ARCHIVED - Telecom - Commission Letter - 8622-M56-200303149 - François Ménard's Part VII Application against Bell Canada and TELUS Communications Inc. for the provision of Metropolitan Ethernet over optical fibre and of digital line services

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Ottawa, 10 February 2005


Our File No.: 8622-M56-200303149

Mr. François Ménard
P.O. Box 203
Pointe du Lac, QC   G0X 1Z0

Mr. Mirko Bibic
Chief, Regulatory Affairs
Bell Canada
105 Hôtel-de-Ville, 6 th floor
Gatineau , QC   J8X 4H7

Mr. Willie Grieve
Vice President, Telecom Policy & Regulatory Affairs
TELUS Corporation
Floor 31, 10020 100 Street NW
Edmonton , AB   T5J 0N5

Re: François Ménard's Part VII Application against Bell Canada and TELUS Communications Inc. for the provision of Metropolitan Ethernet over optical fibre and of digital line services

This is in response to your Part VII application filed 6 March 2003, requesting that the Commission end the interplay of Bell Canada, Bell Nexxia,   TELUS Communications Inc. (TCI), TELUS Services Inc. (TSI) and TELUS Mobility in order to re-establish competitive equity in the provision of metropolitan Ethernet on optical fibre and digital line services.

At paragraphs 30 to 35 of your letter, you requested that the Commission: 

a) Initiate a proceeding to increase rates of metropolitan Ethernet or digital line services provided by TCI, TSI, TELE-MOBILE, Bell Canada , Bell Nexxia and/or all their subsidiaries, affiliates and/or other Canadian carriers under their control, to a minimum level higher than any arrangement available under an approved tariff: 

b) Require incumbent carriers providing services pursuant to Forbearance from retail internet services , Telecom Order CRTC 99-592, 25 June 1999 (Order 99-592), and Forbearance granted to telcos' wide area network services , Order CRTC 2000-553, 16 June 2000 (Order 2000-553), to file tariffs and imputation tests where the services have likely been packaged on the basis of a sub-infrastructure for which a tariff has been filed and approved; 

c) Allow competitors to seek a retroactive increase in rates, for Ethernet circuits or business and residential business digital lines, for past unsuccessful attempts to provide such a circuit; 

d) Compel TCI and Bell Canada to file a general tariff for metropolitan Ethernet and digital line services which can be packaged with certain TCI and Bell Canada tariffed and proposed tariffed services; 

e) Modify the affiliate rule established in Regulatory safeguards with respect to incumbent affiliates, bundling by Bell Canada and related matters , Telecom Decision CRTC 2002-76, 12 December 2002 (Decision 2002-76) as well as Order 99-592, Order 2000-553 and Bundling framework developed for customer-specific arrangements , Order CRTC 2000-425, 19 May 2000 (Order 2000-425), to prevent TCI and Bell Canada to circumvent the intent of the regulatory process; and 

f) Order Bell Canada, Bell Nexxia, TCI and TSI to immediately account for all other telecommunications services that they provide without a tariff pursuant to Forbearance - Services provided by non-dominant canadian carriers , Telecom Decision CRTC 95-19, 8 September 1995, Order 99-592 or Order 2000-553.

In response to your requested relief with respect to the bundling and the pricing of services, in Amendments to Telecom Public Notice CRTC 2003-8, Review of price floor safeguards for retail tariffed services and related issues , Telecom Public Notice CRTC 2003-10, 8 December 2003 (Public Notice 2003-10), the Commission, among other issues, expressed preliminary views regarding modifications to the existing pricing and bundling rules. The Commission is also examining whether the existing pricing and bundling rules should be modified and, if so, what changes should be made.

In response to your requested relief with respect to affiliate rules, in Decision 2002-76, for the purpose of the affiliate rule, the Commission changed the definition of "affiliate" to include only those persons that are not Canadian carriers and that control or are controlled by the ILEC or that are controlled by a person that also controls the ILEC. The Commission added that in all cases, control means direct or indirect control in fact. The Commission has also changed the conditions under which an ILEC may provide tariffed services to an affiliate to prevent ILECs from circumventing the regulatory framework.

Furthermore, in Follow-up to Telecom Decision 2002-76 - Location of the CSG and regulatory safeguards for affiliated carriers , Telecom Decision CRTC 2004-50, 22 July 2004 (Decision 2004-50), the Commission placed additional regulatory safeguards in place by confirming that an affiliated carrier will be required to comply with section 25 and other applicable provisions of the Act whenever the affiliated ILEC would be required to do so. Also, when examining a proposed tariff by an affiliated carrier, the Commission noted that it will apply the same criteria with respect to the imputation test and the bundling rules, as it would apply if the tariff were filed by an affiliated ILEC.

With respect to your requested relief for Ethernet services, in Ethernet services , Telecom Decision CRTC 2004-5, 27 January 2004 (Decision 2004-5), the Commission approved, on an interim basis, the introduction of Ethernet access services by Bell Canada . The Commission also noted that Ethernet service was a relatively recent addition to the ILECs' service offerings and considered that Ethernet service was also an important addition to the service offerings of many competitors. Until the Commission reached its determinations regarding the adequacy of Ethernet substitutes and related matters, the Commission found it appropriate to put in place interim Ethernet services for competitor use to provide competitors with the opportunity to mitigate any harmful effects they may experience in the meantime. To that effect, the Commission, among other measures, classified: 

•  The Ethernet CO connecting link service as a Category I Competitor Services; and

•  The Ethernet interface service as a Category II Competitor Services;

The concerns you raised in your application and the relief requested largely relate to issues that have already been addressed by the Commission in Decision 2002-76, Decision 2004-50, and Decision 2004-5, or that are being addressed in the proceeding initiated by Public Notice 2003-10. Moreover, you did not demonstrate that the existing Commission regulatory frameworks and decisions, namely Decision 2002-76 and Orders 99-592, 2000-425 and 2000-553, should be modified as you requested.

Accordingly, staff considers that no further action is required and is closing this file with respect to this matter.

Yours sincerely,


Scott Hutton
Director General, Competition, Costing and Tariffs

Date modified: 2005-02-10

Date modified: