The Commerce Commission (“Commission”) gives notice that it has determined input methodologies relating to fibre fixed line access services (FFLAS) in accordance with Part 6 of the Telecommunications Act 2001 (“Act”). The input methodologies have been published in the Fibre Input Methodologies Determination 2020 [2020] NZCC 21 (“IM determination”).

Summary of IM Determination

The IM determination includes methodologies for:

• evaluating or determining the following matters in respect of the supply of FFLAS:
  • cost of capital;
  • valuation of assets;
  • allocation of common costs; and
  • treatment of taxation;
• quality dimensions;
• regulatory processes and rules; and
• capital expenditure projects.

The IM determination does not include a methodology for determining the initial value of the financial loss asset. The Commission intends to publish an amendment to the IM determination on 3 November 2020, containing a methodology for determining the initial value of the financial loss asset.

Material Incorporated by Reference

Pursuant to section 223(b) of the Act and Schedule 5 of the Commerce Act 1986, the Commission gives notice that it has incorporated material by reference into the IM determination. The material incorporated by reference is the New Zealand Equivalent to International Accounting Standard 24, Related Party Disclosures (NZ IAS 24), issued by the New Zealand Accounting Standards Board of the External Reporting Board in November 2009, incorporating amendments to 31 December 2015, under section 24(1)(a) of the Financial Reporting Act 1993 (“NZ IAS 24”).

Further Information

A copy of the IM determination and the accompanying reasons paper is available on the Commission’s website: https://comcom.govt.nz/regulated-industries/telecommunications/projects/fibre-input-methodologies.

The NZ IAS 24 is available on the XRB publication website: www.xrb.govt.nz. The NZ IAS 24 is also available for inspection during the hours of 8.30am to 5.00pm, Monday to Friday, by appointment, at the Commerce Commission, Level 9, 44 The Terrace, Wellington.

A document explaining our incorporation by reference of NZ IAS 24 into the IM determination is available on the Commission’s website: https://comcom.govt.nz/regulated-industries/telecommunications/projects/fibre-input-methodologies.