 1999.
Australia has the meaning given by the Telecommunications Act.
body means any:
(a) legal arrangement; or
(b) administrative arrangement; or
(c) fiduciary arrangement; or
(d) organisational structure; or
(e) other party (including a person);
that has the capacity to allocate scarce resources in order to achieve objectives, whether within or outside Australia.
boundary of a telecommunications network has the meaning given by section 22 of the Telecommunications Act.
bundled revenue has the meaning given by section 12.
carriage service provider has the meaning given by the Telecommunications Act.
carrier has the meaning given by the Telecommunications Act.
carrier licence means a licence granted under section 56 of the Telecommunications Act.
company interests has the meaning given by the Broadcasting Services Act 1992.
consolidated related party, in relation to a participating person, means an entity:
(a) that is not the participating person; and
(b) the revenue of which is included in the annual consolidated financial statements of the participating person’s ultimate Australian parent entity.
content service has the meaning given by the Telecommunications Act.
customer equipment has the meaning given by the Telecommunications Act.
declared related party has the meaning given by section 6.
declared related party factor, for a declared related party, means the factor calculated in accordance with section 7 for that party.
entity means anything defined as an entity in the accounting standards mentioned in section 334 of the Corporations Act 2001.
exempt base station has the meaning given by subsection 34 (2) of the Telecommunications Act.
gross telecommunications sales revenue has the meaning given by section 20.
initial sales revenue has the meaning given by section 14.
inter-person input payment means a payment of a kind described in section 9.
listed carriage service has the meaning given by the Telecommunications Act.
net telecommunications sales revenue has the meaning given by section 34.
non-telecommunications sales revenue has the meaning given by section 8
subscription broadcasting service has the meaning given by the Broadcasting Services Act 1992.
Telecommunications Act means the Telecommunications Act 1997.
telecommunications industry has the meaning given by the Telecommunications Act.
telecommunications sales revenue means sales revenue earned from an activity in the telecommunications industry.
ultimate Australian parent entity, in relation to a participating person, means the entity:
(a) described in that way under accounting methods commonly used in Australia; and
(b) in the financial statements of which the participating person’s revenue is reported.
Note Several other words and expressions used in this Determination have the meaning given by section 5 of the Act. For example:
Note: eligible revenue
Note: eligible revenue period
Note: participating person.
6 Declared related parties
(1) An entity is a declared related party for the whole of an eligible revenue period if it:
(a) is not:
(i) a participating person; or
(ii) a consolidated related party in relation to a participating person; and
(b) is owned, at any time during an eligible revenue period, by a body that owns a participating person at any time during the same eligible revenue period; and
(c) has telecommunications sales revenue in Australia at any time during the same eligible revenue period.
(2) An entity is a declared related party for any part of an eligible revenue period during which the entity:
(a) is not:
(i) a carrier; or
(ii) a consolidated related party in relation to a participating person; or
(iii) a carriage service provider in relation to which a determination under paragraph 20A (1) (b) of the Act is in force; and
(b) is owned by a body that owns a participating person at any time during the same eligible revenue period; and
(c) has telecommunications sales revenue in Australia.
(3) For subsection (1):
(a) a body owns a declared related party or a participating person if the body has company interests in the declared related party or participating person that are greater than 49% of the declared related party or participating person; and
(b) company interests may be traced in the same manner as company interests may be traced for Part 4 of Schedule 1 to the Broadcasting Services Act 1992.
(4) The ACA may, in writing:
(a) specify a participating person and 1 or more entities other than a consolidated related party; and
(b) declare that each entity is a declared related party for the person.
(5) The ACA may, in writing:
(a) specify 1 or more kinds of entities other than a consolidated related party; and
(b) declare that each entity is a declared related party for 1 or more participating persons, or for all participating persons.
7 Declared related party factor
The declared related party factor for a declared related party is calculated using the formula:
party interest participating person interest
where:
party interest is the proportion of the declared related party that is owned by the body mentioned in paragraph 6 (1) (b) or 6 (2) (b) in relation to the declared related party or, if there is more than 1 such body, the body that has the greater company interest in the declared related party.
participating person interest is the proportion of the participating person that is owned by the body mentioned in paragraph 6 (1) (b) or 6 (2) (b) in relation to declared related party or, if there is more than 1 such body, the body that has the greater company interest in the participating person.
Note The sales revenue of a consolidated related party will already be included in the consolidated financial statements used for section 11.
8 Non-telecommunications revenue
(1) An amount of revenue is non-telecommunications sales revenue if it is earned from an activity outside the telecommunications industry.
