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Ottawa, 8 June 1998
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Telecom Order CRTC 98-559
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By letter dated 4 December 1997, ITNets Inc. (ITNets) requested a contribution exemption with respect to overseas private line circuits provided by Teleglobe Canada Inc. (Teleglobe). ITNets provided a schematic diagram describing its network configuration. ITNets described its service as a "fax-to-fax service over the Internet in overseas countries". Further, ITNets noted that it does not use Bell Canada (Bell) local facilities to complete its fax calls and that all of the traffic sent through ITNets' network is originated overseas and terminated overseas.
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File No.: 8626-J9-01/97
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1. By letter dated 12 March 1998, Bell submitted that in cases where an exemption from contribution charges has been granted to a configuration used for transit traffic, evidence in support of an application for exemption has consisted of either carrier verification or a technical audit to confirm that the service is configured to prevent traffic originated or terminated in Canada from being carried on the circuits to be exempted. As examples, Bell referred to Telecom Orders CRTC 96-39, 97-453, and 97-662.
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2. Bell noted that ITNets has advised the Commission that the transit traffic is routed through its central node in Canada which is in turn connected to Teleglobe's international gateway. Bell submitted that where a reseller operates its own switching equipment in Canada, the Commission has in the past required a technical audit to confirm that traffic through the Canadian switch is not routed to or from the Canadian public switched telephone network (PSTN).
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3. Bell also stated that it has no record of ITNets having registered as a reseller. Bell submitted that such registration is required where Canadian facilities will be used for resale. Accordingly, Bell submitted that ITNets should be required to register with the Commission, Teleglobe and Bell as a reseller.
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4. In light of the above, Bell submitted that the application by ITNets should be deferred pending provision of suitable evidence to support an application for exemption from contribution charges and subject to the receipt of a letter of registration with the Commission, Teleglobe and Bell. Bell submitted that such evidence should consist of a technical audit confirming that the service arrangement is configured so that no calls can originate or terminate in Canada, and that suitable controls exist to prevent changes to the configuration which would permit such calls in the future.
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5. By letter dated 17 March 1998, ITNets provided the following additional information: (1) a notification of change in the company name from ITNets to ITNets Inc.; (2) a description of its fax business which is derived from traffic originating from overseas; (3) an application for registration as a reseller; (4) an application for exemption for its transit traffic; and (5) a notification that traffic terminated in Canada is being delivered to its final destination through Sprint Canada Inc. (Sprint Canada) facilities and that ITNets is paying Sprint Canada contribution charges for this traffic.
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6. ITNets provided a description of traffic transiting through Canada, and traffic terminating in Canada, supported by a network schematic diagram.
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7. In Applications for Contribution Exemptions, Telecom Decision CRTC 93-2, 1 April 1993, the Commission found that exemptions should be granted for transit traffic provided that satisfactory evidence is furnished to support a claim that there is no connection to the domestic networks. The Commission agrees with Bell that the appropriate evidentiary requirement to support ITNet's application is a technical audit confirming that transit traffic is switched through each node without leakage to the Canadian PSTN network.
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8. In light of the foregoing, the Commission finds that:
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(i) the appropriate evidentiary requirement in this case is a technical audit; and
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(ii) the application is deferred pending submission within 30 days of this Order of a satisfactory independent technical audit, confirming that there is no leakage to the PSTN on the transit portion of the network.
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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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