TELECOMMUNICATIONS BILL

Debate resumed.

Mr Yeo Cheow Tong: Sir, his last point was on the WTO negotiations and discussions and if those negotiations do impact on the existing licensees, we should hold consultation with the licensees. Sir, indeed this has been the practice and we will continue with it.

Mr Chay Wai Chuen: Mr Speaker, Sir, I would like to just clarify one point which the Minister touched on just now. In talking about the issue of interconnection access and the free rider problem, I said just now that we might end up giving up a lot but getting very little. What I meant was actually when people, particularly international companies, come into Singapore and operating as licensees, riding on the interconnection access which is built up internally here, there is an issue here. How does one price it? Of course, you can say that by opening up the market, naturally prices are becoming cheaper and cheaper. But if you just look at this kind of benchmark, international prices of operator, it might not mean a thing. The value of the business is resided in the asset value of the company. So the value is actually there - in the control of the operations, in the headquarter company, in the stockholding company which is overseas. So the danger is really there. If you just use the normal standard day-to-day routine measure and say, "Bottomline. That's it. So many cents per call, or whatever." I hope the Minister can dwell into what I mean when I said "giving up a lot for very little".

Assoc. Prof. Toh See Kiat: Sir, I wish to ask the Minister to clarify. Does he not see the anomaly that arises when he says that clause 41 is not intended to cover electronic snooping? If you get a person who taps into a telephone line, that is illegal but if he taps into an aired message through a mobile phone system, then it is not illegal. I do agree that there are encryption systems. But as a matter of practice, most mobile phone messages will remain unencrypted for a long term and also perhaps because it is more expensive. And it does indeed say much of our move into the IT age that we do have laws preventing private communications from unwittingly becoming non-private.

Mr Simon Tay: I would like to thank the Minister for his clarifications. I would seek further clarification on only one point. It is regarding the release of decisions to the public. I agree with the Minister that where it is commercially sensitive, it should be withheld. But can I take it that the Minister is reassuring us that where it is not commercially sensitive and where there are principles that apply to other companies or the public, these will be released because there have been controversies before.

Mr Yeo Cheow Tong: Mr Chay sought to clarify what he is talking about. Sir, I do take his point. This is why TAS has put in place a charging framework for interconnection which should be applicable for only three years. This charging framework establishes, among other things, an economic cost model for calculating the interconnect charges and infrastructure sharing. This cost model is based on the current replacement cost principles to ensure that the infrastructure owner is fairly compensated for interconnection and for the use of his infrastructure. This framework is generally an attempt to redress the asymmetry in the bargaining position of the new entrant, vis-a-vis the incumbent, and it gives the right signals and incentives to both the new and old players. The new operator can decide whether to buy or to build his own facilities while the incumbent operator has the incentive to continue to invest in the infrastructure because it is getting a good economic return on whatever he is investing. After three years, the operators will then proceed to commercially re-negotiate the prices. And it is only when they cannot agree on the pricing, will IDA then intervene again. What we would like to do is to leave it to them to establish their own pricing mechanism. If there are enough players, the new entrants will have enough choices to negotiate with.

Prof. Toh mentioned about clause 41 again. Sir, the intent, as I said, is to prevent damage to the existing facilities, including line installation, and all that. If someone is snooping and is using our line systems, then we can take action against him. But, as I said, the one which we are unable to cover against, at the moment, is snooping into the wireless media, and the most common one will be the handphone conversation. As I said, at the present moment, encryption is already strong for the GSM and CDMA and I think the future generation of handphones will have even stronger encryption capabilities. If there is a need for us to guard against that in the future, we will be very happy to enact the required legislation. But at the present moment, there is no evidence that this is needed.

Regarding Mr Simon Tay's question, yes, where the decisions and the facts of the case are not commercially sensitive, there is no reason why we should not divulge them. But our experience so far has been that many of the cases do involve sensitive information. As we have seen in the recent complaints in the newspapers and our replies, they do involve highly commercially sensitive information.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Mr Yeo Cheow Tong].

Bill considered in Committee.

[Mr Speaker in the Chair]

Clause 1 ordered to stand part of the Bill.

Clause 2 -

Mr Yeo Cheow Tong: Sir, I beg to move,

In page 4, line 27, at end to add "but excludes any broadcasting service".

Sir, this is to make the definition of "telecommunication service" consistent with its definition in the IDA Act.

Amendment agreed to.

Clause 2, as amended, ordered to stand part of the Bill.

Clauses 3 to 9 inclusive ordered to stand part of the Bill.

Clause 10 -

Mr Yeo Cheow Tong: Sir, I beg to move,

In page 11, line 14, to leave out "53", and insert "58".

Sir, there is a typographical error in page 11, line 14. The number "53" should read "58" instead.

Amendment agreed to.

Clause 10, as amended, ordered to stand part of the Bill.

Clauses 11 to 76 inclusive ordered to stand part of the Bill.

Bill reported with amendments; read a Third time and passed.