After a close-fought battle, the Australian Senate has passed legislation to split Telstra and clear the way for the government's NBN project.
The bill will cleared by a margin of 30-28. It will now be sent back to the lower house, where it is expected to be passed on Monday.
The legislation was passed with the support of independent senators - including a last-minute deal with Nick Xenophon on Wednesday.
The legislation paves the way for the government to separate Telstra's retail wing from the rest of the company, and use its copper ducts and infrastructure. In exchange the state-owned NBN Co. will pay the operator A$14 billion ($13.7b) over 30 years.
Telstra's co-operation in the project is expected to reduce the cost of the project by up to A$7 billion.
Opposition attempts to amend the bill to force Labor to submit to a cost-benefit analysis of the project were voted down.
But it has been modified with tighter controls on the planned eventual sale of the NBN operating company. The minority Greens party had made these a condition of lending its backing to the vote.
The government and Telstra are now more likely to meet their self-imposed deadline of finalizing a proposal on separation that Telstra can take to shareholders by the middle of 2011.