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The Australian Competition and Consumer Commission (ACCC) has rejected NBN Co’s proposed variations to its Special Access Undertaking (SAU), knocking back the proposed set of rules to which broadband providers will need to adhere to access the NBN in coming years.

The ACCC said it was not convinced the updated SAU would promote the long-term interests of consumers and that the proposal would require revenue allowances from July 2032 that would not incentivise NBN Co to act efficiently. 

“The ACCC can only decide to accept or reject NBN Co’s variation proposal, and our draft decision today is to reject this proposal,” ACCC Commissioner Anna Brakey said.

Furthermore, the consumer watchdog said NBN Co’s proposed access terms for the first three years would pose risks to efficiency and competition because the cost of services supplied using the standard wholesale offer would “fall over a very wide range”.

The ACCC said the variated SAU could not provide NBN Co with suitable enough measures to assist retailers with this residual cost uncertainty.

The SAU is an important part of the economic regulation of the NBN, responsible for setting rules for broadband providers to have access over the coming decades and including minimum service standards with control of wholesale NBN prices

The ACCC’s rejection marks two years of ongoing consultation with NBN to update the current SAU, which was established in 2013.

“Australia needs an efficient, reliable and affordable national broadband network to be a world-leading digital economy,” Ms Brakey said.

“We are acutely aware that the process to vary the current NBN Special Access Undertaking has been running for two years and we appreciate the open and ongoing engagement by the sector through that time.

“This is critical, national infrastructure and to accept a variation we must be satisfied it promotes the long-term interests of Australians.”

Alongside its draft decision, the ACCC published a letter it received in March from NBN Co outlining several changes it would be willing to make in a new proposal to respond to the concerns raised.

In any case, the ACCC said NBN Co’s latest proposed SAU variations were a step closer to the improvements needed for future proposals.

“In making our decision, we have identified a number of aspects that reflect issues raised in the ongoing industry consultation process and that represent a significant improvement on the current SAU and earlier variation proposals,” Ms Brakey said.

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