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Order CRTC 2000-397
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Ottawa, 12 May 2000
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Altering terms of service for
competitors that are customers Reference: 8622-C12-03/97 |
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In this order the Commission is taking
several steps to ensure equitable treatment of competitors that are customers of the
telephone companies. These include changes to the terms of service, to remove the
limitation on the companies' liability in cases of anti-competitive behaviour, and to
specify that generally 30 days notice is required before a competitor's service can
be disconnected. In addition, the telephone companies will be required to report to the
Commission all significant interruptions in service to competitors.
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1.
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Many of the provisions of the Canadian
telephone companies' present terms of service date back to Review of the general
regulations of the federally regulated terrestrial telecommunications common carriers,
Telecom Decision CRTC 86-7, dated
26 March 1986. While Decision 86-7 applied only to
Bell Canada, British Columbia Telephone Company, Northwestel Inc. and Terra Nova
Telecommunications Inc., other telephone companies adopted similar terms of service as
they became subject to regulation by the Commission.
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2.
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At the time of Decision 86-7, there was only
limited competition for services provided by the telephone companies, and the terms of
service were not specifically designed to address issues that could arise when a telephone
company provides services to a customer that uses the services to compete with the
telephone company.
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3.
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Following disputes between Call-Net
Entreprises Inc. and fONOROLA Inc. and Bell Canada, and an application by Unitel
Communications Inc. (now AT&T Canada Corp.) requesting that the telephone companies be
required to report all service outages of more than 15 minutes duration, the Commission
issued Review of the terms of service and general regulations of the telephone
companies with respect to services and facilities provided to competitive providers of
telecommunications services, Telecom Public Notice CRTC 97-40, dated 1 December
1997. In this public notice the Commission requested comment on whether, and if so, how,
the terms of service should be changed for customers who are also competitors of the
telephone companies.
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4.
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PN 97-40 also stated that the
Commission intended to dispose of AT&T Canada's application in this proceeding.
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5.
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The Commission received comments or reply
comments from Association des compagnies de téléphone du Québec inc., AT&T Canada,
AT&T Canada Enterprises Inc., Call-Net, Clearnet Communications Inc., fONOROLA, London
Telecom Network Inc., MetroNet Communications Group Inc., Microcell Telecommunications
Inc., Westel Telecommunications Ltd., Canadian Bankers Association; Northwestel, and from
Stentor Resource Centre Inc., on behalf of Bell Canada, BC TEL, (now TELUS Communications
(B.C.) Inc.) (TCBC), TELUS Communications Inc. (TCI) and TELUS Communications (Edmonton)
Inc. (TCEI), Island Telecom Inc., Maritime Tel & Tel Limited (MTT), MTS Communications
Inc., NewTel Communications Inc. and NBTel Inc.
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6.
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This order applies to Bell Canada, TCBC,
Island Tel, MTT, MTS, NewTel, TCI, TCEI, NBTel, Northwestel, Québec-Téléphone and
Télébec ltée and the other independent telephone companies in Quebec and Ontario,
except Ontario Northland Transportation Commission, Abitibi-Price Inc., Cochrane Public
Utilities Commission, and Prince Rupert City Telephones.
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Liabilities of the telephone companies
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7.
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Many competitors that participated in this
proceeding expressed the view that with the limitations of liability in the telephone
companies' present terms of service, they cannot seek financial redress for direct and
consequential damages that they experience as a result of negligent acts or omissions by
the telephone companies. Competitors also argued that the present terms of service provide
few disincentives for the telephone companies to act anti-competitively.
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8.
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The Commission considers that there is no
excuse for anti-competitive behaviour, whether with regard to service quality, refusal to
provide service, or other matters. Anti-competitive conduct increases costs and risks to
competitors, and thus slows the development of competition. The Commission considers that
to ensure the continuing development of competition in telecommunications markets,
competitors should be able to seek redress through the courts for losses they experience
as a result of anti-competitive conduct by a telephone company.
