ARCHIVED - Telecom Decision CRTC 2004-33
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Telecom Decision CRTC 2004-33 |
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| Ottawa, 21 May 2004 | |
Application by TELUS Communications (Québec) Inc. for use of the deferral account to mitigate the negative impact of a retroactive rate increase for optional residential services for subscribers in high cost serving areas |
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| Reference: 8678-T69-200318057 | |
| In this decision, the Commission denies TELUS Communications (Québec) Inc.'s application to use the deferral account to offset the loss of income caused by a rate increase that the company chose not to make retroactive. | |
Background |
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1. |
In Implementation of price regulation for Télébec and TELUS Québec, Telecom Decision CRTC 2002-43, 31 July 2002 (Decision 2002-43), the Commission asked the companies to file their annual price caps for 2002 by 1 October 2002. The Commission made the rates interim as of 1 August 2002. |
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2. |
In Tariff Notice 333, submitted to the Commission on 1 October 2002, TELUS Québec asked the Commission to approve changes to its General Tariff as part of its first price cap filing, further to Decision 2002-43. For the sub-basket of optional residential services, TELUS Québec asked that its proposed rate increases of $1 per month take effect on 1 August 2002 for SmartTouch services and 1 February 2003 for residential bundles. |
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3. |
In Société en commandite Télébec and TELUS Communications (Québec) Inc. 2002 annual price cap filings, Telecom Decision CRTC 2003-57, 22 August 2003 (Decision 2003-57), the Commission approved the rate increases submitted by TELUS Québec in Tariff Notice 333. The Commission indicated that the rate increases could take effect on a date to be set by TELUS Québec, no earlier than 1 August 2002 for SmartTouch services and 1 February 2003 for residential bundles. |
The application |
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4. |
The Commission received an application from TELUS Communications (Québec) Inc. (TELUS Québec), dated 25 November 2003, for compensation for a loss of income as a result of a rate increase for optional residential services for subscribers in high cost serving areas that the company chose not to make retroactive. TELUS Québec noted that the rate increase for which the company did not charge affected SmartTouch services for the period from 1 August 2002 to 22 August 2003 and residential bundles for the period from 1 February 2003 to 22 August 2003. TELUS Québec requested compensation for this loss of income in the form of an equivalent amount from the deferral account. |
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5. |
TELUS Québec indicated that, in Decision 2002-43, the Commission made the companies' tariff rates interim as of 1 August 2002 and anticipated that the rates approved to meet the 2002 commitment regarding price caps would take effect retroactive to that date. |
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6. |
However, in a letter dated 28 July 2003 to the Commission, TELUS Québec indicated that it was concerned about the negative effects that a retroactive rate increase would have on its clients. Therefore, the company asked the Commission to use the deferral account to mitigate the negative impact while maintaining the revenue base. |
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7. |
TELUS Québec stated that, following Decision 2003-57, the company decided not to implement retroactive rate increases covering several months. TELUS Québec indicated that this decision was made to avoid penalizing consumers and to prevent a widespread negative reaction. |
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8. |
The Commission received no comments with respect to the application. |
Commission determination |
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9. |
The Commission notes that, in Decision 2003-57, it gave final approval to rate increases as of a date to be set by TELUS Québec, no earlier than 1 August 2002 for SmartTouch services and 1 February 2003 for residential bundles. The Commission notes that TELUS Québec chose not to implement the rate increases retroactively, even though Decision 2003-57 allowed it to do so. Under the circumstances, the Commission is of the view that the deferral account should not be used to compensate the company for the loss of income stemming from the fact that TELUS Québec implemented the approved rates as of 23 August 2003 rather than 1 August 2002 for SmartTouch services and 1 February 2003 for residential bundles. |
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10. |
Accordingly, the Commission denies TELUS Québec's application. |
| Secretary General | |
| This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca |
Date Modified: 2004-05-21
- Date modified: