ARCHIVED -  Telecom Order CRTC 99-64

Telecom Order

Ottawa, 25 January 1999

Telecom Order CRTC 99-64

By letter dated 2 July 1998, Tick Talk Communications Inc. (Tick Talk) applied for contribution exemption for Centrex systems in Oakville and Burlington, Ontario. With its submission, Tick Talk provided a copy of a technical audit report of the Centrex systems dated 29 June 1998. Tick Talk stated that the Burlington system was converted from a double-hop system to a single-hop and double-hop system in February 1998.

File No.: 8626-T16-02/97

1.By letter dated 20 July 1998, Bell Canada (Bell) stated that it has reviewed the technical audit report and noted that in general it appears to verify that the systems are configured to be exempt from contribution. Bell stated that the auditor has confirmed that application software, which was designed by the auditor to be used with the Centrex systems, selects the appropriate Virtual Facility Group (VFG) for routing of a call on the basis of the originating calling line identification. Bell stated that single-hop calls are routed via contribution-exempt VFGs, while multiple-hop calls are routed using contribution-attracting VFGs.

2.Bell stated that the auditor has also advised that control of the application software rests with the auditor, not Tick Talk. Bell stated that when modifications are required, the auditor verifies the appropriate routing before making the modification and advises Tick Talk in writing that the modifications will not alter the eligibility of the systems for contribution exemption. Bell stated that since Tick Talk cannot alter the application software, including the list of exchanges which are validated as single-hop and contribution-exempt, the auditor contends that appropriate control procedures are in place to ensure that the system will continue to route calls correctly based on their eligibility for an exemption.

3.Bell noted that the technical audit provided does not include an affidavit from the auditor. Bell submitted that pursuant to Applications for Contribution Exemptions, Telecom Decision CRTC 93-2, 1 April 1993, the submission of a technical audit must be accompanied by an affidavit from the auditing engineer.

4.In light of the above, Bell agreed with the exemption effective the date of application, subject to the provision of a satisfactory affidavit from the auditor attesting to the accuracy of Tick Talk's application.

5.Tick Talk provided the engineer's affidavit dated 8 September 1998, which was deficient. The Commission received on 29 October 1998 a revised affidavit from Tick Talk dated 19 October 1998.

6.By letter dated 30 November 1998, Bell clarified its previous submission dated 20 July 1998. In its 20 July 1998 submission, Bell had stated that "...[t]he Burlington and Oakville systems were originally used only to provide single hop services but were converted in February 1998 to offer multiple hop services as well." In its November letter, Bell stated that it has now become apparent that although this statement is correct with respect to the Oakville Centrex system, it should be clarified with respect to the Burlington Centrex system.

7.Bell stated that it had conducted a further review of its records associated with the Burlington Centrex system, and noted that installation was completed 16 March 1998. Bell stated that at that time of installation, the system was configured to permit both single-hop and multiple-hop calling via separate VFGs. However, Bell stated that since Tick Talk did not have a contribution exemption with respect to the single-hop VFG when used on the same system with a multiple-hop configuration, contribution charges have been assessed on both VFGs since March 1998.

8.The Commission is of the view that Tick Talk has provided a satisfactory technical audit that meets the evidentiary requirements for single-hop circuits included in multiple-hop Centrex systems and notes that Bell also agreed. The Commission also is of the view that the revised engineer's affidavit is satisfactory.

9.The Commission notes Bell's suggestion that the effective date for the exemption should be the date of application. The Commission notes that in Telecom Order CRTC 98-560 dated 8 June 1998 (Order 98-560), it has already approved an exemption for single-hop services for Oakville effective the date of addition of double-hop services such that no contribution applies on the single-hop circuits. Since Tick Talk has simply provided an updated technical audit for Oakville, the Commission considers that the effective date as set out in Order 98-560 for Oakville should continue in effect.

10.In Effective Date of Contribution Exemptions, Telecom Public Notice CRTC 95-26, 12 June 1995, the Commission stated that the contribution exemptions would generally be granted effective the later of the date of application or the date of installation, absent special circumstances. The Commission notes that there was a delay of about four months from the date of installation to the date of Tick Talk's application for Burlington. The Commission notes that the technical audit (updating and extending an earlier audit for Oakville) supporting the present application was completed on 29 June 1998. Given that it takes some time to work on and complete an audit, the Commission considers that Tick Talk likely engaged the auditor soon after the installation was complete and that it took the necessary steps in a timely manner in order to advance the contribution exemption process.

11.Accordingly, the Commission is of the view that it would be appropriate to approve the application at Burlington effective the date of installation such that no contribution would be payable on the single-hop circuits.

12.In light of the foregoing, Tick Talk's application is approved for:

(i) Oakville, such that no contribution applies on the single-hop circuits (and thus the exemption as previously set out in Order 98-560 will continue in effect); and

(ii) Burlington, effective the date of installation, such that no contribution applies on the single-hop circuits.

Secretary General

This document is available in alternative format upon request and may also be viewed at the following Internet site: www.crtc.gc.ca