ARCHIVED - Telecom Decision CRTC 2002-27

Telecom Decision CRTC 2002-27

Ottawa, 26 April 2002

Public Interest Advocacy Centre complaint alleging violation of basic toll schedule constraints by Bell Canada

Reference: 8661-P8-01/01

Summary

In the Fall of 2000, Bell Canada changed its First Rate long distance plan. In November 2001, the Public Interest Advocacy Centre (PIAC) filed a complaint with the Commission alleging that the changes effectively raised basic toll schedule rates, in contravention of a 1997 Commission decision to establish a ceiling on basic toll rates. PIAC also alleged that Bell Canada did not give its customers advance notice about the changes to the plan. PIAC accordingly asked the Commission to order Bell Canada and other carriers to stop charging First Rate customers non-discounted basic toll schedule rates and to refund any excess charges to subscribers resulting from the changes to the First Rate plan.

In this decision, the Commission denies PIAC's application. The Commission finds that the calls at issue in the complaint are made by First Rate plan customers, not basic toll schedule subscribers. The Commission also finds that Bell Canada did, in fact, provide advance notice of the changes to the First Rate plan. The Commission also notes that PIAC provided no evidence that other carriers were involved.

The application

On 2 November 2001, the Public Interest Advocacy Centre (PIAC) filed a complaint about Bell Canada billing practices. In its complaint, PIAC submitted that Bell Canada charges long distance rates that fail to include the applicable time-of-day discount. According to PIAC, this constituted rate increases contrary to the basic toll rate ceiling, which the Commission established in Forbearance - Regulation of toll services provided by incumbent telephone companies, Telecom Decision CRTC 97-19, 18 December 1997 (Decision 97-19).

To support its complaint, PIAC quoted paragraph 75 of Decision 97-19, which noted the benefits of a ceiling on basic toll rates, and paragraph 81, which, among other things, stated that "companies shall provide reasonable direct notice in writing to subscribers in advance of any increase to basic toll rates."

PIAC submitted that the toll rates paid by Bell Canada's First Rate plan subscribers during weekday daytime hours are for calls under the basic toll schedule, not under the First Rate plan.

PIAC noted that in the Fall of 2000, when Bell Canada changed the First Rate plan, it eliminated a weekday discount period between 6 a.m. and 8 a.m. PIAC submitted that calls made by First Rate plan subscribers during these times should have therefore been charged rates according to the basic toll schedule, which includes a 60% time-of-day discount. However, Bell Canada did not include the 60% discount in its charges to First Rate plan subscribers who made weekday calls between 6 a.m. and 8 a.m.

PIAC submitted that in effect, Bell Canada increased its basic toll rates in a specific circumstance by more than 60%, contrary to the ceiling established by the Commission in Decision 97-19.

PIAC further alleged that Bell Canada revised its First Rate plan without any notice to subscribers.

By way of relief, PIAC requested that the Commission order Bell Canada and all other incumbent local exchange carriers to, at a minimum:

a) cease charging discount toll plan subscribers non-discounted basic toll rates during normal basic toll rate discount periods; and

b) refund to all overcharged subscribers the amounts overcharged, with interest.

Bell Canada was the only party that responded to PIAC's submission.

Bell Canada's reply

In its reply on 5 December 2001, Bell Canada submitted that the rates charged to First Rate subscribers for weekday calls made between 6 a.m. and 8 a.m. are not part of the basic toll schedule, but are part of the First Rate toll plan. Bell Canada also noted that in Decision 97-19, the Commission decided it would forbear from regulating the rates and all other elements for this and other toll plans.

Bell Canada stated that the basic toll schedule applies to users who do not subscribe to a Bell Canada toll plan, such as the First Rate plan. Customers who subscribe to a toll plan are not considered to be basic toll customers.

Bell Canada noted that under the First Rate plan, toll calls between 8 a.m. and 6 p.m. are considered to be outside the applicable First Rate plan discount hours and are charged at the basic toll schedule rates. Calls placed between 6 a.m. and 8 a.m. are also considered to fall outside the discount period of the First Rate plan and are charged at the same undiscounted First Rate daytime rate as calls made between 8 a.m. and 6 p.m.

Bell Canada submitted that it would be incorrect to assume that a First Rate subscriber or a subscriber to another toll plan could make calls at all times of day and every day of the week, and always be charged rates equivalent to or less than basic toll rates. The company offers a number of other toll plans that may better meet a particular customer's calling patterns.

With regard to the allegation that notice was not provided to First Rate customers about changes to the plan, Bell Canada stated that a Short Information Message (SIM) was included on customer bills issued between 28 September 2000 through 25 October 2000. The SIM advised customers about changes to the weekday daytime rates for First Rate subscribers. The SIM also included a 1-800 toll-free number that customers could call for more details. Bell Canada acknowledged that the SIM might have been more explicit.

In addition, Bell Canada noted that during the first three months following the rate changes, the company provided refunds to customers who indicated that they did not understand the changes.

Bell Canada regretted that there may have been some confusion over the extent of discounts under the First Rate toll plan, based on some of the material printed in the introductory pages of Bell Canada's directories. The company noted that these pages were being amended in its new directories.

PIAC' s reply comments

In its 12 December 2001 submission to the Commission, PIAC stated that it had no more comments with respect to the alleged violation of the basic toll schedule rate ceiling by Bell Canada.

PIAC noted that the implication of Bell Canada's clarified position is that many customers may be better off under the regular basic toll schedule than under the First Rate plan. For example, some customers may be better served by the 60% discount on regular long distance rates than by other plans.

PIAC stated that should the Commission determine that the calls in question are not basic toll schedule calls, but First Rate calls billed at regular basic toll schedule rates as argued by Bell Canada, then the Commission should consider continuing the cap on the basic toll schedule in the proceeding initiated by Price cap review and related issues, Public Notice CRTC 2001-37, 13 March 2001 (the price cap proceeding). PIAC also stated that it is important that Bell Canada and other incumbent local exchange carriers that offer the same service be required to properly notify their First Rate customers of the fact that undiscounted basic toll schedule rates apply between 6 a.m. and 8 a.m.

Commission's findings and determination

The Commission notes Bell Canada's submission that calls placed between 6 a.m. and 8 a.m. by First Rate plan customers fall outside the discount period of the First Rate plan and are charged at the same undiscounted First Rate daytime rate. These calls are made by First Rate plan customers, not basic toll schedule customers. Therefore, these calls are not basic toll calls and the charges are not subject to a basic toll schedule rate discount.

The Commission also notes that customers are free to choose different long distance plans that suit them and may select different plans if their calling pattern changes.

The Commission notes that PIAC provided no evidence that any other incumbent local exchange carrier was in possible violation of the ceiling on basic toll rates set out in Decision 97-19.

In light of the above, the Commission denies PIAC's application.

With respect to the issue of notice to subscribers, the Commission notes that the rates in question are not for basic toll schedule service, and accordingly, that the requirement set out in Decision 97-19 for incumbent local exchange carriers to provide subscribers reasonable direct advance notice of any increase to basic toll schedule rates is not applicable in this case. Nevertheless, when incumbent local exchange carriers provide such notice to subscribers of any rate changes to competitive toll discount plans, the Commission considers that it is important that these messages be clear.

With respect to PIAC's suggestion in its reply comments, that the Commission consider continuing the cap on the basic toll schedule in the price cap proceeding and make detailed rules on how all local service providers and/or long distance providers should provide notice of rate changes, the Commission considers that these issues are outside the scope of the application filed by PIAC and therefore, cannot be addressed in the context of this process.

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