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9.
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To make it possible for competitors to recover
such losses, the Commission directs the telephone companies to change their terms of
service so that the telephone companies' liability is not limited in cases of
anti-competitive conduct. Further, their liability will continue to be unlimited in those
circumstances currently covered in the terms of service, including physical injury, death
or damage to customer premises or other property occasioned by telephone company
negligence, and cases of deliberate fault, gross negligence or breach of contract where
the breach of contract is the result of gross negligence.
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Suspension or termination of
a competitor's service |
10.
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Several competitors that participated in this
proceeding submitted that with the telephone companies' present terms of service, service
may be suspended or terminated if there is an unpaid balance of as little as $50.
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11.
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Pursuant to the telephone companies' current
terms of service (in most cases Article 22), the telephone company may suspend or
terminate a customer's service once the customer's account is past due if the amount owed
is greater than $50. However, before the service can be disconnected, the telephone
company must provide the customer with reasonable advance notice, and, at least 24 hours
prior to disconnection, must advise the customer that disconnection is imminent. The
present terms of service do not define what constitutes reasonable advance notice. The
present time limit provisions (usually Article 17) in the terms permit the telephone
company to request more rapid payment in exceptional circumstances or extreme situations.
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12.
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The Commission considers that service to a
customer who is a competitor of a telephone company should generally not be suspended or
terminated unless the customer has 30 days notice to pay past due amounts. Accordingly,
for the purposes of the termination and suspension provisions in the terms (Article 22.3
in most cases), the Commission considers that reasonable advance notice for the
termination or suspension of a customer that is a competitor of the telephone company
should generally be at least 30 days, and that the terms of service should be amended
accordingly. However, this determination does not affect the provisions which permit the
telephone company to abridge the date by which an account may be considered past due, and
reduce the amount of notice required (for example, Articles 17.2 and 17.4 of Bell Canada's
terms).
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Reporting of service outages to the
Commission
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13.
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AT&T Canada requested that the telephone
companies be required to report to the Commission all service outages that exceed 15
minutes in duration and affect service to one or more competitors.
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14.
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During the proceeding, a number of competitors
submitted that the telephone companies may have incentives to provide their competitors
with service subject to interruption, since service interruptions may create perceptions
on the part of competitors' customers that competitors provide low quality service.
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15.
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The Commission considers that, depending on
the circumstances, an interruption in service to competitors, or a lack of timely
restoration, may indicate anti-competitive conduct by a telephone company.
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16. |
Accordingly, in order to be able to ascertain
whether this is the case, the Commission considers that the telephone companies should
report all service outages that affect competitors and that exceed 15 minutes in duration.
To enable the Commission to determine whether an outage could indicate anti-competitive
conduct, the report should contain the following information for each reportable outage:
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a) the duration and reason for the outage;
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b) the extent to which service to the
telephone company's other customers was affected;
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c) the time at which service was restored to
the competitor; and
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d) the time at which service was restored to
the telephone company's other customers.
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Other issues raised in the proceeding |
17.
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Several other issues were raised by interested
parties in this proceeding. However, after reviewing the submissions, the Commission
considers that no changes to the telephone companies' terms of service, other than those
already identified, are required at this time.
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18.
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Some of the issues raised by competitors are
as follows.
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Telephone company initiated changes in
telephone numbers |
19.
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A number of competitors noted that pursuant to
the terms of service, customers have no proprietary rights to their telephone numbers.
They submitted that frequent changes in telephone numbers may make it more difficult for
competitors to compete with the telephone companies.
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20.
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Changes in telephone numbers are not an issue
for competitive local exchange carriers (CLECs), since CLECs obtain their numbers directly
from the numbering administrator. The Commission notes that frequent changes in telephone
numbers could create some difficulties for other competitors, such as resellers with
line-side access.
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21.
