ARCHIVED - Telecom Decision CRTC 2014-163

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Ottawa, 3 April 2014

Bell Aliant Regional Communications, Limited Partnership and Bell Canada – Forbearance from regulation of residence multi-line inside wire services

File number: 8640-A53-201313783

The Commission forbears, with some conditions and to the extent set out in this decision, from regulating Bell Aliant’s and Bell Canada’s residence multi-line inside wire services.

Introduction

1. The Commission received an application from Bell Aliant Regional Communications, Limited Partnership and Bell Canada (collectively, the Bell companies), dated 16 October 2013, requesting that the Commission forbear from regulating their residence multi-line inside wire services^{Footnote 1} in their operating territories in Ontario, Quebec, and Atlantic Canada. Specifically, the Bell companies requested that the Commission refrain from exercising its powers and performing its duties under sections 24, 25, 27, 29, and 31 of the Telecommunications Act (the Act) with regard to these services.

2. The Commission received an intervention regarding the Bell companies’ application from the Canadian Network Operators Consortium Inc. (CNOC). The public record of this proceeding, which closed on 20 November 2013, is available on the Commission’s website at www.crtc.gc.ca under “Public Proceedings” or by using the file number provided above.

Background

3. The Commission has forborne from the regulation of rates, terms, and conditions for single-line residence and business inside wire services in the operating territories of certain incumbent local exchange carriers (ILECs) based on the conditions that (i) responsibility for inside wire has been transferred to customers, (ii) customers have been adequately informed of their rights and obligations, (iii) appropriate demarcation devices^{Footnote 2} have been installed, and (iv) a competitive market has been established for inside wire services.

4. In Telecom Decision 94-19, the Commission forbore from the regulation of business multi-line inside wire services, in conjunction with forbearance for competitive multi-line and data system equipment, for the large ILECs subject to that decision.

5. In Telecom Regulatory Policy 2012-563, the Commission established a uniform policy with respect to single-line inside wire services. The Commission determined that all ILECs that have transferred responsibility for single-line inside wire to their residential and business customers are to provide free trouble diagnostic service to those customers who do not have a jack-ended demarcation device. Following an inside wire trouble diagnosis, the technician may either install a jack-ended demarcation device at no charge or repair the trouble free of charge. If a jack-ended demarcation device is installed, the customer then has the option to repair the inside wire trouble themselves, request a third party to repair it, or request the technician to complete the repair at prevailing rates.

Should the Commission forbear from regulating the Bell companies’ residence multi-line inside wire services and, if yes, to what extent?.

6. The Bell companies noted that they transferred responsibility for inside wire to their customers over 10 years ago. They added that their customers have been given the necessary information regarding inside wire and are accustomed to managing their inside wire installation, maintenance, and repair, either by themselves or through third parties such as builders, electricians, and cabling companies. They submitted that, in this regard, there is no difference between residence multi-line inside wire services and single-line inside wire services. They further submitted that while their existing residence multi-line customers continue to use their services to address inside wire issues, new customers often elect to use competitive suppliers for this purpose.

7. The Bell companies submitted that the market for residence multi-line inside wire services is well established and highly competitive, and these services remain the only regulated inside wire services in their operating territories. They argued that there are no barriers deterring competitors from entering this market, and there is no unique reason that the market should remain regulated.

8. The Bell companies stated that if forbearance were granted for their residence multi-line inside wire services, they would apply the same regulatory measures and notification requirements pertaining to diagnostic and repair services set out in Telecom Regulatory Policy 2012-563 to these services.

9. Finally, the Bell companies submitted that forbearance from the regulation of residence multi-line inside wire services would be consistent with the Policy Direction^{Footnote 3} and with paragraph 7(f) of the Act.^{Footnote 4}

10. CNOC supported the Bell companies’ application, submitting that forbearance should be granted and that the same regulatory measures set out in Telecom Regulatory Policy 2012-563 for single-line inside wire services should be applied to the Bell companies’ residence multi-line inside wire services.