Examples of non-telecommunications sales revenue
1 Revenue from providing electricity, gas or water connections.
2 Revenue from selling electricity, gas or water.
(2) The ACA may, in writing, declare that a specified amount, or kind of amount, is non-telecommunications sales revenue.
(3) The amount may include the value of a benefit or service.
(4) The ACA must also state, in writing, how it worked out the value of a benefit or service declared to be non‑telecommunications sales revenue.
Note The ACA will accept an amount as non-telecommunications sales revenue if it was worked out on the basis of a declaration.
Note: The ACA cannot guarantee that it will accept an amount as non‑telecommunications sales revenue if it was not worked out on the basis of a declaration.
9 Inter-person input payments
(1) In this Determination, a reference to an inter-person input payment is a reference to either of the following amounts:
(a) an amount to which the following provisions apply:
(i) the amount is paid or payable by a participating person (the first person) for an act done by a participating person (the second person), or a consolidated related party or a declared related party in relation to the second person;
(ii) the act allows the first person, or a consolidated related party or a declared related party in relation to the first person, to provide a listed carriage service;
(iii) the second person is required to include the amount in its gross telecommunications sales revenue, and does so without deducting the amount under any of sections 22 to 28 (inclusive);
(b) an amount to which the following provisions apply:
(i) the amount is paid or payable by a consolidated related party or a declared related party in relation to a participating person (the first person) for an act done by a participating person (the second person), or a consolidated related party or a declared related party in relation to the second person;
(ii) the act allows the consolidated related party or declared related party that incurred the amount, or the first person, to provide a listed carriage service;
(iii) the second person is required to include the amount in its gross telecommunications sales revenue, and does so without deducting the amount under any of sections 22 to 28 (inclusive).
Examples of inter-person input payments
1 A payment for interconnection.
2 A payment for a carriage or other service for which access has been declared under Part XIC of the Trade Practices Act 1974.
3 A payment for a carriage or other service bought on a wholesale basis.
4 A payment for a retail carriage or other service that the participating person buys from the other participating person for the purpose of resale.
(2) The ACA may, in writing, declare that a specified amount, or kind of amount, is an inter-person input payment.
Part 2 Accounting concepts
10 Accounting on a group basis
(1) This section applies if:
(a) a participating person has the same ultimate Australian parent entity as 1 or more other participating persons; and
(b) the ultimate Australian parent entity’s annual consolidated financial statements include the sales revenue of the participating person, whether or not the statements include any revenue of entities other than the other participating persons mentioned in paragraph (a).
(2) The participating person may make all of the calculations required by this Determination in its own right, identifying and accounting for its own revenue and deductions, and those of any consolidated related parties and declared related parties in relation to the participating person, in accordance with this Determination.
(3) As an alternative to subsection (2), 2 or more participating persons with the same ultimate Australian parent entity may make all of the calculations required by Parts 3 and 4 of this Determination on a group basis, identifying and accounting for revenue and deductions as a whole.
Note Although participating persons are able to make calculations on a group basis as the first stage of calculating eligible revenue, the final stage of the eligible revenue process requires participating persons to identify their revenue on an individual basis: see Part 5.
(4) In this Determination, the use of the accounting arrangements in subsection (3) is accounting on a group basis.
11 Sales revenue
(1) For this Determination, the sales revenue of a participating person, or of a consolidated related party or declared related party in relation to a participating person, for an eligible revenue period is to be worked out using the sources mentioned in subsections (2) and (4) to identify the amount of revenue for the whole of the period (the relevant period), during the eligible revenue period, in which the participating person:
(a) holds a carrier licence; or
(b) if a determination under paragraph 20A (1) (b) of the Act is in force, is a carriage service provider.
(2) For subsection (1), the sources are:
(a) if the entity’s sales revenue is included in the annual consolidated financial statements of an ultimate Australian parent entity:
(i) if the most recent financial statements of the ultimate Australian parent entity for a period ending on or before the end of the eligible revenue period are required to be audited under the Corporations Act 2001 or any other law of the Commonwealth, a State or a Territory — those audited financial statements; and
(ii) in any other case — the most recent financial statements of the ultimate Australian parent entity for a period ending on or before the end of the eligible revenue period; or
(b) if the entity’s sales revenue is not included in the annual consolidated financial statements of an ultimate Australian parent entity:
(i) if the most recent financial statements of the participating person that include the participating person’s sales revenue for a period ending on or before the end of the eligible revenue period are required to be audited under the Corporations Act 2001 or any other law of the Commonwealth, a State or a Territory — those audited financial statements; and
(ii) in any other case — the most recent financial statements of the participating person that include the participating person’s sales revenue for a period ending on or before the end of the eligible revenue period; or
(c) for a declared related party:
(i) if the most recent financial statements of the declared related party that include the declared related party’s sales revenue for a period ending on or before the end of the eligible revenue period are required to be audited under the Corporations Act 2001 or any other law of the Commonwealth, a State or a Territory — those audited financial statements; and
(ii) in any other case — the most recent financial statements of the declared related party that include the declared related party’s sales revenue for a period ending on or before the end of the eligible revenue period.
