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Telecom Order CRTC 2005-271
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Ottawa, 20 July 2005 |
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Bell Canada
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Reference: Tariff Notice 831
(National Services Tariff) |
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Customer specific arrangement
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1. |
The Commission received an application
by Bell Canada, dated 8 October 2004, requesting approval of
Tariff Notice 831 (TN 831) under National Services Tariff item 727.5,
related to services provided under Customer Specific Arrangement (CSA)
contract number P3-177. TN 831 replaced Tariff Notice 770 (TN
770), which had been filed pursuant to Regulatory safeguards with
respect to incumbent affiliates, bundling by Bell Canada and
related matters, Telecom Decision CRTC 2002-76,
12 December 2002 (Decision 2002-76). |
2. |
The CSA filed under TN 831 is a Type 2 CSA
consisting of a bundle of the following General Tariff services:
Business Primary Exchange, Centrex III, Megalink/Primary Rate Interface,
Microlink/Basic Rate Interface, Digital Exchange Access, Follow-me
Phone, Voice Grade Analog Channels, Digital Channel, Digital Network
Access, Digital Private Line, Asymmetric Digital Subscriber Line, and
Installation, Moves, Additions, Changes and Discontinuations and the
following forborne services: Audio Conferencing, Toll-Free Service
Features and Access Arrangements, Packet, Equipment Rentals, Frame
Relay, Large Capacity Digital Network, Business Internet Dedicated,
Internet Protocol Virtual Private Network Enterprise, Ethernet
Internetworking, Internet Data Centre, Virtual Private Network Secure
Access, Infrastructure, Escort, Installation, Moves, Additions, Changes
and Discontinuations, Professional, Maintenance and Management. The
minimum contract period for this CSA is seven years. |
3. |
On 8 December 2004, MTS Allstream Inc. (MTS
Allstream) filed comments with respect to Bell Canada Tariff Notices 817
to 843 and requested, among other things, that the Commission deny these
Tariff Notices. |
4. |
MTS Allstream submitted that Bell Canada's
Tariff Notices related to arrangements (or renegotiated versions
thereof) that were subject to a pending application, filed by
Allstream Corp.1 (Allstream) and Call-Net Enterprises Inc. (Call-Net) on
23 January 2004. MTS Allstream submitted that, absent a ruling on the
Part VII application that sought, among other things, denial of the
backlog of the Bell Nexxia Inc.'s (Bell Nexxia's) Type 2 CSAs, these
Tariff Notices should not be approved. |
5. |
MTS Allstream submitted that many of the
proposed rates and terms and conditions were either inconsistent with
the Commission's criteria for just and reasonable rates, or were
otherwise unjustly discriminatory or granted Bell Canada an undue
preference. |
6. |
MTS Allstream noted that Bell Canada's
appeal of Review of Bell Canada's customer-specific arrangements
filed pursuant to Telecom Decision 2002-76,
Telecom Decision CRTC 2003-63,
23 September 2003 (Decision 2003-63)
was dismissed by the Federal Court of Appeal, and the stay previously
granted by the Court was lifted. MTS Allstream submitted that, despite
those developments, the company had not disclosed the full rates and
terms and conditions of a large number of the Bell Nexxia CSAs
on the public record, contrary to the requirements of Decision 2003-63.
