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ARCHIVED -  Telecom Order CRTC 96-65

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Telecom Order

Ottawa, 23 January 1996
Telecom Order CRTC 96-65
IN THE MATTER OF an application by Sprint Canada Inc. (Sprint) dated 19 July 1994, for contribution exemption for dedicated cross-border circuits used by Rochester Communications Inc. (RCI) (Rochester, New York) and World Media (Phoenix, Arizona) for voice and data services.
 WHEREAS Sprint stated that it provides these services at three separate border crossings;
 WHEREAS Sprint stated that the dedicated local loop (DLL) facilities are supplied by local access providers such as, but not limited to, Bell Canada (Bell), BC TEL, Unitel Communications Inc. (Unitel), Rogers Network Services and Vidéotron Télécom ltée;
 WHEREAS Sprint stated that the Canada-U.S. facility providers currently include Bell, BC TEL and Unitel;
 WHEREAS Sprint identified the end-users of the circuits in question as RCI and World Media;
 WHEREAS Sprint supplied affidavits wherein RCI attested that the circuits are dedicated to individual end-users of their services and World Media attested that the circuits are dedicated to that company's use;
 WHEREAS, by letter dated 25 November 1994, Stentor Resource Centre Inc. (Stentor) filed its comments on behalf of Bell;
 WHEREAS Bell noted that in accordance with the evidence requirements set out in Applications for Contribution Exemptions, Telecom Decision CRTC 93-2, 1 April 1993 (Decision 93-2) and in subsequent Commission Orders, a request for exemption of dedicated Canada-U.S. circuits should be supported by carrier verification, end-user affidavits or a technical audit;
 WHEREAS Bell submitted that since the canadian portion of the cross-border circuits is provided by Unitel, carrier verification would have to be provided by Unitel, and that to Bell's knowledge, no such verification had been provided;
 WHEREAS Bell stated that Sprint's second alternative is to provide end-user affidavits attesting that the circuits are used to provide dedicated services to individual customers;
 WHEREAS Bell submitted that the affidavits by the U.S. carriers are not end-user affidavits, since these carriers are in the business of providing services to others, and at least in the case of RCI, have stipulated that in fact the cross-border services are used to provide services to others;
 WHEREAS Bell stated that the third alternative available to Sprint is to have a technical audit completed;
 WHEREAS Bell submitted that since Sprint controls the cross-connection and the provision of the local circuits, Sprint should be required to provide satisfactory evidence to confirm that each circuit is configured to meet this requirement;
 WHEREAS Bell submitted that further satisfactory evidence is required to satisfy the Commission's established requirements for an exemption from contribution charges;
 WHEREAS, by letter dated 28 November 1994, Sprint submitted that Bell is incorrect in its interpretation of what constitutes an "end-user" for the purpose of determining eligibility for a contribution exemption;
 WHEREAS Sprint submitted that in Decision CRTC 93-2, it is very clear that "end-user" refers to the customer leasing the dedicated circuits from the reseller or the customer to whom the reseller provides service using the dedicated circuits;
 WHEREAS Sprint submitted that the "end-users" to which Sprint is reselling the circuits on a dedicated basis in this case are RCI and World Media and not the customers of these companies;
 WHEREAS Sprint submitted that it is superfluous to require affidavits from Sprint's end-users customers in these circumstances, when both RCI and World Media attest in their affidavits that the circuits are supplied to them by Sprint on a dedicated basis;
 WHEREAS Sprint noted that RCI further attests that in turn, "each of the individual circuits are dedicated to a single customer of RCI";
 WHEREAS the Commission notes that Decision 93-2 provides for three forms of evidence to support an application for exemption of this type;
 WHEREAS the Commission notes that Unitel would be unable to verify whether its circuits are dedicated to the use of each of the RCI or World Media customers and, accordingly, carrier verification si not viable in these cases;
 WHEREAS the Commission notes that since World Media circuits are no longer in operation, a technical audit is no longer viable in this case;
 WHEREAS the Commission notes that a technical audit would be viable for RCI's configuration;
 WHEREAS the Commission considers that, for the purposes of determining eligibility for a contribution exemption, an "end-user" refers to a user that originates and /or terminates traffic on the facility in question (i.e., the customer at the end of the circuit path);
 WHEREAS the Commission considers that neither RCI nor World Media are end-users of the circuits in question;
 WHEREAS the Commission accordingly considers that the affidavits provided by Sprint do not satisfy the Commission's evidentiary requirements;
 WHEREAS the Commission notes that the World Media circuits in question were in use from August 1992 to October 1993, while Sprint's exemption was filed in July 1994; and
 WHEREAS the Commission considers that Sprint has not satisfied the Commission that a retroactive exemption is warranted -
 IT IS ORDERED THAT:
 1. With respect to the circuits used by RCI, Sprint is directed to provide, within 60 days, a technical audit (verifying that fixed bandwidth is dedicated to each of the DLLs through the multiplexer) or end-user affidavits from RCI customers attesting that the circuits are dedicated to their use. Disposition of the RCI portion of Sprint's application is deferred pending the filing of the required information.
 2. The application with respect to the World Media is denied.
 Allan J. Darling
 Secretary General

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