(3) For subsection (1), revenue is revenue for a relevant period if the following conditions apply:
(a) the revenue is reported in:
(i) the last financial statements for a period ending on or before the end of the eligible revenue period in which the relevant period occurs; or
(ii) if that period is shorter than the relevant period, the periods covered by those financial statements and the financial statements for as many other periods as amount to, in total, a period of at least equal length to the relevant period;
(b) if those financial statements cover a period longer than the relevant period, the revenue was earned in a period, within the period covered by the financial statements, that:
(i) is of equal length to the relevant period; and
(ii) the ACA considers to be the most appropriate period, within the period covered by the financial statements, for matching with the relevant period.
Example
A body’s financial statements cover the period from 1 April in a year to 31 March in the following year. The relevant period runs from 1 July to 30 June. Although the first 3 months of the period covered by the financial statements are outside the relevant period, the revenue earned in those months might be considered to be part of the body’s eligible revenue for the relevant period, as those months may be considered the most appropriate period for matching with the corresponding months of the following year (since the financial statements for the latter period cannot be considered).
Note During an eligible revenue period, a participating person may change its ownership or management arrangements in a way that affects how its annual financial statements are prepared. For example:
Note: (a) for accounting purposes, the participating person may cease to report in its own right and start reporting as part of the consolidated group of an ultimate Australian parent entity; or
Note: (b) for accounting purposes, the participating person may cease to report as part of an ultimate Australian parent entity’s consolidated group and start reporting as an entity in its own right; or
Note: (c) the participating person may change the reporting date for its financial statements.
Note: If the ownership or management arrangements change, the information that identifies the participating person’s sales revenue for the relevant period may be found in 2 or more annual financial statements.
(4) If none of the sources mentioned in subsection (2) identifies the amount of an entity’s sales revenue for a relevant period, the sales revenue for that period is to be calculated using as many sources as are necessary to identify the entity’s sales revenue for the period.
12 Bundled revenue
(1) To work out an amount of revenue to be deducted under Part 3 or 4, it may be appropriate to:
(a) separate the deductible revenue, or a kind of deductible revenue, from other amounts with which the deductible revenue is bundled; and
(b) deal only with the deductible revenue.
(2) An amount of revenue is bundled revenue if it:
(a) comes from different sources or acts; and
(b) is received in a way that does not show how much of the amount came from the individual sources or acts.
(3) Bundled revenue may also include the value of a benefit or service.
(4) The ACA may, in writing, declare that a specified amount, or kind of amount, of revenue is bundled revenue.
(5) The ACA may make a declaration under subsection (4) in relation to revenue of a participating person, consolidated related party or declared related party.
(6) If the ACA makes a declaration under subsection (4), it must also declare that:
(a) specified amounts or proportions of the bundled revenue are deductible under Parts 3 and 4; or
(b) the amounts of the bundled revenue that are deductible should be worked out in a specified way.
Note The ACA will accept an amount from bundled revenue as a deduction if it was worked out on the basis of a declaration.
Note: The ACA cannot guarantee that it will accept an amount from bundled revenue as a deduction if it was not worked out on the basis of a declaration.
(7) If the ACA makes a declaration under subsection (4), it must state, in writing, how it worked out the value of a benefit or service included in the bundled revenue.
(8) If a participating person separates a deductible amount from bundled revenue for Part 3 or 4, the participating person must identify:
(a) the total amount of the bundled revenue; and
(b) the amount of bundled revenue that the person is deducting; and
(c) how the person worked out the deductible amount.
Note The eligible revenue return required under the Act may require the participating person to state:
Note: (a) a total amount of bundled revenue; and
Note: (b) the portion of each amount that the participating person is required or permitted to identify as revenue or as an amount that is not included in the person’s eligible revenue; and
Note: (c) how it calculated the amount.
Part 3 Gross telecommunications sales revenue
13 Purpose of Part 3
(1) The first step in calculating a participating person’s eligible revenue for an eligible revenue period is to calculate the person’s gross telecommunications sales revenue for that period.
(2) This Part sets out how a participating person’s gross telecommunications sales revenue is calculated.
14 Initial sales revenue
(1) For the participating person and each consolidated related party (if any), work out the entity’s sales revenue for the eligible revenue period in accordance with section 11.
