Decree No 187 / 2019 Coll.
Decree amending Decree No. 466 / 2012 Coll., on the progress of the Czech Telecommunications Office in calculating the net cost of the obligation to provide basic services
Valid
Order
Effective from 01.08.2019
Text versions:
01.08.2019
25.07.2019
187
DECLARATION
of 23 July 2019
amending Decree No. 466 / 2012 Coll., on the Czech Telecommunications Office's progress in calculating the net cost of performing the obligation to provide basic services
The Czech Telecommunications Authority provides pursuant to Section 41 of Act No. 29 / 2000 Coll., on Postal Services and on the amendment of certain laws (Act on Postal Services), as amended by Act No. 221 / 2012 Coll., Act No. 212 / 2013 Coll. and Act No. 319 / 2015 Coll., to implement Section 34b (7) of the Act on Postal Services:
Decree No. 466 / 2012 Coll., on the progress of the Czech Telecommunications Office in calculating the net cost of the obligation to provide basic services, is amended as follows:
1. In Article 2, the words "expressed in the form of capital costs' are inserted after the words" profit '.
2. Paragraph 3 (2) reads as follows:
"(2) The incremental costs shall be calculated according to the following formula:
PN = NZS - NAS
where:
PN - incremental costs,
NZS - the cost of providing the services of the postal licence holder in the base case referred to in § 7 (2),
NAS - costs of the postal licence holder in the alternative scenario referred to in Article 7 (3). '
3. The following Sections 3a to 3c are inserted after Section 3:
(1) The cost of the capital of the holder of a postal licence for the provision of services contained in his postal licence pursuant to Article 7 (2) shall be calculated according to the following formula:
NKZS = WACCZS * VKZS,
where:
NKZS - cost of capital of the postal licence holder in the base case according to § 7 (2),
WACCZS - percentage of return on capital employed before tax in the base case under Paragraph 7 (2),
VKZS - capital injected in the base case under Paragraph 7 (2).
(2) The cost of the capital of the postal licence holder for the provision of services contained in the alternative scenario referred to in Article 7 (3) shall be calculated according to the following formula:
NKAS = WACCAS * VKAS
where:
NKAS - cost of capital of the postal licence holder in the alternative scenario referred to in § 7 (3),
WACCAS - percentage of pre-tax return on capital employed in the alternative scenario under Paragraph 7 (3),
VKAS - injected capital in an alternative scenario pursuant to § 7 (3).
(1) The percentage of return on capital employed before tax in both the base and the alternative scenarios is expressed by means of the weighted average cost of capital (WACC) before tax and is calculated according to the following formulae:
WACCBT = WACCAT / (1 - t),
where:
WACCBT - weighted average cost of capital before tax,
WACCAT - weighted average post-tax capital costs,
t - the corporate tax rate expressed as a decimal.
WACCAT = re * ED + E + rd * 1- t * DD + E,
where:
re - cost of equity,
rd - costs of foreign capital,
E - the value of the company's equity,
D - the value of the company's foreign capital.
(2) The pre-tax rate of return on capital employed for the base case (WACCZS) is expressed as a percentage of the return on capital employed by the postal licence holder in the Czech Republic.
(3) The pre-tax return on the transferred capital for the alternative scenario (WACCAS) is expressed as a percentage of the return on the transferred capital of the postal service provider without the imposition of the obligation to provide basic services.
(4) The Czech Telecommunications Office shall determine the percentage of return on capital injected in accordance with paragraphs 2 and 3 and this value shall be valid for the period of validity of the postal licence. The value of the WACC shall be determined when verifying the application for net costs during the first period of validity of the licence.
(1) Embedded base-case capital (VKZS) means the value of the long-term assets and working capital of the postal licence holder necessary to provide postal services to the extent defined in the base-case scenario in accordance with Article 7 (2).
(2) Embedded capital in the alternative scenario (VKAS) means the value of the long-term assets and working capital of the postal licence holder necessary to provide postal services to the extent defined in the alternative scenario under Article 7 (3).
(3) Unless otherwise stated, the holder of the postal licence shall report the value of the capital contributed in accordance with the Czech Accounting Standards under the accounting legislation.
