ARCHIVED -  Telecom Order CRTC 98-462

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Telecom Order

Ottawa, 12 May 1998
Telecom Order CRTC 98-462
By two letters dated 8 August 1997, 1214620 Ontario Ltd., operating as Telephone Savings Network Ltd. (TSN), requested an exemption from contribution charges with respect to Centrex systems. TSN included two affidavits with its application. One of the affidavits, dated 12 February 1997, affirmed that Centrex systems in the 905, 416, 519 and 613 area codes are used solely for local or single-hop calling. The other affidavit, dated 8 August 1997, affirmed that Centrex systems in the 519-254 and 519-948 exchanges are used solely for administrative purposes.
File No.: 8626-08-02/97
1. By letter dated 27 November 1997, Bell Canada (Bell) noted that with respect to the affidavit for the Centrex systems used for local or single-hop calling, TSN had not identified which systems are the subject of its request. However, Bell stated that its records indicate that TSN has Centrex systems in place in the 519, 905 and 416 areas which may be used for resale purposes. In light of this, Bell submitted that TSN should be required to provide a revised affidavit specifying which systems are the subject of its application.
2. Bell noted TSN's request that its exemption with respect to these systems be made effective the date of installation and TSN's indication that initial installations were completed 5 August 1997. Bell stated that since this date precedes TSN's application by only 3 days, it had no objection if an exemption is granted effective 5 August 1997.
3. Bell understood that the two systems used for administrative purposes are also used for resale purposes. Accordingly, Bell submitted that TSN should be required to provide further clarification regarding the use of these systems.
4. Bell also noted that pursuant to the Commission's determination in Telecom Order CRTC 97-590 dated 1 May 1997, administrative systems will attract contribution charges effective 1 January 1998. In light of this, Bell also submitted that, should the Commission approve a contribution exemption for TSN's administrative circuits, the effective date for this exemption will terminate as of 31 December 1997 unless TSN can provide additional evidence to substantiate an exemption after that time.
5. By letter dated 27 January 1998, TSN submitted two revised affidavits. TSN stated that by Articles of Amendment, dated 9 June 1997, 1214620 Ontario Ltd. had changed its name to Telephone Savings Network Ltd. TSN stated that the revised affidavits reflect this change.
6. TSN stated that one affidavit is for Centrex systems used solely to provide local services to its customers. TSN stated that this affidavit satisfies the evidentiary requirement the Commission determined to be appropriate in Telecom Order CRTC 97-1555 dated 23 October 1997 (Order 97-1555) with respect to AT&T Canada Long Distance Services Company's application regarding circuits used to provide local services. TSN stated that its affidavit addressed all of its resale activity on its Centrex systems.
7. TSN stated that the second affidavit deals with the only exception to the first affidavit, that of administrative circuits. TSN stated that it is the end-user of the circuits identified in this affidavit. TSN stated that as of the date of its submission, these circuits were associated with a Centrex system which includes Centrex circuits used for local resale. TSN stated that an order had been submitted by TSN and processed by Bell, to separate the administrative circuits from those used for resale purposes.
8. TSN submitted that it is strictly a rebiller of long distance. TSN stated that all administrative circuits are purchased from a long distance provider, and thus do not, in its submission, attract contribution payable directly by TSN.
9. By letter dated 2 March 1998, Bell submitted that a complete list of which Centrex systems are the subject of TSN's application is required so that the Commission and Bell can identify which systems require an exemption. Bell submitted that its records indicate that TSN has Centrex systems in place in numerous exchanges throughout Ontario which may be used for resale purposes. In light of this, Bell submitted that TSN should be required to provide a revised affidavit specifying which systems are the subject of its application.
10. Bell agreed with TSN that the administrative circuits identified by TSN were being used for administrative traffic.
11. However, Bell noted that the affidavit provided by TSN fails to confirm that this administrative system is not connected directly to local or interexchange private line facilities or used for multiple-hop administrative calls. In light of this, Bell recommended that the Commission grant interim approval to this request effective the date of reconfiguration, 18 February 1998. Bell submitted that such approval should be subject to the receipt of a revised affidavit affirming that the Centrex system does not connect to local or interexchange private line facilities and is not used to route multiple-hop administrative calls.
12. By letter dated 13 March 1998, TSN provided an Attachment A (filed in confidence with an abridged version for the public record) which listed all Centrex systems covered by its 27 January 1998 affidavit. TSN noted that these systems are used "solely for local calling" as indicated in the affidavit, not for "local or single hop calling" as indicated in Bell's comments of 2 March 1998.
13. TSN stated that with respect to the administrative system, it had attached a revised affidavit to address the issue identified in Bell's comments of 2 March 1998.
14. TSN noted Bell's suggestion that interim approval be granted for the administrative circuits with an effective date based on the separation of the administrative Centrex system. TSN stated that the reason for separating the systems in the 519-254 exchange was for purposes other than contribution exemption. TSN submitted that the eligibility of these circuits for contribution does not depend on whether they were in a separate system or not. TSN requested that the contribution exemption for the administrative system have an effective date of the date of installation.
15. Consistent with Order 97-1555, the Commission agrees with TSN that the appropriate evidentiary requirement to support a contribution exemption for local services in this case is a single affidavit. The Commission considers that TSN's revised affidavit satisfies this requirement. The Commission also considers that the company's second revised affidavit for administrative services meets the Commission's evidentiary requirements to support a contribution exemption. The Commission notes that this affidavit affirmed, among other things, that TSN's administrative system is not connected directly to local or interexchange private line facilities and is not used to route multiple-hop administrative calls.
16. In light of the foregoing, TSN's application is approved effective the date of installation.
Laura M. Talbot-Allan
Secretary General
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