Note See section 11 for the sources from which sales revenue is to be identified.
(2) For each declared related party (if any):
(a) work out the declared related party’s sales revenue for the eligible revenue period in accordance with section 11; and
(b) multiply that amount by the declared related party factor for that party.
(3) Add the amounts calculated under subsection (2) (if any) to the amounts identified under subsection (1).
(4) Subject to subsection (5), the result is the participating person’s initial sales revenue.
(5) The ACA may declare, in writing, that:
(a) a declared related party’s sales revenue is not part of the participating person’s initial sales revenue; or
(b) only a specified proportion of a declared related party’s sales revenue is part of the participating person’s initial sales revenue; or
(c) only a proportion of a declared related party’s sales revenue, worked out in a specified way, is part of the participating person’s initial sales revenue.
(6) The ACA may make a declaration under subsection (5) in relation to:
(a) 1 or more declared related parties specified in the declaration; or
(b) a specified kind of declared related party.
15 Non-telecommunications sales revenue
(1) Deduct from the initial sales revenue any amount that:
(a) is non-telecommunications sales revenue of the participating person or a consolidated related party; and
(b) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its initial sales revenue.
(2) Also deduct the result of multiplying any amount that:
(a) is non-telecommunications sales revenue of a declared related party; and
(b) the participating person wishes to deduct;
by the declared related party factor for that party.
Note For non-telecommunications sales revenue, see section 5.
(3) If the participating person wishes to deduct an amount (a deductible amount) from its initial sales revenue under this section, the deductible amount must not be greater than the total amount (if any) received by or on behalf of the participating person in connection with the activity that created the deductible amount.
Example
If a participating person supplies gas services at a price that includes a subsidy provided by or on behalf of the participating person:
Note: (a) the amount received by or on behalf of the participating person for the supply is a deductible amount; but
Note: (b) the amount of the subsidy is not a deductible amount if no amount is received by or on behalf of the participating person to represent the amount of the subsidy.
16 Other telecommunications sales revenue
(1) Add any amount of revenue that:
(a) is mentioned in the financial statements referred to in subsection 11 (2) or, if applicable, sources mentioned in subsection 11 (4); and
(b) could reasonably be described as telecommunications sales revenue of the participating person or a consolidated related party; and
(c) has not been identified as initial sales revenue under section 14.
(2) Also add the result of multiplying any amount of revenue that:
(a) is mentioned in the financial statements referred to in subsection 11 (2) or, if applicable, sources mentioned in subsection 11 (4); and
(b) could reasonably be described as telecommunications sales revenue of a declared related party; and
(c) has not been identified as initial sales revenue under section 14;
by the declared related party factor for that party.
(3) The ACA may make a declaration mentioned in subsection (4) in writing for:
(a) 1 or more participating persons, consolidated related parties or declared related parties specified in the declaration; or
(b) a specified kind of participating person, consolidated related party or declared related party.
(4) The ACA may declare that:
(a) the value of a benefit or service received by an entity; or
(b) a specified proportion of the value of a benefit or service received by an entity; or
(c) a proportion of the value of a benefit or service received by an entity, worked out in a specified way;
is telecommunications sales revenue.
(5) The ACA must explain in the declaration how it worked out:
(a) the value of any benefit or service mentioned in the declaration; and
(b) any proportion of revenue or value mentioned in the declaration.
Note The effect of a declaration is that a participating person must include any telecommunications sales revenue mentioned in the declaration as part of its gross telecommunications sales revenue.
Note: The ACA will accept the telecommunications sales revenue of a person or party as part of the participating person’s gross telecommunications sales revenue if it was worked out on the basis of a declaration.
Note: The ACA cannot guarantee that it will accept the telecommunications sales revenue of a person or party as part of the participating person’s gross telecommunications sales revenue if it was not worked out on the basis of a declaration.
17 Revenue before person becomes carrier or carriage service provider
(1) Deduct any amount of telecommunications sales revenue that:
(a) was earned by a participating person or a consolidated related party in relation to the participating person at any time during the eligible revenue period before the day on which the participating person became a carrier or, if a determination under paragraph 20A (1) (b) of the Act is in force, a carriage service provider; and
(b) the participating person wishes to deduct.
(2) Also deduct the result of multiplying any amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person at any time during the eligible revenue period before the day on which the participating person became a carrier or, if a determination under paragraph 20A (1) (b) of the Act is in force, a carriage service provider; and
(b) the participating person wishes to deduct;
by the declared related party factor for that party.
