ARCHIVED -  Telecom Order CRTC 99-340

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Telecom Order


Ottawa, 12 April 1999


Telecom Order CRTC 99-340


In a letter dated 14 May 1998, the Commission requested comments on whether or not, in a Local Number Portability (LNP) environment, an Interexchange Carrier (IXC) that uses line-side facilities, pursuant to a tariff, is responsible for terminating the call to the appropriate Local Exchange Carrier (LEC). The Commission received comments, on 3 June 1998, from AT&T Canada Long Distance Services Company (AT&T Canada LDS), Clearnet Communications Inc. (Clearnet), fONOROLA Inc. (fONOROLA) and Stentor Resource Centre Inc. (Stentor), on behalf of BC TEL, Bell Canada, Island Telecom Inc. (formerly, The Island Telephone Company Limited), Maritime Tel & Tel Limited, MTS Communications Inc., The New Brunswick Telephone Company, Limited (now called NBTel Inc.), NewTel Communications Inc. and TELUS Communications Inc. (collectively, the Companies). AT&T Canada LDS, Call-Net Enterprises Inc. (Call-Net), on behalf of fONOROLA and Sprint Canada Inc. (Sprint), and Stentor filed reply comments on 10 June 1998.


File No.: 96-2376


1.Call-Net, on behalf of fONOROLA and Sprint, sent a letter to the Commission, dated 14 April 1998, requesting that the status quo for existing line-side arrangements continue until the dispute which precipitated the Commission's letter referred to above has been resolved.


2.Stentor replied, in a letter dated 14 May 1998 stating that the companies would be prepared to route and deliver IXCs' line-side traffic on a status quo basis, provided the companies retain the ability to recover costs when the dispute is resolved.


3.FONOROLA submitted that the provision of line-side arrangements is a retail service that incumbent local exchange carriers (ILECs) are already paid to terminate calls to the appropriate carrier and that no proof has been offered to indicate that the costs are different from those of retail subscribers.


4.AT&T Canada LDS affirmed that it will comply with its responsibility as an N-1 carrier to perform the query processing required to route calls and that an IXC that uses line-side termination (e.g., Feature Group A (FG A) facilities) through a tariff is only responsible for terminating the call to a local carrier that is either the final local carrier where direct connections exist or the local carrier providing the transit network.


5.AT&T Canada LDS stated that Local Routing Number (LRN) information will not be passed on to the local carrier when an FG A connection is used and that in such cases a second query may be necessary for the completion of the call. AT&T Canada LDS considers that this functionality is implicit in the service being purchased from the FG A provider.


6.Clearnet submitted that LNP query processing amounts to an inherent capability for in-band interconnection arrangements and that an FG A or equivalent tariffed network access constitutes a potential alternative business arrangement for the LNP query processing function on behalf of the IXC.


7.Clearnet stated that the LNP query processing capability requirement with in-band interconnection should not be used to rationalize the discontinuation of FG A or any other in-band interconnection.


8.Stentor submitted that the competitors' objective is to avoid the obligation of performing LNP query processing and obtain transiting service at no cost.


9.Stentor submitted that the competitors' argument for being treated as a retail customer is premised upon a false assumption regarding the status of carriers and gives undue preference to line-side interconnection arrangements. Furthermore, Telecom Decision CRTC 92-12, and subsequent Commission determinations have established that the privileges and obligations of IXCs differ from those of retail customers.


10.Stentor submitted that the requirement to make general tariffs available was not meant to create competitive disadvantages against the Companies or other LECs who receive IXC FG A traffic and that FG A was meant as a temporary measure to allow the entry of IXC competition in areas where Feature Group D trunk-side interconnection was not available.


11.Stentor noted that carriers can purchase a variety of services at rates that would not be available or offered to retail customers, sharply differentiating competitors from other customers. It submitted that levying charges for LNP query processing would thus not be inconsistent with section 27(2) of the Telecommunications Act.


12.The Commission notes that FG A interconnection arrangements are one of the North American-wide telecommunications industry accepted interconnection arrangements that can be selected and established between an IXC and a LEC end-office for the exchange of traffic.


13.The Commission notes further, however, that unlike trunk-side interconnections, line-side interconnections are unable to transfer the signalling information needed to provide services such as caller name and number display. Accordingly, they provide an inferior grade of service to end-users.


14.The Commission notes that a primary argument in the dispute centres around the fact that the general tariff for line-side access arrangements currently applies to both retail customers who use the service for end-to-end telecommunications services and IXCs that may use FG A line-side access for network-to-network interconnection.


15.IXCs argue that they are simply seeking to continue obtaining the same service currently offered to retail customers using line-side interconnection (e.g., banks, major companies). The Commission notes, however, that in contrast to retail customers such as banks, IXCs are carriers and are using those line-side links to terminate toll calls from paying customers.


16.The Commission notes further that IXCs and resellers are required to pay contribution on those calls, whereas private users are not. Accordingly, the Commission considers that it would not be inappropriate for a different tariff to apply in the case of IXCs.


17.In Commission's view, from the perspective of a long distance caller who is interested in simple telephony, it would seem logical for it to be the caller's long distance service provider that is responsible for routing the call to the appropriate destination.


18.Similarly, from the perspective of the local service provider in whose serving area the called party resides, it would seem logical for it to be the long distance service provider's responsibility to provide the routing information needed by the local service provider to complete the call. In the Commission's view, this analysis is equally valid whether the interconnection is line-side or trunk-side.


19.The Commission notes that in the case of trunk-side interconnections, it is well established not only that IXCs are responsible for the LNP processing function, but that if they are not capable of doing so, they must pay an appropriate amount to the ILEC for performing the function on their behalf.


20.In this regard, on 29 July 1998, the Commission granted interim approval to a Stentor tariff surcharge of $7.50 per interconnecting DS-0 per month.


21.In addition, when an IXC uses trunk-side connections, it must also pay for any transiting services it requires in order to be able to terminate its customers calls to parties whose local service provider is a competitive local exchange carrier (CLEC).


22.In light of the above, the Commission considers that the N-1 carrier should be responsible for performing the query processing for toll calls in an LNP environment, regardless of the type of interconnection used. While the Commission considers that FG A should continue to be recognized as an acceptable form of interconnection, it further considers that, owing to the inferior quality of FG A interconnections, it would not be in the public interest to create price incentives to promote their use by carriers.


23.Accordingly, the Commission considers that the Companies should offer FG A interconnections to carriers under a separate tariff, with specific additional charges for performing LNP query service and, if required, for providing transiting service to another LEC in the same exchange.


24.Therefore, the Commission orders that:


a) LECs (ILECs and CLECs) may file proposed revisions to their tariffs to allow for FG A interconnection at rates different from those for network access services provided to local end users;


b) the Companies are to issue tariff pages for the interim rate of $7.50 per interconnecting FG A circuit per month, as a surcharge for performing the necessary LNP query processing and call routing functions; and


c) the Companies are to file proposed tariff pages, within 90 days, for a final cost based rate per interconnecting FG A for performing the LNP query processing and call routing functions.


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Secretary General


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