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Telecom Letter Decision
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Ottawa, 22 October 1993
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Telecom Letter Decision CRTC 93-15
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To: Association des Hôpitaux du Québec
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British Columbia Real Estate AssociationF.& V. Energby Co-operative Inc.InfinetPagex Inc.Proshare Consulting Services Inc.Retail Council of CanadaRetail Merchants' Association of British ColumbiaStentor Resource Centre Inc.Toronto Stock ExchangeUnitel Communications Inc.Parties to Letter Decision 93-13Re:
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In Telecom Letter Decision CRTC 93-13, 19 August 1993 (Letter Decision 93-13), the Commission ruled, in response to an application from Unitel Communications Inc. (Unitel), that, at a minimum, a sharing group must be treated as a single customer for the purposes of billing, collection and liability for services rendered. The Commission stated that the telephone companies must bill a representative of the group directly for all services obtained by the group's members and, in turn, the representative of the group must be responsible for billing and collecting from its members. The Commission directed that BC TEL, Bell Canada The Island Telephone Company Limited, Maritime Telegraph and Telephone Company Limited, The New Brunswick Telephone Company Limited and Newfoundland Telephone Company Limited (the respondents) bring existing sharing groups into compliance with its ruling within 60 days. The Commission also directed that no new groups that did not conform were to be formed and that no additional members were to be added to existing groups that did not conform.
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In Letter Decision 93-13, the Commission expressed the view that Unitel's application had raised a number of significant regulatory issues related to sharing groups. Accordingly, the Commission issued Sharing Groups, Telecom Public Notice CRTC 93-51, 19 August 1993 (Public Notice 93-51), initiating a proceeding to examine issues related to the appropriate regulatory treatment of sharing groups.
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By letter dated 2 September 1993, Stentor Resource Centre Inc. (SRCI), on behalf of the respondents, requested that implementation of Letter Decision 93-13 be deferred pending the outcome of the proceeding initiated in Public Notice 93-51. The Commission also received an application dated 13 September 1993 from the Toronto Stock Exchange (TSE) containing a virtually identical request.
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Other requests for either a stay of Letter Decision 93-13 or for changes to it were subsequently received from Association des Hôpitaux du Québec, British Columbia Real Estate Association, F.& V. Energby Co-operative Inc., Infinet, Pagex Inc., Proshare Consulting Services Inc., Retail Council of Canada and Retail Merchants' Association of British Columbia.
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In support of its request, Stentor argued that the 60-day period provided is insufficient for the respondents and sharing groups to make the changes necessary to comply with Letter Decision 93-13. Stentor submitted that the sharing groups in question were structured in accordance with the rules existing at the time and that Letter Decision 93-13 changed the status quo. Stentor also submitted that the Commission did not specifically rule that the respondents' arrangements with respect to sharing groups were in breach of the Railway Act or other applicable tariffs, regulations or tariff decisions. Stentor argued that, as the rules pertaining to sharing groups may again change as a result of the proceeding initiated by Public Notice 93-51, Letter Decision 93-13 may be seen as unfair and inappropriate.
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On 10 September 1993, Unitel filed comments opposing SRCI's request. Unitel submitted that the Commission's directions in Letter Decision 93-13 were clear and that there is no overlap or confusion between those directions and the issues identified in Public Notice 93-51. In its argument, Unitel emphasized the Commission's statement that, "at a minimum", a sharing group must be treated as a single customer for purposes of billing, collection and liability for services rendered, and submitted that the issues identified in the Public Notice are clearly beyond such minimum requirements.
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By letter dated 16 September 1993, the Commission invited parties to the proceeding leading to Letter Decision 93-13 to file comments on the SRCI and TSE requests. Comments were filed by the Competitive Telecommunications Association, Call-Net Telecommunications Ltd., the British Columbia Real Estate Association and Proshare Consulting Services Inc.
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On 24 September 1993, SRCI and TSE filed replies to the comments received, essentially reiterating the positions set out in their respective applications.
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The Commission notes that the application dealt with in Letter Decision 93-13 raised a number of issues that were not addressed in that decision. It was for this reason that the Commission issued Public Notice 93-51. The direction in Letter Decision 93-13 that, at a minimum, a sharing group must be treated as a single customer for purposes of billing, collecting and liability for services rendered, was made in order to clarify, for the respondents and for existing and potential sharing groups, what constitutes a legitimate sharing arrangement under existing rules. In the Commission's view, both Letter Decision 93-13 and Public Notice 93-51 are clear that the findings in the Letter Decision are not at issue in the further proceeding. Thus, that further proceeding should not create confusion or uncertainty for the respondents or for existing sharing groups. Moreover, as noted in Letter Decision 93-13, non-compliant sharing groups could result in much greater contribution erosion than contemplated by the respondents in economic studies filed in support of the service in question and could significantly affect competitors' margins in the most contestable markets. Accordingly, the Commission does not consider it appropriate to defer implementation of Letter Decision 93-13 until a decision is issued in the proceeding initiated by Public Notice 93-51.
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With respect to the 60-day time limit, the Commission notes that, in many cases, sharing groups need time to communicate with their members and to take steps, for example, to protect confidential information about individual group members. In other cases, promotional material describing the sharing arrangements must be modified or withdrawn. Finally, in many cases, new arrangements need to be negotiated with the respondents or with third parties.
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Based on the above, the Commission is of the view that a brief extension is warranted. Accordingly, the respondents are granted an additional 30 days from the date of this Letter Decision to ensure that existing sharing groups conform to Letter Decision 93-13. As per the original ruling, in the interim, no new groups that do not conform are to be formed and no additional members are to be added to existing groups that do not conform.
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Allan J. Darling
Secretary General
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