Is Australia ready for 5G: A new government and a new approach to spectrum regulation?

The Australian Department of Communications issued a paper '5G – Enabling the future economy' in late 2017. That paper was intended to be the roadmap for the regulatory steps the Government proposed to take to support the rollout of 5G in Australia.

The paper announced, among other matters, that the Government would support the early deployment of 5G in Australia by modernising the regulatory framework for the allocation and management of spectrum. 5G cannot be rolled out unless the necessary spectrum is available. Therefore ensuring spectrum availability, on a timely and efficient basis, is one of the most important regulatory actions that the Government can take.

This article looks at, now that the dust has settled on the recent federal election, where we are in relation to this important commitment.

Why re-write the spectrum legislation?

The Radiocommunications Act 1992 (Cth) (Act) provides the framework for the allocation, use and management of spectrum. It has been in place, with only minimal amendment, for over 25 years.

The Act was reviewed by the Department of Communications in 2014/2015. In 2015 the Government agreed, in responding to that review, to:

• replace the current legislative arrangements with new legislation that removes prescriptive processes and streamlines licensing for a simpler and more flexible framework
• better integrate the management of public sector and broadcasting spectrum to improve the consistency and integrity of the framework
• review spectrum pricing to ensure consistent and transparent arrangements to support the efficient use of spectrum and secondary markets. 

However, it was not until May 2017 that an exposure draft of the proposed Radiocommunications Bill, excluding the broadcasting and transitional provisions, was released for public consultation. At the same time that draft was released the Government released consultation papers on spectrum pricing and Commonwealth held spectrum. The Australian Communications and Media Authority (ACMA), the regulator responsible for spectrum allocation and enforcement of the Act, also released a number of supporting papers related to the proposed new framework.

In a broad sense, two of the most significant changes proposed in the Bill were:

• A new licencing regime. Under the Bill, it was proposed that a single licensing system would be implemented, to replace the current arrangements involving spectrum licences, apparatus licences and class licences. This move to a single licensing system was intended to allow a greater degree of flexibility in the use of the spectrum and also potentially to allow a greater degree of spectrum sharing. (Noting class licences were intended to be replaced by a spectrum authorisation regime under which the ACMA would be able to issue legislative instruments permitting the operation of transmitters of specified kinds or for specified purposes on certain conditions.)
• A more limited role for the responsible minister. Under the current Act, the communications Minister has significant involvement in operational decisions. This reflected that, at the time the Act was first put in place, the market based regime for spectrum allocation included in the Act was still considered fairly novel and the Government wanted significant oversight of its operation. Under the proposed Bill, it was intended to adopt a different approach so that the Minister would instead set strategic priorities and make decisions that had significant public policy implications but would not be so involved in operational decisions.

Stakeholder feedback in relation to the proposed new regime was not wholly supportive. For example, there were concerns raised by broadcasters as to whether they would be disadvantaged by the proposals. So, despite various promises from the Government from time to time that a further draft of the legislation would be released in the near future, no such draft was made publicly available before the recent federal election. 

Following the election, in which the Coalition Government was returned, a new Communications Minister, Paul Fletcher, was appointed. In one of his early interviews, the new Minister stated that he would not continue with the re-write of the Act unless he believes this is actually appropriate. The Minister indicated that he intends to look at both the detriments that are said to exist with the Act and what the benefits of introducing a new regime would be. He hinted that a more limited reform of the law might be appropriate. The Minister commented that he does not have a concluded view as yet but he does think that the current system has served Australia “reasonably well”.

It may well be that the Act has served Australia reasonably well in the past, but it does need significant updating to allow the flexibility that will be required to ensure that Australia optimally allocates and uses its spectrum. A case which demonstrates this is the recent auction of 3.6 GHz spectrum, which will be used for 5G. That auction was completed by the ACMA at the end of 2018. Although the final results of the auction could be seen as successful, it should be remembered that the process commenced in 2016 and involved, over a two year period:

• two consultation papers being issued by the ACMA
• three new legislative instruments being made by the Minister for Communications
• two instruments being made by the ACMA.

The process for making spectrum available for new uses, such as 5G, should not be this difficult, complex and time consuming. It is hoped that when the new Minister for Communications does have time to consider this issue, he pushes forward with the reforms supported by his predecessor. This will not only have benefits for 5G but also benefits in other contexts where spectrum use is vital. 

Author: Angela Flannery

Contacts

Sydney
Angela Flannery, Partner 
T: +61 2 8083 0448
E: angela.flannery@holdingredlich.com

Melbourne
Dan Pearce, Partner 
T: +61 3 9321 9840
E: dan.pearce@holdingredlich.com

Brisbane
Trent Taylor, Partner
T: +61 7 3135 0668
E: trent.taylor@holdingredlich.com

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