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Order CRTC 2001-689
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Ottawa, 31 August 2001
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The Commission refrains from regulating Teleglobe's remaining
tariffed services
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Reference: 8640-T2-02/01 |
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With this order, the Commission refrains from regulating
Teleglobe's remaining tariffed services. However, the Commission
will retain sufficient powers to protect the confidentiality of
customer information and to impose conditions on the delivery of
Teleglobe's services as may be warranted in the future.
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Teleglobe's application
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1. |
On 4 April 2001, pursuant to the Telecommunications Act (the Act)
and Part VII of the CRTC Telecommunications Rules of Procedure,
Teleglobe Canada Limited Partnership (Teleglobe) applied for
forbearance from regulation of Teleglobe's remaining tariffed
services and any similar services it may offer in the future.
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2. |
Teleglobe requested complete and unconditional forbearance from
sections 24, 25, 27, 29 and 31 of the Act.
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3. |
Teleglobe also requested discontinuance of all ancillary forms of
regulation applicable to the company pursuant to Telecom Decision
CRTC 96-2, Teleglobe - Review of the regulatory framework,
dated 2 February 1996, as amended. These consist of the requirements
to file:
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· quarterly Telephone Services reports
on year-to-date outward revenues, outward traffic and outward
revenue per minute for regulated services; |
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· quarterly summary of year-to-date
financial actuals; and |
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· annual reports on research and
development expenditures. |
4. |
Teleglobe stated that it sent copies of its application to its
competitors and customers. There were no interventions opposing the
application. TELUS Communications Inc. wrote to support the
application.
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5. |
With the application, Teleglobe submitted a detailed market
analysis of each of the company's remaining tariffed services in
accordance with Telecom Decision CRTC 94-19, Review of regulatory
framework, dated 16 September 1994. In this analysis, Teleglobe:
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· argued that its customers, which are
other carriers and large businesses, are sophisticated and
knowledgeable, that each can find alternatives to Teleglobe's
services, and that many also have the option to self-supply; |
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· identified specific alternative
suppliers based in Canada and the United States for each such
service; |
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· provided evidence that there is
adequate satellite and cable capacity available from alternate
suppliers, and that there are no barriers preventing customers from
switching suppliers; |
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· submitted evidence on the rapid growth
of international submarine cable capacity, and argued that Canadian
transmission requirements could easily be accommodated by current
market conditions; |
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· argued that there are no entry
barriers and that, since Telecom Decision CRTC 98-17, Regulatory
regime for the provision of international telecommunications
services, dated 1 October 1998, American and other foreign-based
service providers may offer international telecommunications
services originating or terminating in Canada; and |
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· submitted that, as a minority owner of
several submarine cable systems, it is unable to control
availability and pricing. |
6. |
Teleglobe argued that in view of the availability of
international facilities and service providers, it would not be
necessary to limit forbearance to specific routes.
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Analysis of the application
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7. |
Based on the market analysis submitted by Teleglobe, and also on
the fact that none of Teleglobe's customers, and no competing
carrier, contested the company's evidence, the Commission finds that
in the markets for Teleglobe's remaining tariffed services, there is
sufficient competition to protect user interests. Therefore, the
Commission is of the view that it is appropriate to forbear from
regulation of these services pursuant to section 34(2) of the Act.
Further, based on the market analysis submitted by Teleglobe, the
Commission also finds that forbearance from regulation would not
endanger the continuance of a competitive market for international
telecommunications services originating or terminating in Canada, in
accordance with section 34(3) of the Act.
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Scope of forbearance
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8. |
When forbearing from regulation, the Commission frequently finds
it appropriate to retain some of its powers under section 24 of the
Act to ensure that the confidentiality of customer information is
protected, and to be able to impose conditions on service delivery
that may be warranted in the future.
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9. |
Teleglobe requested that the Commission forbear from section 24
of the Act in its entirety, arguing that user interests are
protected without Commission imposed conditions, and that the
confidentiality of customer information is already protected by the
new privacy legislation, the Personal Information Protection and
Electronic Documents Act.
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10. |
However, the Commission has decided to retain sufficient powers
under section 24 of the Act to ensure the continued application of
existing conditions for confidentiality of customer information and
continued protection of customer confidentiality in all future
contracts and other arrangements for services which are forborne
from pursuant to this application. Further, the Commission notes
that Teleglobe is currently subject to a number of clear
restrictions on its ability to disclose such information pursuant to
section 15 of its Terms of Service. For example, the Terms require
written customer consent to disclosure except in a limited number of
situations that are clearly set out. It is not evident that the new
privacy legislation would provide comparable protection to
Teleglobe's customers.
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11. |
Moreover, the company's plans for retail market entry are not
known. In Telecom Decision CRTC 99-14, Teleglobe Canada Inc. -
Forbearance for GlobeaccessTel and related matters, dated
28 September 1999, the Commission determined that Teleglobe
should establish a Carrier Services Group (CSG) prior to entering
the retail market. The Commission will retain sufficient powers
under section 24 of the Act to ensure this and to be able to impose
conditions on the delivery of Teleglobe's remaining tariffed
services as may be warranted.
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12. |
The Commission also considers it necessary to retain part of its
powers under section 27(3) of the Act to ensure compliance with
powers and duties not forborne in this order. |
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Reporting requirements
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13. |
The Commission finds that with forbearance from rate regulation,
several of Teleglobe's reporting requirements are no longer
necessary, or can be simplified. Effective with the quarter
following this order, the company will no longer be required to file
the quarterly Telephone Services reports on year-to-date outward
revenues, outward traffic and outward revenue per minute; the
quarterly financial reports; and the annual reports on research and
development expenditures. However, Teleglobe will be required,
pursuant to section 24 of the Act, to file annual financial reports
with the Commission.
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14. |
Pursuant to section 34(1) of the Act, the Commission finds, as a
question of fact, that to refrain from exercising its powers and
duties under sections 24 (in part), 25, 29 and 31, and sections
27(1), 27(2), 27(3) (in part), 27(4), 27(5) and 27(6) of the Act to
the extent set out in this order with respect to Teleglobe's
remaining tariffed services would be consistent with the Canadian
telecommunications policy objectives.
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15. |
Pursuant to section 34(2) of the Act, the Commission finds as a
question of fact that the provision of these services is
sufficiently competitive to protect the interests of users.
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16. |
Pursuant to section 34(3) of the Act, the Commission finds that
to refrain from exercising the powers and performing the duties to
the extent set out in this order would not likely impair the
continuance of a competitive market for these services.
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The Commission grants forbearance
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17. |
The Commission therefore orders that: |
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a) pursuant to section 34(4) of the Act,
effective immediately, sections 24 (in part), 25, 29 and 31, as well
as sections 27(1), 27(2), 27(3) (in part), 27(4), 27(5) and 27(6) of
the Act do not apply, to the extent that they are inconsistent with
the determinations in this order regarding Teleglobe's remaining
tariffed services; and |
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b) Teleglobe withdraw its tariff pages
forthwith. |
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Secretary General
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This document is available in alternative format upon request and
may also be examined at the following Internet site: http://www.crtc.gc.ca
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