News Release

March 30, 2001

CRTC GIVES FINAL APPROVAL TO MTS COMMUNICATIONS INC. TELEPHONE RATE INCREASES

OTTAWA-HULL — Today, the Canadian Radio-television and Telecommunications Commission (CRTC) gives final approval to the residential and other telephone rate increases required by MTS Communications Inc. (MTS) to recover its income tax expense for the years 2000 and 2001.

On 1 August 2000 the Commission approved on an interim basis, increases to local residential and other telephone services rates. To determine the exact amount required by MTS for the recovery of its income tax expense, the Commission, among other things, held a public process in Winnipeg, in January 2001. During the consultation and public hearing, subscribers, MTS and other interested parties were given the opportunity to submit their comments on this issue.

MTS became a taxable corporation during the year 2000. The CRTC finds that the additional revenues required by the company to recover its income tax expense for regulatory purposes to be $20.2 million in 2000 and $39.1 million in 2001 rather than the $38.0 million and $75.2 million suggested by MTS.

The CRTC notes that in general, local business and optional services are priced above cost and already include an implicit amount of income tax expense that, prior to MTS becoming taxable, subsidized local residential services. As such the CRTC finds that it is reasonable that a larger portion of the amount required to recover MTS' income tax expense come from increases to local residential service rates.

To allow MTS to recover its income tax expense, the CRTC makes the 1 August 2000 interim rates final and approves a local residential rate increase of $1.85, as well as various increases to other service rates, effective 1 April 2001.

Reference documents:  Decision CRTC 2001-202,
                                  Public Notice CRTC 2000-108 and
                                  Order CRTC 2000-677

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General Inquiries:
   Ottawa, Ontario K1A 0N2
   Tel: (819) 997-0313, TDD: (819) 994-0423, Fax: (819) 994-0218
   Toll-free # 1-877-249-CRTC (2782), eMail: info@crtc.gc.ca 
   TDD - Toll-free # 1-877-909-2782
Media Relations:
   Denis Carmel, Tel: (819) 997-9403, eMail: denis.carmel@crtc.gc.ca 

Copies of today’s documents are available through our Internet site ( http://www.crtc.gc.ca ) or by contacting the public examination room of any CRTC office. These documents are available in alternative format upon request.

Date Modified: 2001-03-30

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