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Business NZ members break ranks over regulation

02 Jun 2010

The New Zealand Council for Infrastructure Development(NZCID), whose membership includes major banks, engineering companies, lines companiesand law firms, has written to the Commerce Commission supporting its recommendationto regulate MTRs – the fee telcos charge each other to terminate traffic oneach other’s networks.

The letter is one of six cross-submissions that have beenposted on the Commission’s website this week. In it NZCID CEO Stephen Selwoodwrites that regulation of MTRs is in the best long term interest of end-users.He notes that this position is contrary to that of Business NZ, of which NZCID isan associate member. Business NZ, in an earlier submission, recommended thatthe issue be reviewed by the New Zealand Productivity Commission when it isestablished early next year.

Selwood writes: “NZCID generally supports the position takenby Business NZ that the cost benefit of regulation should be a guidingdeterminant for the introduction of regulation. However we wish to advise thatNZCID’s interests are not aligned with the Business NZ position on the issue ofregulation of mobile termination rates, on this occasion.”

Another Business NZ member, Rank Group/Carter Holt Harvey, alsodistances itself from the Business NZ position. It’s CIO Pat O’Connell – who isalso the Chairman of TUANZ – writes in its cross-submission: “I wish to advise that the positionmaintained by our organisation is at odds with the statements issued in theBusiness New Zealand letter of 24 May regarding the draft reconsiderationreport on Mobile Termination. We believe regulation is required to correct whatcan only be described as market failure in the area of MTR.”

Submissions and cross-submissions have been posted on theCommission’s website here.

The final reconsideration report on MTRs isexpected to be delivered to the ICT Minister Steven Joyce early this month.