Commission’s analysis and determinations

11. Subsection 34(1) of the Act provides that the Commission may refrain from regulating a service or class of services where it finds that such forbearance is consistent with the telecommunications policy objectives set out in section 7 of the Act. Subsection 34(2) of the Act requires the Commission to forbear where it finds that the market for the service or class of services in question is, or will be, subject to sufficient competition to protect the interests of users. Subsection 34(3) of the Act provides that the Commission shall not forbear if it finds that to do so would be likely to impair unduly the establishment or continuance of a competitive market for that service or class of services.

12. The Commission considers that there are no regulatory or legislative barriers to entering the residence multi-line inside wire services market in the Bell companies’ operating territories. In addition, the Commission notes that the responsibility for inside wire has been transferred to customers in the Bell companies’ operating territories and that customers have been adequately informed of their responsibility for inside wire via the Bell companies’ websites and telephone directory information.

13. The Commission considers that customers in the Bell companies’ operating territories have numerous options and alternative suppliers for residence multi-line inside wire services. As such, the Commission considers that the Bell companies lack market power in the provision of residence multi-line inside wire services throughout their operating territories.

14. In light of the above, the Commission considers that forbearance from regulation would be appropriate for residence multi-line inside wire services provided by the Bell companies.

15. Accordingly, pursuant to subsection 34(1) of the Act, the Commission finds, as a question of fact, that refraining from exercising its powers and performing its duties, to the extent set out in this decision, with respect to residence multi-line inside wire services provided by the Bell companies in their operating territories in Ontario, Quebec, and Atlantic Canada is consistent with the telecommunications policy objectives, specifically the objective set out in paragraph 7(f) of the Act.

16. In addition, pursuant to subsection 34(2) of the Act, the Commission finds as a question of fact that the Bell companies’ residence multi-line inside wire services are subject to competition sufficient to protect the interests of users and therefore should be forborne from regulation to the extent set out in this decision.

17. Pursuant to subsection 34(3) of the Act, the Commission finds as a question of fact that refraining from regulating the Bell companies’ residence multi-line inside wire services, to the extent set out in this decision, is unlikely to impair unduly the continuance of a competitive market for these services.

Extent of forbearance

18. In light of the above findings, the Commission must determine the extent to which it is appropriate to refrain, in whole or in part and conditionally or unconditionally, from the exercise of any power or the performance of any duty under sections 24, 25, 27, 29, and 31 of the Act.

Section 24

19. The Commission considers that it is appropriate to retain its powers to impose conditions, pursuant to section 24 of the Act, so as to ensure that the confidentiality of customer information continues to be protected. The Commission notes that the Bell companies’ Terms of Service, which ensure the confidentiality of customer information for regulated services, do not apply to forborne services. This being the case, the Commission directs the Bell companies, as a condition of providing residence multi-line inside wire services, to abide by the existing conditions regarding disclosure of confidential customer information to third parties with respect to these services.

20. The Commission also directs the Bell companies, on a going-forward basis and as a condition of providing residence multi-line inside wire services, to incorporate, where appropriate, the existing conditions regarding disclosure of confidential customer information to third parties into all contracts and any other arrangements for these services.

21. The Commission also considers that, as ILECs that have transferred responsibility for inside wire to their customers, the Bell companies should continue to be subject to regulatory measures with respect to their residence multi-line inside wire services. Consequently, the Commission directs the Bell companies, as a condition of providing these services, to abide by the regulatory measures set out in Telecom Regulatory Policy 2012-563.

22. The Commission further considers that it is appropriate for it to retain sufficient powers under section 24 of the Act to specify possible future conditions with respect to residence multi-line inside wire services in the operating territories of the Bell companies, should it prove appropriate to do so.

Section 25

23. In light of its finding that the Bell companies do not have market power with respect to residence multi-line inside wire services, the Commission considers that requiring the Bell companies to obtain prior Commission approval for rates, terms, and conditions for these services would not represent efficient and effective regulation. Accordingly, the Commission considers that it would be appropriate to refrain from the exercise of all its powers and the performance of all its duties under section 25 of the Act with respect to these services.

Section 27

24. The Commission notes that subsections 27(2) and (4) of the Act relate to unjust discrimination and undue or unreasonable preference or disadvantage. The Commission considers that it would be inappropriate to refrain from exercising its powers or performing its duties under these provisions in respect of the Bell companies’ residence multi-line inside wire services, in order to allow the Commission to address any potential complaints that may arise regarding these services.

