ARCHIVED - Telecom Commission Letter - 8652-C12-200312265

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Ottawa, 13 June 2005

File No. 8652-C12-200312265

BY E-MAIL

To: Attached Distribution List

RE: Revised Imputation test Guidelines for Type 1 and 2 CSAs

As a result of Review of price floor safeguards for retail tariffed services and related issues , Telecom Decision CRTC 2005-27, 29 April 2005 (Decision 2005-27), please find attached the revised version of the imputation test guidelines that each incumbent local exchange carrier (ILEC) is required to provide in support of Type 1 or Type 2 customer-specific arrangement (CSA) applications. It is noted that these revised guidelines are consistent with the costing methodology directives of Review of Bell Canada 's customer-specific arrangements filed pursuant to Telecom Decision CRTC 2002-76 , Telecom Decision CRTC 2003-63, 23 September 2003 , and the confidential Commission staff letter to Bell Canada dated 18 July 2003 .

It is noted that, as a result of Decision 2005-27, for the purpose of Type 2 CSA imputation tests, Category I and Category II Competitor services are to be costed by imputing the applicable tariffed rates. It is further noted that in the event such costs cannot be easily separated and calculated on this basis, proxy cost estimates for Category I and II service functionalities/components may be used by applying a margin of 15% to the Phase II costs of Category I service functionalities/components and a margin of 25% to the Phase II costs of Category II service functionalities/components.

It is further noted that if the ILEC amends a previously-approved contract without providing an imputation test, the ILEC is to provide the necessary justification in its covering letter (e.g., implicit/explicit CSA rate increase, or implicit/explicit CSA rate reduction where the total annualized CSA revenues relative to the previous imputation test are reduced by less than 2%, or less than 5% if the previous imputation test had a mark-up of 10% or more).

Yours sincerely,

Original signed by Yvan Davidson

Yvan Davidson
Senior Manager, Competitor Services & Costing

cc: Parties to Public Notice 2003-10
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