Commerce Commission releases final IM decision

Chorus Limited
Level 10, 1 Willis Street
P O Box 632
Wellington
New Zealand

Email: company.secretary@chorus.co.nz

STOCK EXCHANGE ANNOUNCEMENT

3 November 2020
Commerce Commission releases final IM decisions reasons paper and
final determination for the financial loss asset
The Commerce Commission has released its final IM decisions reasons paper and
final determination of the financial loss asset provisions.

These decisions establish the rules that will apply to establish Chorus’ financial
losses from 2011 – 2021. They are the second tranche of IM decisions, the first
of which was released on 13 October 2020. Both tranches establish the rules for
price quality and information disclosure regulation that will apply to Chorus from
1 January 2022.

While today’s decision on WACC and CIP financing reflect very slight
improvements in the post implementation decision of 13 October, overall the
Commission’s decisions simply do not reflect commercial reality and the true
level of cost or risk that was faced in building the UFB network.

The final views today, and range of changed views from the Commission during
this process, send extremely poor signals to investors in New Zealand’s
infrastructure and future public private partnerships. They signal that real
commercial risk may be assumed away with hindsight.

We will continue to review the decisions to date in totality and work with the
Commission through the price quality process to encourage outcomes that will
support incentives to continue to invest and innovate for the benefit New Zealand
consumers.
Authorised by:

David Collins
Chief Financial Officer

ENDS

For further information:

Steve Pettigrew
Head of External Communications
Mobile +64 (27) 258 6257
Email: Steve.Pettigrew@chorus.co.nz

Brett Jackson
Investor Relations Manager
Phone: +64 4 896 4039
Mobile: +64 (27) 488 7808
Email: Brett.Jackson@chorus.co.nz