(3) However, the participating person may not use subsection (1) or (2) to deduct:
(a) an amount that was earned before the day on which the person or party became a carrier or carriage service provider if the amount relates to an activity in the telecommunications industry that was required to be performed on or after that day; or
(b) an amount that was earned during a period in which any consolidated party in relation to the participating person held a carrier licence; or
(c) an amount that was earned during a period in which:
(i) a determination under paragraph 20A (1) (b) of the Act was in force; and
(ii) any consolidated party in relation to the participating person was a carriage service provider.
18 Revenue after person ceases to be carrier or carriage service provider
(1) Deduct any amount of telecommunications sales revenue that:
(a) was earned by a participating person or a consolidated related party in relation to the participating person at any time during the eligible revenue period after the day on which the participating person ceased being a carrier or, if a determination under paragraph 20A (1) (b) of the Act is in force, a carriage service provider; and
(b) the participating person wishes to deduct.
(2) Also deduct the result of multiplying any amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person at any time during the eligible revenue period after the day on which the participating person ceased being a carrier or, if a determination under paragraph 20A (1) (b) of the Act is in force, a carriage service provider; and
(b) the participating person wishes to deduct;
by the declared related party factor for that party.
(3) However, the participating person may not use subsection (1) or (2) to deduct;
(a) an amount that was earned after the day on which the person or party ceased being a carrier or carriage service provider if the amount relates to an activity in the telecommunications industry that was required to be performed on or before that day; or
(b) an amount that was earned during a period in which any consolidated party in relation to the participating person held a carrier licence; or
(c) an amount that was earned during a period in which:
(i) a determination under paragraph 20A (1) (b) of the Act was in force; and
(ii) any consolidated party in relation to the participating person was a carriage service provider.
19 Declarations about revenue
(1) The ACA may declare, in writing, that a specified amount is part of a participating person’s gross telecommunications sales revenue for an eligible revenue period.
(2) The ACA may declare, in writing, that a specified kind of amount is part of a participating person’s gross telecommunications sales revenue for an eligible revenue period.
Examples of amounts that may be declared
1 Revenue from sales of goods and assets.
2 Revenue from leases and rentals (including rental of leased lines and telephone handsets).
3 Revenue from interest and dividends.
Note These examples represent revenue sources that might not be included in the consolidated or other financial statements to be used by a participating person under the title of ‘sales revenue’, or revenue sources that are otherwise improperly omitted.
Note: The ACA’s power to declare a revenue source will allow it to make it clear, in a disagreement with a participating person, that the ACA regards the revenue as gross telecommunications sales revenue. The ACA’s power will also allow it to take account of revenue that is not sales revenue, but should, in the ACA’s view, still be included in the participating person’s gross telecommunications sales revenue.
(3) The ACA may declare, in writing, that the value of a specified benefit or service is part of a participating person’s gross telecommunications sales revenue for a financial year.
(4) The ACA may declare, in writing, that the value of a specified kind of benefit or service is part of a participating person’s gross telecommunications sales revenue for a financial year.
(5) The ACA must also state, in writing, how it worked out the value of the benefit or service.
Note The benefit or service, or kind of benefit or service, includes:
Note: (a) a benefit or service received by a participating person (for example, a payment in kind); and
Note: (b) a benefit or service provided by the participating person without receiving remuneration for it at reasonable market rates (for example, a subsidy in kind).
20 Gross telecommunications sales revenue
The result of adding any amounts identified under sections 16 and 19 to the amount identified under section 14, and subtracting any amounts identified under sections 15, 17 and 18, is the participating person’s gross telecommunications sales revenue for the eligible revenue period.
Part 4 Net telecommunications sales revenue
21 Purpose of Part 4
(1) After calculating a participating person’s gross telecommunications sales revenue for an eligible revenue period, the next step is to work out the participating person’s net telecommunications sales revenue for that period by deducting amounts from the gross telecommunications sales revenue.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) This Part sets out how net telecommunications sales revenue is calculated.
22 Deductions from gross telecommunications sales revenue — overseas activities
(1) Deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person from an act that was:
(i) carried out in a place outside Australia; and
(ii) part of the participating person’s activities outside Australia in the telecommunications industry; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note 1 A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
Note 2 Although satellites, cables and other facilities may be located outside Australia, their use may be related to the participating person’s Australian operations. Revenue earned from these operations would not generally be deductible.
(1A) Deduct each amount of telecommunications sales revenue that:
(a) was earned by a consolidated related party in relation to the participating person, from an act that was:
(i) carried out in a place outside Australia; and
(ii) part of the consolidated related party’s activities outside Australia in the telecommunications industry; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note 1 A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
Note 2 Although satellites, cables and other facilities may be located outside Australia, their use may be related to the participating person’s Australian operations. Revenue earned from these operations would not generally be deductible.
