ARCHIVED - Order CRTC 2001-416

Order CRTC 2001-416

Ottawa, 25 May 2001

Forbearance for single-line inside wiring granted for TELUS Québec

Reference: 8640-Q1-03/01

With some conditions, the Commission refrains from regulating single-line inside wire services provided by TELUS Québec Inc. Customers will be able to determine if transmission problems originate on their inside wiring, or on TELUS Québec's network.

TELUS Québec's forbearance application

TELUS Québec Inc. (then known as Québec-Téléphone) applied on 1 February 2001 for forbearance, in accordance with the Commission's powers under section 34 of the Telecommunications Act (the Act), from regulation of installation, repair and maintenance of telephone single-line inside wire services provided by the company.

TELUS Québec requested the same degree of forbearance from regulation of single-line inside wire services as the Commission granted to Bell Canada, Hurontario Telephones Limited and Télébec ltée in recent orders.

No party intervened with respect to this application by TELUS Québec.

The Commission's analysis of the application

The Commission finds that the market for single-line inside wiring services in TELUS Québec's territory is effectively competitive, with no regulatory or market barriers to entry by other service providers. Customers may have their inside wiring work done by the company, by competitors providing inside wiring services, or customers may also do their own inside wiring work, using, if they wish, materials and guides supplied by the company.

Analogous to views expressed in several prior decisions, the Commission considers that since the market for single-line inside wiring services is competitive, with no entry barriers, TELUS Québec would have no incentive to cross-subsidize single-line inside wire services with revenues from regulated services. This is the case because the company would lose market share to competitors if it raised prices to recover losses from below-cost pricing.

Further, the Commission considers that the split rate base accounting framework that the company implemented pursuant to Implementation of regulatory framework for Québec-Téléphone and Télébec ltée, Telecom Decision CRTC 97-21, dated 18 December 1997, is an additional safeguard against cross-subsidies from regulated or Utility services to inside wiring services provided by the company.

With respect to the installation, maintenance, rearrangement and repair of TELUS Québec's customers' single-line inside wiring services, the Commission will forbear from exercising its powers and duties under sections 24 (in part), 25, 29 and 31, and sections 27(1), 27(2), 27(3) (in part), 27(4), 27(5) and 27(6) of the Act.

Consistent with its decisions forbearing from the regulation of single-line inside wire services provided by Bell Canada, Hurontario and Télébec, the Commission finds that it would not be appropriate to refrain from exercising all its powers under sections 24 and 27(3) of the Act for these TELUS Québec services.

The Commission will retain sufficient powers under section 24 of the Act to specify current and possible future conditions for offering and providing single-line inside wiring installation, maintenance and repair services. Current conditions include protection of customers without jack-ended demarcation devices, as described below, in paragraph 13, as well as continued application of existing conditions for confidentiality of customer information, and continued protection of customer confidentiality in all future contracts and other arrangements for services which are forborne from in this order. Future conditions could include the requirement to provide competitors with access to inside wiring.

The Commission also considers it necessary to retain section 27(3) of the Act to ensure compliance with the powers and duties retained in this order.

In previous decisions, the Commission forbore when it was satisfied that customers would have the ability to determine whether transmission problems originate on the inside wiring for which they are responsible, or on the telephone company's network.

The Commission considers that customers with the jack-ended demarcation device installed by TELUS Québec will have this ability.

However, at present, the company has not installed the jack-ended demarcation device for all customers. The Commission considers that the interests of these customers must be protected through specific conditions. Accordingly, the Commission will make it a condition of forbearance that (a) customers without the jack-ended demarcation device will not be assessed a diagnostic charge to determine the source of transmission problems; and (b) the company will repair, without charge, the inside wiring of single-line customers without this demarcation device. These conditions should also be stated in the company's tariffs and the white pages of the company's telephone directories.

Pursuant to section 34(1) of the Act, the Commission finds, as a question of fact, that to refrain from exercising its powers and duties under sections 24 (in part), 25, 29 and 31, and sections 27(1), 27(2), 27(3) (in part), 27(4), 27(5) and 27(6) of the Act to the extent set out in this order with respect to the installation, repair and maintenance of single-line inside wiring by TELUS Québec would be consistent with the Canadian telecommunications policy objectives.

Pursuant to section 34(2) of the Act, the Commission finds as a question of fact that the provision of these services is sufficiently competitive to protect the interests of users.

Pursuant to section 34(3) of the Act, the Commission finds that to refrain from exercising the powers and performing the duties to the extent set out in this order would not likely impair the continuance of a competitive market for these services.

Commission grants forbearance subject to conditions

The Commission therefore orders that:

a) pursuant to section 34(4) of the Act, effective two weeks from the date of this order, sections 24 (in part), 25, 29 and 31, as well as sections 27(1), 27(2), 27(3) (in part), 27(4), 27(5) and 27(6) of the Act do not apply, to the extent that they are inconsistent with the determinations in this order regarding TELUS Québec's installation, maintenance, rearrangement and repair of single-line inside wire; and

b) TELUS Québec is directed to immediately issue tariff pages, to give effect to this order. The tariff pages must state that:

i) customers without a jack-ended demarcation device will not be assessed a diagnostic charge to determine the source of transmission problems; and

ii) the company will repair without charge the inside wiring of customers without a jack-ended demarcation device.

The conditions for customers without the jack-ended demarcation device must also be included in future editions of the white pages of the company's directories, as long as the company's service to some customers does not terminate on such a demarcation device.

Secretary General

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