ARCHIVED - Decision CRTC 2001-617

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Decision CRTC 2001-617

Ottawa, 1 October 2001

Reference: 8638-C12-45/00

To: Telecommunications service providers

Subject: Decision CRTC 2000-745 - Final 2001 revenue-percent charge for contribution set at 4.5%

On 30 November 2000, the Commission issued Decision CRTC 2000-745, Changes to the contribution regime. In this decision, the Commission replaced the per-minute contribution mechanism with a national contribution collection mechanism based on revenues from all telecommunications service providers (TSPs). The new mechanism came into effect on 1 January 2001.

The new revenue-based regime requires all TSPs, who meet the minimum threshold of $10 million in annual Canadian telecommunications services revenues, to remit a contribution to the national subsidy fund, based on a percentage of the contribution-eligible revenues of the TSP.

In paragraph 126 of the decision, the Commission set the interim 2001 revenue-percent charge at 4.5%. This was based on the financial information available from the proceeding leading to the decision.

In paragraph 129 of the decision, the Commission indicated that it would finalize the 2001 revenue-percent charge following the filing of the actual audited year 2000 financial statements of all TSPs. This information was required to be filed on 30 April 2001, following the release of Orders CRTC 2001-220, Industry consensus reports submitted by the contribution collection mechanism (CCM) implementation and Order CRTC 2001-221, Disputed issues submitted by the contribution collection mechanism (CCM) implementation working groups, dated 15 March 2001, and various clarifications, which further defined the revenue classifications contained in the decision.

In assessing whether there are, or will be, appropriate contribution-eligible revenues, the Commission has taken into consideration:

the year 2000 annual contribution-eligible revenues filed by all TSPs who are required contributors to the national fund;

the adjustments related to the year 2000 annual filings and 2001 monthly revenue filings with the Central Fund Administrator (CFA); and

the actual contribution-eligible revenues for 2001 as filed with the CFA from 1 January 2001 to 31 July 2001.

The actual year 2000 contribution-eligible revenues for all TSPs that are required contributors under the new revenue-based regime were lower than the amount of contribution-eligible revenues estimated in the proceeding that led to the decision. This is primarily due to the fact that the full financial impact of some of the allowable deductions from contribution-eligible revenues was unknown at the time of the decision.

However, the Commission notes that the year 2001 contribution-eligible revenues filed by all TSPs on a monthly basis with the CFA are growing over year 2000 levels and are expected to continue to grow throughout 2001.

The Commission is of the view that the estimated subsidy requirements set out in Decision 2000-745 should be achieved with a revenue-charge of 4.5%. The Commission is also of the view that based on the year 2000 financial information and trends noted in 2001 filings, any over- or under-collection of subsidy will not be material.

Therefore, the Commission finalizes the 2001 revenue-percent charge at 4.5%, effective 1 January 2001.

Ursula Menke
Secretary General

c.c. Mario Bertrand, CRTC (819) 997-4576
Al DeCaigny, CFA

Date Modified: 2001-10-01

Date modified: