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Ottawa, 20 January 1998
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Telecom Order CRTC 98-22
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By letter dated 20 October 1997, AIC Asia International Services (Ontario) Corporation (AIC) requested an exemption from contribution charges with respect to Digital Exchange Access circuits to be used exclusively for the carriage of Internet services. AIC attached an affidavit dated 16 October 1997 affirming that the circuits will be used solely for the purpose of Internet access.
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File No.: 8626-A37-01/97
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1. By letter dated 25 November 1997, Bell Canada (Bell) noted that AIC offers both voice and data services. Bell stated that in such cases, an exemption may be granted for facilities used for data traffic where such facilities are separate and partitioned from facilities used to carry voice traffic. Bell noted that where the carrier cannot verify the configuration, a technical audit is required to ensure that the service is configured to limit use to data traffic or in this case, Internet data traffic. Bell submitted that consistent with the Commission's previous determinations in similar cases, the submission of an affidavit does not satisfy the evidentiary requirements in the present case.
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2. Bell further noted that it does not control the AIC configuration and hence cannot confirm that the facilities will only be used for Internet data traffic. Accordingly, Bell submitted that, consistent with the current contribution exemption regime with respect to similar cases, a technical audit, accompanied by an engineer's affidavit, is required to verify the configuration and to confirm that appropriate control procedures are in place to ensure that the arrangement remains configured to qualify for an exemption on a going-forward basis.
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3. Bell also noted that in Telecom Order CRTC 97-590, 1 May 1997 (Order 97-590), the Commission determined that, effective 1 January 1998, jointly-used data networks which are interconnected to the public switched telephone network will be assessed contribution. Bell stated, however, that the Commission has also determined that networks used only to carry Internet data traffic will continue to be exempt from the requirement to pay contribution as of that date. In light of the above, Bell submitted that the configuration in question should be subject to a technical audit to ensure that it qualifies for a contribution exemption now and also as of 1 January 1998, when the new contribution regime pursuant to Order 97-590 takes effect. Bell also reserved the right to provide further comments upon receipt of a technical audit report from AIC.
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4. The Commission notes that: (1) pursuant to Applications for Contribution Exemptions, Telecom Decision CRTC 93-2, 1 April 1993, where a company offers both voice and data services, an exemption may be granted for facilities used for data traffic where such facilities are separate and partitioned from facilities used to carry voice traffic and where the carrier cannot verify the configuration, a technical audit by a registered professional engineer is required to ensure that the services are configured to limit use to data traffic (in this case Internet data traffic); (2) consistent with the current contribution exemption regime, the engineer must confirm that appropriate control procedures are in place to ensure that the arrangement remains configured to qualify for an exemption on a going-forward basis; and (3) in light of Order 97-590, the technical audit must ensure that the configuration in question carries only pure Internet traffic as of 1 January 1998 to maintain the exemption.
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5. In light of the foregoing, AIC's application is deferred, pending receipt of a technical audit as described above within 30 days of this Order.
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Laura M. Talbot-Allan
Secretary General
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This document is available in alternative format upon request.
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