(2) Also deduct the result of multiplying each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person from an act that was:
(i) carried out in a place outside Australia; and
(ii) part of the declared related party’s activities outside Australia in the telecommunications industry; and
(b) is (after having been multiplied by the declared related party factor for that party) included in the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(3) However, the participating person may not use subsection (1), (1A) or (2) to deduct an amount earned from supplying to or from Australia a carriage service mentioned in paragraph 16 (1) (b) or (c) of the Telecommunications Act.
Examples of activities for which revenue cannot be deducted
1 Customer charges for international telephone calls.
2 Settlement payments made to the participating person by a foreign participating person.
23 Deductions from gross telecommunications sales revenue — acts in Australia for services outside Australia
(1) Deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person, or a consolidated related party in relation to the participating person, from an act carried out:
(i) in Australia; and
(ii) solely for the purposes of the supply of a carriage service originating and terminating outside Australia; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Example
Revenue from providing in Australia management, switching or transit carriage services for a carriage service originating and terminating outside Australia.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct the result of multiplying each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person from an act carried out:
(i) in Australia; and
(ii) solely for the purposes of the supply of a carriage service originating and terminating outside Australia; and
(b) is (after having been multiplied by the declared related party factor for that party) included in the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
24 Deductions from gross telecommunications sales revenue — customer equipment
(1) Deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person, or a consolidated related party in relation to the participating person, from:
(i) selling, installing, insuring, repairing or maintaining customer equipment; or
(ii) renting customer equipment to a customer; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct the result of multiplying each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person from:
(i) selling, installing, insuring, repairing or maintaining customer equipment; or
(ii) renting customer equipment to a customer; and
(b) is (after having been multiplied by the declared related party factor for that party) included in the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
25 Deductions from gross telecommunications sales revenue — levy credit balance
(1) Deduct each amount of telecommunications sales revenue that:
(a) was a payment of levy credit balance received under section 21C of the Act by the participating person, or a consolidated related party in relation to the participating person; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct the result of multiplying each amount of telecommunications sales revenue that:
(a) was a payment of levy credit balance received under section 20J of the Act by a declared related party in relation to the participating person; and
(b) is (after having been multiplied by the declared related party factor for that party) included in the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
26 Deductions from gross telecommunications sales revenue — content services
(1) Deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person, or a consolidated related party in relation to the participating person, for the content of a content service; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Examples
1 A program, including a program broadcast on a subscription broadcasting service.
2 A message on a 190 telephone service.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct the result of multiplying each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person for the content of a content service; and
(b) is (after having been multiplied by the declared related party factor for that party) included in the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(3) However, the participating person may not use subsection (1) or (2) to deduct an amount earned from carrying a content service.
27 Deductions from gross telecommunications sales revenue — exempt base station
(1) Deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person, or a consolidated related party in relation to the participating person, from the use of an exempt base station during the eligible revenue period; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct the result of multiplying each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person from the use of an exempt base station during the eligible revenue period; and
(b) is (after having been multiplied by the declared related party factor for that party) included in the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Example
Using the station to distribute a subscription broadcasting service by microwave or other radiocommunications means.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
28 Deductions from gross telecommunications sales revenue — infrastructure revenue
(1) Deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person, or a consolidated related party in relation to the participating person, from:
(i) the construction or installation of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; or
(ii) the management of the construction or installation of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person from:
(i) the construction or installation of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; or
(ii) the management of the construction or installation of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; and
(b) the participating person has multiplied by the declared related party factor for the declared related party; and
(c) is part of the participating person’s gross telecommunications sales revenue; and
(d) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(3) Also deduct each amount of telecommunications sales revenue that:
(a) was earned by the participating person, or a consolidated related party in relation to the participating person, from:
(i) the maintenance of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; or
(ii) the management of the maintenance of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; and
(b) is part of the participating person’s gross telecommunications sales revenue; and
(c) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(4) Also deduct each amount of telecommunications sales revenue that:
(a) was earned by a declared related party in relation to the participating person from:
(i) the maintenance of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; or
(ii) the management of the maintenance of the infrastructure of a telecommunications network on the network side of the boundary of a telecommunications network; and
(b) the participating person has multiplied by the declared related party factor for the declared related party; and
(c) is part of the participating person’s gross telecommunications sales revenue; and
(d) the participating person wishes to deduct.
Note 1 A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
Note 2 Section 28 does not allow for the deduction of revenue earned from the leasing of infrastructure, or from the supply of a service using infrastructure.