MTS Allstream claimed that this allowed Bell Canada to continue
to conceal the details of those arrangements until it had renegotiated
them to the company's satisfaction. |
7. |
MTS Allstream submitted that allowing
Bell Canada to renegotiate such arrangements while they were subject to
the Commission's consideration prevented a new supplier from competing
for the customer's business. |
8. |
With respect to TN 831, MTS Allstream submitted
that the services provided in TN 770 appeared to be changed in TN
831 and that some of the services were not offered under the same
MCP. MTS Allstream further submitted that service level agreements
(SLAs), credits and volume discounts appeared to have been added in
TN 831. MTS Allstream submitted, in addition, that TN 831 stipulates
that the customer would be reimbursed for changes to the terms of
the arrangement as a result of Decision 2002-76
or any CRTC order made pursuant to that Decision. MTS Allstream also
submitted that Bell Canada appeared to have relied on the imputation
test filed with TN 770 rather than filing a new imputation test for
TN 831. |
9. |
In reply on 20 December 2004, Bell Canada
stated that no services had changed and the services listed in TN 831
were consistent with the services included in the imputation test. |
10. |
With respect to MTS Allstream's comments on
varying MCPs, Bell Canada submitted that, consistent with other CSAs,
the individual services under this CSA did not have the same contract
term. Bell Canada further submitted that a customer could commit to
different contract periods for different services. |
11. |
With regard to MTS Allstream's comment
regarding the addition of SLAs, credits, and volume discounts,
Bell Canada submitted that while none of these were specified in the
original tariff, they had been provided throughout the term of the
arrangement. |
12. |
With respect to MTS Allstream's comments
regarding reimbursement for changes, Bell Canada submitted that
in the event that changes to the terms of this arrangement are made
as a result of a decision or an order made by the Commission as a
consequence of Decision 2002-76,
Bell Canada would reimburse the customer for any reasonable cost
incurred associated with implementing system changes (such as changes
to charge back systems) to the extent that such system changes are
required, and the incurred costs are solely as a result of the aforementioned
changes to the terms of this arrangement. |
13. |
With respect to the imputation test,
Bell Canada replied that a revised imputation test was filed at the
request of the Commission on 7 November 2003. |
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Commission's analysis and determinations
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14. |
The Commission notes that in Part VII
application by Allstream Corp. and Call-Net Enterprises Inc. regarding
Bell Canada Type 2 CSAs, Telecom Decision CRTC 2005-22,
7 April 2005 (Decision 2005-22),
it denied the Part VII application filed by Allstream and Call-Net
on the basis that a blanket denial of all the Bell Nexxia CSAs
would not be appropriate, and that each CSA should be considered individually
to determine whether Bell Canada had complied with the requirements
set out in Decision 2003-63.
In Decision 2005-22,
the Commission also noted that since the dismissal of its appeal of
Decision 2003-63
by the Federal Court of Appeal, Bell Canada had refiled proposed
tariff pages for the Bell Nexxia CSAs under new TN numbers, consistent
with the tariff requirements set out in Decision 2003-63. |
15. |
The Commission notes that there have been
no changes with respect to the services contemplated in this tariff
application. The Commission is satisfied that the services, rates,
terms and conditions provided are properly identified in the proposed
tariff pages and meet the requirements specified in Decision 2003-63.
The Commission is also of the view that MTS Allstream's concerns with
respect to the level of public disclosure of the rates and terms and
conditions applicable to TN 831 have been adequately addressed. |
16. |
With respect to MTS Allstream's comment
regarding varying MCPs, the Commission notes that the revenues and costs
reflected in the imputation test take into account the varying MCPs
within the bundle. Accordingly, the Commission is satisfied that the
imputation test costs accurately reflect each service's MCP, as
identified in the contract. |
17. |
With respect to MTS Allstream's comment
that SLA terms and conditions, credits, and volume discounts had been
added in TN 831, the Commission is satisfied that SLAs, credits and
volume discounts had been provided throughout the term of the
arrangement. |
18. |
With respect to MTS Allstream's comment
regarding reimbursement for changes, the Commission is satisfied with
Bell Canada's response. |
19. |
The Commission notes that Bell Canada filed
a revised imputation test on 7 November 2003. The Commission has reviewed
the revised imputation test results and is satisfied that the costing
directives specified in Decision 2003-63
have been properly applied. The Commission notes, however, that the
imputation test revenues identified by Bell Canada are less than
Bell Canada's costs. Accordingly the Commission considers that
this CSA fails the imputation test. |
20. |
The Commission further considers that the
arrangement subject to TN 831 contains provisions that confer a
preference on the customer. An example of such provisions is the
customer not being required to pay termination charges and service
charges in certain circumstances. If Bell Canada chooses, consistent
with the direction set out below, to file a new tariff, the Commission
considers that all costs associated with these preferential provisions
should be identified separately in the revised imputation test. |
21. |
In light of the above, the Commission
denies the application by Bell Canada, and directs Bell Canada
within 90 days to: |
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- file an application for a new tariff for this CSA, accompanied by
an imputation test that: (1) includes all costs associated with
preferential terms and conditions, and (2) demonstrates that the
revised arrangement passes the imputation test; or
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- advise the Commission that it has discontinued providing the
arrangement identified in TN 831.
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Secretary General |
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This document is available in alternative
format upon request, and may also be examined in PDF
format or in HTML at the following Internet site: http://www.crtc.gc.ca
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