ARCHIVED - Telecom Order CRTC 2002-201

Telecom Order CRTC 2002-201

Ottawa, 16 May 2002

Aliant Telecom Inc. - Late payment charges

Reference: Aliant Telecom tariff notice (TN) 10; Island Tel TNs 555 and 555A, MTT TNs 801 and 801A, NBTel TNs 862 and 862A, and NewTel TNs 657 and 657A

The application

1.

Aliant Telecom Inc. (Aliant Telecom) submitted an application dated 27 February 2002 to move its four regional Late Payment Charge tariffs to the Aliant Telecom General Tariff. The late payment charge is a charge that is applied when a customer does not remit payment on his or her account within a prescribed period of time.

2.

Aliant Telecom also proposed to align the minimum late payment charge for customers in New Brunswick, Newfoundland and Prince Edward Island in order to be consistent with the charge of $1.25 previously approved for Nova Scotia pursuant to Telecom Order CRTC 95-79, 27 January 1995.

3.

Aliant Telecom submitted that the application is intended to establish a common credit policy among the four provinces served by Aliant Telecom in order to realize operational efficiencies as intended upon merging the four former incumbent local exchange carriers (ILECs): Island Telecom Inc. (Island Tel), Maritime Tel & Tel Limited (MTT), NBTel Inc. (NBTel) and NewTel Communications Inc. (NewTel) (collectively, the Aliant Telecom companies).

4.

Aliant Telecom stated that, in New Brunswick and Newfoundland, only those customers with overdue amounts that currently result in a late payment charge of less than $1.25 would be affected by the proposed change. In Prince Edward Island, only those customers with overdue accounts resulting in late payment charges between $1.00 and $1.25 would be affected.

5.

Aliant Telecom submitted that the current late payment charge is not at a level that effectively encourages customers to pay in a timely manner. Aliant Telecom also noted that late payment charges are treated as uncapped within the current price cap regulatory regime because of their discretionary nature: customers can avoid late payment charges by paying their bills within a reasonable period of time using the many available payment-method options. Further, Aliant Telecom noted that the proposed late payment charges are reasonable, have been previously approved by the Commission for MTT and are consistent with the rules that the Commission established for the treatment of such services under the current price cap regulatory regime.

Commission findings and determination

6.

The Commission notes that the Aliant Telecom companies' late payment charges are based on the monthly equivalent of the per annum prime rate of one of the major banks plus 7%, in accordance with a formula approved by the Commission on 23 January 1984. The Commission has previously approved minimum late payment charges of $1.00 and $1.25 for customers in the former Island Tel serving territory of Prince Edward Island and customers in the former MTT serving territory of Nova Scotia, respectively, while the former NBTel and the former NewTel do not have minimum late payment charges for customers in the respective serving territories of New Brunswick, and Newfoundland and Labrador.

7.

In CRTC denies proposals to introduce or increase minimum late payment charges, Order CRTC 2000-1003, 3 November 2000 (Order 2000-1003), the Commission denied an application from MTT to increase Island Tel's minimum late payment charge from $1.00 to $1.25 and to introduce a minimum late payment charge of $1.25 for NBTel and NewTel. The Commission found that the current rates provided adequate compensation for late payments.

8.

The Commission is of the preliminary view that, consistent with its determination in Order 2000-1003, the current charges, with no minimum late payment charge, provide adequate compensation for late payments. The Commission is also of the preliminary view that consistent with the tariffs of all of the other ILECs in Canada, a minimum late payment charge should not be maintained for customers in the former Island Tel serving territory of Prince Edward Island and customers in the former MTT serving territory of Nova Scotia. The Commission considers, however, that it is appropriate to seek public comment on its preliminary views.

9.

In light of the above, the Commission approves the proposal by Aliant Telecom to move its four regional Late Payment Charge tariffs to the Aliant Telecom General Tariff, and denies the proposed changes to the minimum late payment charges. The Commission hereby initiates a proceeding calling for comments on the preliminary views as set out in paragraph 8 of this order.

Procedure

10.

Aliant Telecom is made a party to this proceeding. Other parties wishing to participate fully in this proceeding must notify the Commission of their intention to do so, by 27 May 2002. They should contact theSecretary General by mail at CRTC, Ottawa, Ontario, K1A 0N2, by fax at (819) 953-0795 or by email at procedure@crtc.gc.ca. They are to indicate in the notice their email address where available. If parties do not have access to the Internet, they are to indicate in their notice whether they wish to receive disk versions of hard copy filings.

11.

The Commission will issue, as soon as possible after the registration date, a complete list of interested parties and their mailing addresses (including their email address, if available), identifying those parties who wish to receive disk versions.

12.

Aliant Telecom and interested parties may file comments with respect to the Commission's preliminary views, serving copies with the Commission and on all other parties, by 17 June 2002.

13.

All parties may file reply comments with the Commission, serving a copy on all other parties, by 25 June 2002.

14.

Where a document is to be filed or served by a specific date, the document must be actually received, not merely sent, by that date.

15.

Parties can file their submissions on paper or electronically. Submissions longer than five pages should include a summary.

16.

Submissions filed in electronic form should be in the HTML format. As an alternative, those making submissions may use Microsoft Word for text and Microsoft Excel for spreadsheets.

17.

Please number each paragraph of your submission. In addition, please enter the line ***End of document*** following the last paragraph. This will help the Commission to verify that the document has not been damaged during transmission.

18.

Only those submissions filed in electronic form will be placed on the Commission's web site at www.crtc.gc.ca  and only in the official language and format in which they are submitted.

19.

The Commission also encourages interested parties to monitor the public record of this proceeding (and/or the Commission's web site) for additional information that they may find useful when preparing their submissions.

Location of CRTC offices

20.

Submissions may be examined or will be made available promptly upon request at the Commission offices during normal business hours:

Central Building
Les Terrasses de la Chaudière
1 Promenade du Portage, Room G-5
Hull, Quebec K1A 0N2
Tel: (819) 997-2429 - TDD: 994-0423
Fax: (819) 994-0218

Bank of Commerce Building
1809 Barrington Street
Suite 1007
Halifax, Nova Scotia B3J 3K8
Tel: (902) 426-7997 - TDD: 426-6997
Fax: (902) 426-2721

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