(a) is made while both the participating person and the second person in relation to the payment, hold carrier licences or, if a determination under paragraph 20A (1) (b) of the Act is in force, are carriage service providers; and
(b) is made by the participating person or a consolidated related party in relation to the participating person; and
(c) the participating person wishes to deduct.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
(2) Also deduct the result of multiplying each inter-person input payment that:
(a) is made while both the participating person and the second person, in relation to the payment, hold carrier licences or, if a determination under paragraph 20A (1) (b) of the Act is in force, are carriage service providers; and
(b) is made by a declared related party in relation to the participating person; and
(c) the participating person wishes to deduct;
by the declared related party factor for that party.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
30 Other input amounts
(1) The ACA may, in writing, declare that a specified input cost or amount, other than an inter-person input amount, is an input amount.
(2) The ACA may, in writing, declare that a specified kind of input cost or amount, other than an inter-person input amount, is an input amount.
(3) A participating person may deduct an input amount declared by the ACA.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue.
31 Limit on deductions
(1) If a participating person wishes to deduct an amount (a deductible amount) from its gross telecommunications sales revenue under any of sections 22 to 28, the deductible amount must not be greater than the total amount (if any) received by or on behalf of the participating person in connection with the activity that created the deductible amount.
Example
If a participating person sells customer equipment at a price that includes a subsidy provided by or on behalf of the participating person:
Note: (a) the amount received by or on behalf of the participating person for the sale is a deductible amount; but
Note: (b) the amount of the subsidy is not a deductible amount if no amount is received by or on behalf of the participating person to represent the amount of the subsidy.
(2) If a participating person wishes to deduct an inter-person input payment from its gross telecommunications sales revenue, the amount to be deducted must not be greater than the total amount (if any) paid by or on behalf of the participating person in connection with the activity that led to the inter‑person input payment.
Example
If a participating person makes a payment for interconnection at a price that includes a subsidy provided by the other party:
Note: (a) the amount paid for the interconnection is a deductible amount; but
Note: (b) the amount of the subsidy is not a deductible amount if no amount is paid by or on behalf of the participating person to represent the amount of the subsidy.
32 Suspension of deduction entitlements
(1) The ACA may, in writing, declare that 1 or more participating persons specified in the declaration are not entitled to deduct a specified amount or payment under this Part.
(2) The ACA must state that the declaration is to have effect:
(a) for any financial year mentioned in the declaration; or
(b) while the declaration is in force.
33 Declarations about deductible revenue
(1) The ACA may declare, in writing, that a specified amount of a participating person’s gross telecommunications sales revenue may be deducted.
(2) The ACA may declare, in writing, that a specified kind of amount in a participating person’s gross telecommunications sales revenue may be deducted.
Note The amount may include the value of a benefit or service.
34 Net telecommunications sales revenue
The result of deducting any amounts identified under sections 22 to 30, and 33, from the participating person’s gross telecommunications revenue is the participating person’s net telecommunications sales revenue for the eligible revenue period.
Note A participating person is not required to deduct an amount from its gross telecommunications sales revenue. Therefore, it is possible that the participating person’s gross and net telecommunications sales revenue will be the same.
Part 5 Eligible revenue
35 Purpose of Part 5
(1) After the participating person has calculated its net telecommunications sales revenue for an eligible revenue period, the participating person must calculate its eligible revenue for the eligible revenue period.
(2) This Part sets out how that is done.
36 Revenue accounted for on a group basis
(1) If the net telecommunications sales revenue of 2 or more participating persons has been accounted for on a group basis, identify from the accounts that were prepared on the group basis:
(a) how much of the net telecommunications sales revenue to which those accounts relate is the participating person’s net telecommunications sales revenue; and
(b) how much of the net telecommunications sales revenue to which those accounts relate is the net telecommunications sales revenue of the other participating person or persons to which those accounts relate.
(2) The total of the amounts of net telecommunications sales revenue identified in relation to each participating person under subsection (1) must equal the net telecommunications sales revenue of the group.
(3) The ACA may, in writing, declare that the eligible revenue of the participating person is to be attributed in a particular way when it is being worked out by the person as a member of a group.
Note 1 The ACA will accept an amount as eligible revenue if it was worked out on the basis of a declaration.
Note: The ACA cannot guarantee that it will accept an amount as eligible revenue if it was not worked out on the basis of a declaration.
Note 2 The eligible revenue return required under the Act may require the participating person to state:
Note: (a) the amounts identified for section 36; and
Note: (b) how it calculated the amounts.
Note 3 If a participating person’s net telecommunications sales revenue has been accounted for independently of any other participating persons, proceed directly to section 37.
37 Threshold amount
For subsection 20F (2) of the Act, a participating person’s net telecommunications revenue, after applying section 36 (if applicable), is the amount that must be reduced:
(a) if the person’s net telecommunications revenue, after applying section 36 (if applicable), is less than the threshold amount — to zero; or
(b) in any other case — by the threshold amount.
