ARCHIVED -  Telecom - Commission Letter - Local Competition, Telecom Decision CRTC 97-8, 1 May 1997: Follow-Up Process - Commission Decision Regarding CRTC Interconnection Steering Committee (CISC) Dispute on the Definition of End-Customer

Letter

Ottawa, 18 May 1999

VIA FACSIMILE

To: PN 96-28 Distribution List

Re: Local Competition, Telecom Decision CRTC 97-8, 1 May 1997: Follow-Up Process - Commission Decision Regarding CRTC Interconnection Steering Committee (CISC) Dispute on the Definition of End-Customer

Dear Madam or Sir:

The Customer Transfer Sub-Working Group (CTSWG) of CISC prepared a draft consensus report dated 17 February 1998 that included the definition of "End-Customer". Parties supporting the consensus report include ACC Long Distance Inc., AT&T Canada Long Distance Services, BCTEL, Bell Canada, CAC/FNACQ/NAPO, Call-Net Enterprises Inc., fONOROLA Inc., Telus Communications Inc., Microcell Telecommunications Inc., Rogers Network Services and Vidéotron Télécom ltée. One party, TelcoPlus, did not agree with the definition and initiated a dispute.

Background and Position of Parties

The draft consensus report provided the following definition of end-customer:

"End-Customer" means the ultimate user of local telephone services sold on a retail basis, and (a) in the case of a multi-person household, is the person within that household responsible for changes to local telephone services. This will be the person named on the existing Local Exchange Carrier's (LEC) customer account, or his or her agent¹; and (b) in the case of a business customer, is the business entity. The business may designate any individual to act as its representative, and may change its named representative at any time.

TelcoPlus expressed concern with the use of the word "agent" because, in its view, the need to confer agency to a second party bestows to the current subscriber the power to control all telecommunications services delivered to that household. In TelcoPlus' view, this requirement does not currently exist. TelcoPlus is also of the view that the word "agent" implies that there may be some legal standard that must be adhered to in the transmission of control over telecommunications in a household. Such a situation, in TelcoPlus view, could prove onerous and might create a barrier to residential subscriber acquisitions.

TelcoPlus suggested that the phrase "or his or her agent" should be replaced by "an authorized adult member (authorized employee) of the household (business) requesting the change". In its view, the suggested wording would more appropriately reflect the nature of the day-to-day operation of most households and would permit a LEC to develop a simpler format for service transfer authorization.

The parties in support of the draft consensus report definition were of the view that the "End-Customer" should be defined as the individual account holder rather than "an authorized adult member of the household", for a number of reasons:

1. Households are not legal entities.

2. TelcoPlus's proposed use of the term "authorized" is ambiguous, without specifying by whom and for what purpose the authorization was given.

3. Contracts between an individual (or individuals) and a service provider should be respected, in keeping with the legal doctrine of privity of contract; other people should not be able to terminate contracts for service to which they are not party, unless duly authorized by one of the parties. Respect for this legal principle is particularly important since it is the individual account holders who will be liable in the event of breach of contract.

4. Relationships between individual household members vary, and cannot therefore be assumed. While all adult members of some households may share responsibility for telephone service, this will not always be the case. A company cannot know, without asking, whether the person it is dealing with has authority from the registered account holder to switch telephone service providers.

5. If companies are permitted to deal with non-account holders within a household, without making reasonable efforts to ensure that these individuals have authority from the account holder to switch service providers, there is likely to be greater customer churn and more transfer disputes, resulting in increased costs to the industry (not to mention customer turmoil).

6. The CTSWG proposed definition of "End-Customer" is consistent with the definition of "customer" in the Incumbent LECs (ILEC) tariffs.

7. The CTSWG proposed definition of "End-Customer" is consistent with the approach taken in the long distance industry, when disputes relating to the identity of the End-Customer occur.

8. The CTSWG "consensus" approach expressly recognizes that spouses or other third parties may have authority from the named account-holder to act on his/her behalf in respect of choosing telephone service providers. This is the essence of "agency".

The Commission's Determination

In Definition of Customer, Telecom Decision CRTC 97-4, 26 February 1997 (Decision 97-4), the Commission directed that certain companies include the following definition of customer in their General Tariffs: "A person or legal entity, including a reseller or sharing group, that purchases telecommunications services from the company, and is liable to the company for those services."

In the Commission's view, the definition of end-customer proposed in the draft consensus report is consistent with the definition of customer that companies were directed to use in Decision 97-4. The use of the word "agent" is a logical extension of that definition and in itself should not be considered problematic. Since the approach expressly recognizes that spouses or other third parties may have authority from the named account-holder to act on his/her behalf in respect of choosing telephone service providers, it should not be overly difficult for a LEC to acquire a residential subscriber.

One of the objectives of the verification process is to ensure that the person who permits or orders changes to the services is indeed authorized to do so. The Commission does not consider that the use of the word "agent" places an unreasonable burden on the process.

The Commission notes that a footnote to the draft consensus report states that "Another member of the household could be an agent of the End-Customer". The Commission is of the view that adding the intent of this phrase to the definition proposed in the draft consensus will clearly indicate that a member at the household can be an agent of the end-customer.

Therefore, the Commission directs that the definition of end-customer proposed in the draft consensus report be amended to insert the phrase "such as an authorized adult member of the household" after the word "agent" in part (a) of the draft definition.

Yours sincerely
Original signed by
J.P. Blais for
Secretary General

¹An agent must have authority from the End-Customer to act on his or her behalf. Another member of the household could be an agent of the End-Customer.

c.c. Chaouki Dakdouki, CRTC (819) 997-4400

Date Modified: 1999-05-18