25. The Commission also considers it necessary to retain its powers under subsection 27(3) of the Act with respect to compliance with the powers and duties from which it has not forborne in this decision.

26. Accordingly, the Commission considers it necessary to retain its powers and to perform its duties under subsections 27(2), (3), and (4) of the Act with respect to the Bell companies’ residence multi-line inside wire services. The Commission will, however, refrain from the exercise of all its powers and the performance of all its duties under subsections 27(1), (5), and (6) of the Act as they relate to the determination of just and reasonable rates with respect to these services.

Sections 29 and 31

27. The Commission considers it appropriate that the Bell companies no longer be required to obtain prior Commission approval to enter into agreements or arrangements with other telecommunications common carriers regarding residence multi-line inside wire services. Accordingly, the Commission will refrain from the exercise of all its powers and the performance of all its duties under section 29 of the Act with respect to these services.

28. The Commission also considers it appropriate that the Bell companies be able to limit their liability regarding residence multi-line inside wire services in the same way as an unregulated service provider. Accordingly, the Commission will refrain from the exercise of all its powers and the performance of all its duties under section 31 of the Act with respect to these services.

Declaration of forbearance

29. In light of all the above, the Commission declares, pursuant to subsection 34(4) of the Act, that sections 24, 25, 27, 29, and 31 of the Act do not apply to the Bell companies’ residence multi-line inside wire services, except with respect to

• the conditions set out in this decision pursuant to section 24 of the Act, including the regulatory measures set out in Telecom Regulatory Policy 2012-563;
• any future condition that the Commission may impose, pursuant to section 24 of the Act;
•  the Commission’s powers under subsections 27(2) and (4) of the Act with respect to residence multi-line inside wire services to guard against possible unjust discrimination, undue or unreasonable preference, or undue or unreasonable disadvantage; and
•  the Commission’s powers under subsection 27(3) of the Act with respect to powers and duties not forborne.

30. The Commission directs the Bell companies to inform affected customers of their rights and responsibilities pertaining to residence multi-line inside wire services via a bill message and to provide customers with directions on how to access additional information, including wiring guides, on the Bell companies’ websites.

31. Finally, the Commission directs the Bell companies to issue revised tariff pages^{Footnote 5} that reflect the determinations in this decision by 2 May 2014.

32. Forbearance takes effect on the date of this decision.

Policy Direction

33. The Commission considers that the determinations made in this decision are consistent with the Policy Direction for the reasons set out below.

34. The Policy Direction requires, among other things, that the Commission rely on market forces to the maximum extent feasible as the means of achieving the Canadian telecommunications policy objectives. The Commission considers that forbearance from the regulation of residence multi-line inside wire services, as set out in this decision, would be consistent with subparagraphs 1(a)(i) and (ii), and 1(b)(i) and (ii), of the Policy Direction.

35. Consistent with subparagraph 1(a)(i)^{Footnote 6} of the Policy Direction, where the Commission has maintained regulation of the Bell companies’ services in this decision, it has done so because market forces alone cannot be relied upon to achieve the telecommunications policy objectives set out in section 7 of the Act.

36. Consistent with subparagraph 1(a)(ii)^{Footnote 7} of the Policy Direction, the Commission considers that the regulatory measures approved in this decision are efficient and proportionate to their purpose, and interfere minimally with market forces.

37. Consistent with subparagraph 1(b)(i)^{Footnote 8} of the Policy Direction, the Commission considers that its determinations to maintain regulatory measures in this decision advance the telecommunications policy objective set out in paragraph 7(f) of the Act.

38. Consistent with subparagraph 1(b)(ii)^{Footnote 9} of the Policy Direction, the Commission considers that its determinations in this decision neither deter economically efficient competitive entry into the above-noted markets nor promote economically inefficient entry.

Secretary General

Related documents

• Bell Aliant Regional Communications, Limited Partnership and Bell Canada – Application to review and vary Telecom Regulatory Policy 2012-83 regarding the regulatory measure associated with single-line inside wire services, Telecom Regulatory Policy CRTC 2012-563, 15 October 2012
• Review of regulatory framework, Telecom Decision CRTC 94-19, 16 September 1994

Date modified:

2014-04-03