Note Subsection 20F (2) authorises the Minister to determine a threshold amount. If a participating person’s eligible revenue is less than the threshold amount, the participating person’s eligible revenue is to be assessed as zero. If the participating person’s eligible revenue is greater than or equal to the threshold amount, it must be reduced by the threshold amount.
38 Eligible revenue
(1) If the ACA is satisfied that the amount worked out by applying section 36 (if applicable) and section 37 to the participating person’s net telecommunications sales revenue is zero or more, the result is the participating person’s eligible revenue for the eligible revenue period.
(2) If the ACA is satisfied that the amount worked out by applying section 36 (if applicable) and section 37 to the participating person’s net telecommunications sales revenue is less than zero, the participating person’s eligible revenue for the eligible revenue period is taken to be zero.
Note A participating person is not required to deduct an amount from its net telecommunications sales revenue. Therefore, it is possible that the participating person’s net telecommunications sales revenue and eligible revenue will be the same.
Part 6 Miscellaneous
39 Declarations of general application
(1) This section applies if the ACA proposes to make a declaration mentioned in Schedule 1 (a declaration of general application).
(2) Before the ACA makes the declaration, it must consult each participating person.
(3) The ACA must:
(a) give the participating person a notice that the ACA proposes to make the declaration; and
(b) invite the person to comment on the proposal, and make submissions.
(4) The ACA must allow the person at least 14 days after the date of the notice to comment and make submissions.
(5) If the ACA makes a declaration after consulting each participating person, the ACA must give the person a notice stating that:
(a) it has made the declaration; and
(b) the declaration is available from the ACA, and may also be inspected on the ACA’s Internet site.
40 Other declarations
(1) This section applies if the ACA proposes to make a declaration that is not a declaration of general application.
(2) Before the ACA makes the declaration, it must consult each participating person to which the declaration would apply.
(3) The ACA must:
(a) give the participating person a notice that the ACA proposes to make the declaration; and
(b) invite the person to comment on the proposal, and make submissions.
(4) The ACA must allow the person at least 14 days after the date of the notice to comment and make submissions.
(5) If the ACA makes a declaration after consulting the participating person, the ACA must give the person a notice stating that:
(a) it has made the declaration; and
(b) the declaration is available from the ACA, and may also be inspected on the ACA’s Internet site.
(6) The ACA:
(a) may consult other participating persons, to which the declaration would not apply, about the declaration; and
(b) is not required to comply with subsections (3), (4) and (5) when consulting the other persons.
41 Review of decisions
Application may be made to the Administrative Appeals Tribunal for review of a decision, relating to an amount, that is set out in a declaration that is not a declaration of general application
Note There is no procedure for the review by the Administrative Appeals Tribunal of an amount specified in a declaration of general application.
Schedule 1 Declarations of general application
(section 39)
1 A declaration under subsection 6 (5) that a specified kind of person is a declared related party for all participating persons.
2 A declaration under section 8 that a specified kind of amount is non‑telecommunications sales revenue for all participating persons.
3 A declaration under subsection 9 (2) that a specified kind of amount is an inter-person input payment for all participating persons.
4 A declaration under subsection 12 (4) that a specified kind of amount is bundled revenue for all participating persons.
5 A declaration under subsection 14 (5) for a specified kind of declared related party.
6 A declaration under subsection 19 (2) that a specified kind of amount is part of the gross telecommunications sales revenue for all participating persons.
7 A declaration under subsection 19 (4) that the value of a specified kind of benefit or service is part of gross telecommunications sales revenue for all participating persons.
8 A declaration under subsection 30 (2) that a specified kind of amount, other than an inter-person input payment, is an input amount for all participating persons.
9 A declaration under subsection 32 (1) that all participating persons are not entitled to deduct a specific payment or amount under Part 4.
10 A declaration under subsection 33 (2) that a specified kind of amount in any participating person’s gross telecommunications sales revenue may be deducted.
Notes to the Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003
Note 1
Note: The Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003 (in force under subsection 20B (1) of the Telecommunications (Consumer Protection and Service Standards) Act 1999) as shown in this compilation is amended as indicated in the Tables below.
Note: Under the Legislative Instruments Act 2003, which came into force on 1 January 2005, it is a requirement for all non-exempt legislative instruments to be registered on the Federal Register of Legislative Instruments.
Note: > Note: Table of Instruments
Title
Date of notificationin Gazette orFRLI registration
Date ofcommencement
Application, saving ortransitional provisions
Telecommunications Universal Service Obligation (Eligible Revenue) Determination 2003