(4) The value of long-term assets shall be taken into account in accordance with International Accounting Standards. ';
4. Paragraph 4 (2) reads as follows:
"(2) The incremental revenue shall be calculated according to the following formula:
PV = VZS - VAS,
where:
PV - incremental income,
VIS - the proceeds of the postal licence holder from the provision of services in the base case provided for in Article 7 (2),
PRS - proceeds of the postal licence holder in the alternative scenario referred to in Article 7 (3). '
5. in Article 5 (1) (a), the words "to the elements of the network and activity" shall be inserted after the words "costs."
6. In Article 5 (1) (c), "k 'is replaced by" k';
7. In Article 5 (1), the words "expressed in the form of capital costs' shall be added at the end of the text in point (d).
8. in Article 5 (1), point (e) is deleted;
9. Paragraph 5 (2) reads as follows:
"(2) The net costs shall be calculated according to the following formula:
CN = [PN + ΔNK] - [PV + ΣTv]
where:
CN - net cost,
PN - incremental costs,
PV - incremental income,
ΔNK - difference between NKZS and NKAS pursuant to § 3a,
Tv - intangible and market advantages resulting from the imposition of an obligation to provide basic services, expressed in cash, by the postal licence holder. '
10. At the end of the text of Section 6, the words "in such a way as to meet the basic qualitative requirements defined in the postal licence 'are added.
11. in Article 7 (2), the words "for the provision of essential services contained in the postal licence of the holder of the postal licence" and the words "obtained by the provision of such services" shall be deleted;
12. in Article 8 (2), the words "and to ensure the performance of other services in the public interest resulting from contracts concluded or its main activity, irrespective of the postal licence, shall be added at the end of the text in point (a)."
13. in Article 8 (2) (e), the words "or other place of service of customers" shall be inserted after the word "establishment" and the words "or other place of service of customers" shall be added at the end of the text.
14. In Article 8, at the end of paragraph 2, the dot is replaced by a comma and the following point (g) is added:
"(g) for buildings which the holder of a postal licence has long-term lease and will not have an establishment in the alternative scenario, the contractual fines and penalties for early termination of the lease contract shall be taken into account in order to avoid double counting and to be based on the nature of the penalty agreed.";
15. in Paragraph 8 (3) (a), the words "and will not lose their market position" shall be inserted after the word "customers."
16. in Article 8 (3) (c), the word "only" shall be deleted and at the end of the text the words "and the corresponding share of corporate direction" shall be added;
17. in Paragraph 8 (4), the words "When drawing up this alternative scenario, it is based on these assumptions" shall be replaced by the words "Taking into account."
18. in Paragraph 8 (4) (a), the words "costs must contain only costs resulting from the obligation to provide basic services, i.e." shall be deleted.
19. in Paragraph 8 (4) (b), the words "other costs may not be included" shall be replaced by the words "change in revenue, where the activity for which an alternative scenario is drawn up gives rise to the holder of a postal licence."
20. In Paragraph 11 (2), the word "individual 'is deleted and the word" service' is replaced by "services'.
21. in Article 12 (1), the words "the results of separate cost and revenue records" shall be inserted after the words "the plan."
22. the Annex reads as follows:
"Annex to Decree No 466 / 2012 Coll.
Documents to calculate net costs
Table 1: Total value of net costs of the postal licence holder (CZK)
Table 2: Quantification of the total value of intangible and market benefits (CZK)
Table 3: Records of data needed to quantify the net cost of the change in the network of establishments (to implement § 8 (2)) - Part 1 - Part 2 - Part 3
Table 4: Loss of revenue on closed premises (to implement § 8 (2) (c) to (e))
Table 5: Records of the data needed to quantify the net cost of the change in delivery (to implement Section 8 (3))
Table 6: Capital costs (in CZK)
"
Efficacy
This Decision shall enter into force on 1 August 2019.
Council President:
Ing. Mgr. Novák v. r.
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Regulation Information
| Citation | Decree No. 187 / 2019 Coll., amending Decree No. 466 / 2012 Coll., on the progress of the Czech Telecommunications Office in calculating the net costs of the obligation to provide basic services |
|---|---|
| Regulation Type | Order |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 25.07.2019 |
|---|---|
| Effective from | 01.08.2019 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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