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However, the telephone companies' present
terms of service permit the telephone companies to change customers' telephone numbers
only if there are reasonable grounds for doing so, and only after customers have received
reasonable advance notice of the number change. Further, the Commission has no evidence
that the telephone companies have abused their authority to change telephone numbers.
Accordingly, the Commission considers that no change is required to the terms of service
relating to changes in telephone numbers.
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Payment time limits
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22.
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Some competitors submitted that they do not
receive bills from the telephone companies in a convenient format. They complained that
bills are often received only a few days before the payment due date and that they do not
have sufficient time to examine them.
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23.
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The Commission considers that to the extent
that these problems remain, they can and should be resolved between the parties. The
Commission notes that the telephone companies and other service providers could utilize
the CRTC Industry Steering Committee (CISC) to negotiate matters relating to billing
format and payment times.
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Obligation to provide service |
24.
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The telephone companies' terms of service
state that a telephone company is not obligated to provide service if it would incur
unusual expenses that an applicant for service is unwilling to pay.
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25.
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Fonorola and Westel submitted that the
telephone companies should be obligated to provide service if the competitor provides a
demand forecast.
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26.
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The Commission considers that the telephone
companies would assume some of the business risks of their competitors if they were
required to provide service when a competitor has simply forecast a demand. The Commission
considers that competitors should assume this risk, and pay the amounts required to obtain
service from the telephone company. Accordingly, the Commission concludes that no change
to the companies' terms of service is required relative to provision of service involving
unusual expenses.
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Quality of service to competitors
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27.
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Several competitors submitted that the terms
of service should specify quality of service standards, and that competitors should have
the right to discontinue services of below standard quality and switch without incurring
additional costs to the service with the next higher grade of quality.
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28.
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In Final standards for quality of service
indicators for use in telephone company regulation and other related matters, Decision
CRTC 2000-24, dated 20 January 2000, as amended by Decision CRTC 2000-24-1, dated
15 February 2000, the Commission directed the telephone companies to propose a
methodology for reporting compliance with the quality of service standards which were
negotiated in the CISC and approved by the Commission.
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29.
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Considering the requirements of Decision
2000-24, and in light of the changes made to the telephone companies' terms of service in
this order, the Commission concludes that the telephone companies' terms of service need
not specify quality of service standards.
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Alternate dispute resolution
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30.
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Several competitors stated that the telephone
companies' terms of service should refer to the alternate dispute resolution (ADR)
process, so that parties could avoid the often lengthy and costly delays that occur when
filing applications under Part VI or Part VII of the CRTC Telecommunications Rules of
Procedure.
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31.
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The Commission considers that the ADR process
is available to all parties, and has been used successfully on many occasions by
interested parties and the Commission. While the Commission encourages parties to utilize
the ADR process, it does not consider it necessary that the terms of service refer to it.
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Direction to change the terms of
service and report service outages |
32.
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The telephone companies are directed, within
two weeks of the date of this order, to issue revised tariff pages so that the relevant
articles in their terms of service state:
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"These terms do not limit (company
name)'s liability in cases of deliberate fault, gross negligence, anti-competitive
conduct, or breach of contract where the breach results from the gross negligence of
(company name)"; and
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"For the purposes of Article X [insert
number of provision equivalent to Article 22.3 of Bell Canada's terms of service],
reasonable advance notice for the termination or suspension of the service of a customer
that is a competitor will generally be at least 30 days."
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33.
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The telephone companies are directed to
report, effective immediately, on a going forward basis, all service outages exceeding 15
minutes in duration that affect service to competitor(s).
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34.
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They are directed to report the following
information for each outage:
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- the time and location of the outage
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- the competitor(s) affected by the outage
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- the duration and reason for the outage;
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- the extent to which the outage affected service to the telephone
company's other customers;
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- the time at which service was restored to the competitor(s) affected by
the outage; and
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- the time at which service was restored to the telephone company's other
customers.
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Secretary General
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This document is available in alternate
format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca
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