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ARCHIVED - Telecom Order CRTC 2004-255

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Telecom Order CRTC 2004-255

  Ottawa, 29 July 2004
 

TELUS Communications (Québec) Inc.

  Reference: Tariff Notices 367 and 367A
 

2003 Annual price cap filing

1.

In Implementation of price regulation for Télébec and TELUS Québec, Telecom Decision CRTC 2002-43, 31 July 2002 (Decision 2002-43), the Commission established the price cap regime that is now applicable to Société en commandite Télébec and TELUS Communications (Québec) Inc. (TELUS Québec).

2.

The Commission received an application by TELUS Québec, dated 5 December 2003 and amended 30 June 2004, proposing revisions to meet its 2003 price cap commitment.
 

Application

3.

In its application, TELUS Québec proposed revisions to the following General Tariff items:
 
  • item 2.04, Shared Use;
 
  • item 2.05, Directory Listings;
 
  • item 2.09, Semi-Public Telephone Service;
 
  • item 2.17, Direct Inward Dialing;
 
  • item 5.01, Digital Network Services; and
 
  • item 5.05, Integrated Services Digital Network - Primary Rate Interface (ISDN-PRI) Service.

4.

In particular, TELUS Québec proposed the following tariff revisions to services in the other capped services basket:
 
  • decrease the monthly rate for additional business listings by 3.8%;
 
  • decrease the monthly rates for direct inward dialing by amounts ranging from 13.4% to 16.0%;
 
  • decrease the monthly rates for various components of high capacity digital network service by amounts ranging from 9.2% to 18.6%; and
 
  • decrease the monthly rates for various components of ISDN-PRI by 9.2%.

5.

TELUS Québec also proposed wording changes to its shared use service and its semi-public telephone service, in order to clarify that the rates for these services would be correlated to the monthly non-contracted rates of its single business local exchange service.

6.

TELUS Québec filed cost information in support of its proposed rate reductions to additional business listings, direct inward dialing, high capacity digital network service and ISDN-PRI service.

7.

TELUS Québec indicated that the proposed tariff revisions would ensure that the service basket index (SBI) would not exceed the service basket limit (SBL) for the other capped services basket.

8.

TELUS Québec requested that the proposed tariff revisions become effective on 1 August 2003.

9.

TELUS Québec also indicated that the proposed tariff revisions complied with all the pricing constraints set out in Decision 2002-43 and would ensure that it met its price cap obligations for 2003.
 

Commission analysis and determination

 

Costing issues

10.

In Société en commandite Télébec and TELUS Communications (Québec) Inc. 2002 annual price cap filings, Telecom Decision CRTC 2003-57, 22 August 2003, the Commission concluded that TELUS Québec should file cost studies and imputation test results or alternate costing support, whichever was appropriate depending on the type of service, when filing tariff applications to introduce a new service or to propose implicit or explicit rate reductions to an existing service.

11.

The Commission is satisfied that TELUS Québec's cost information, filed with its application, demonstrates that the proposed rates exceed their associated costs.
 

Compliance with pricing constraints set out in Decision 2002-43

12.

In Decision 2002-43, the Commission applied a number of basket and rate element constraints to services in certain service baskets, in order to provide customers of those services with price protection. The pricing constraints that apply to services in the other capped services basket include:
 
  • a basket constraint, operating through the SBL for that basket, which must be updated annually by the rate of inflation less the productivity offset;
 
  • a rate element constraint limiting rate increases for a service to 10% per year; and
 
  • a provision, in order to prevent an incumbent local exchange carrier from decreasing rates in more competitive areas and increasing rates in less competitive areas of the same band, that the rates for other capped services should not generally be permitted to be further de-averaged within a band.

13.

The Commission notes that TELUS Québec's proposed tariff revisions would ensure that the SBI would not exceed the SBL for the other capped services basket. As TELUS Québec proposed no rate increases, the rate element constraint limiting rate increases to 10% per year is not pertinent.

14.

The Commission also finds that the proposed tariff revisions would not further de-average the rates for other capped services within a band.

15.

Consequently, the Commission finds that the proposed tariff revisions are in compliance with the Commission's determinations in Decision 2002-43.

16.

The Commission also finds that the proposed wording changes clarify the tariff.

17.

The Commission notes that TELUS Québec's rates in its other capped services basket are currently interim. The Commission also notes that, in a Commission staff letter dated 4 June 2004, TELUS Québec's deadline for filing its 2004 price cap filing was extended to 31 July 2004. The Commission notes that a decision on any rate adjustment proposed as part of TELUS Québec's 2004 price cap filing could not be issued prior to 1 August 2004, the start date of the 2004 price cap period. As a result, rates in the other capped services basket must remain interim in order for TELUS Québec to apply the basket constraint equal to inflation less productivity, for the 2004 price cap period, to this basket of services.

18.

In light of the foregoing, the Commission approves on an interim basis TELUS Québec's application. The revisions take effect as of 1 August 2003.
  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: 2004-07-29

Date modified: