CRTC takes Bell Canada to task for violations of bundling regulations

For the second time this month, the CRTC has slapped Canada’s largest ILEC on the wrists for contravening commission guidelines. In a December 12 decision, the regulator ruled that Bell Canada violated bundling rules by transferring work to an affiliated company. Telecom Decision 2002-76 is the result of a Part VII application filed at the beginning of the year by GT Group Telecom Services Corp. Group Telecom alleged that Bell should not have transferred work to Bell Nexxia without having it fall under tariff requirements. In 1992, as part of the opening up of the LD market, the CRTC ordered incumbents to set up carrier services groups (CSGs) to protect against anti-competitive behaviour when dealing with new entrants. No similar provision was established when competitive local service was initiated. By 2001, Bell had shifted its CSG to Nexxia. That meant all competitors had to deal with Nexxia instead of Bell Canada for services. But Nexxia does not route its own requests for Bell Canada services through the CSG. It deals directly with the telco. Group Telecom raised concerns that by sharing information between the two BCE Inc. subsidiaries, the companies were improperly handling confidential competitor data. The CLEC also worried that because Nexxia did not have to go through the CSG to get Bell Canada service, it had an unfair advantage over other firms. Bell, in its defence, said it did not need CRTC approval to transfer the CSG. It denied there was any discrimination or anti-competitive behaviour and accused Group Telecom and the telcos who backed it of relying on hypothetical examples. The regulator sided with the competitors. It found the transfer to be a violation of Decision 97-6 on unbundled rates to provide equal access. "In the commission’s view, an ILEC should be directly responsible for the protection of confidential information relating to the use of ILEC tariffed services by competitors," the CRTC’s ruling states. "It is not appropriate for the ILEC to delegate this role to an affiliate." It ordered the CSG to be moved back to Bell Canada by next February and that no workers at any BCE affiliate have any responsibility for the CSG operations. A revised CSG for Bell Canada and Bell Nexxia must be filed by January 27. There is no indication that any other ILEC has acted as Bell has. Nevertheless, the commission has directed Aliant Telecom Inc., Manitoba Telecom Services Inc., SaskTel, Télébec, Telus Corp. and Telus Québec to confirm this and to show why the affiliate rules for Bell should not apply to them also. Group Telecom also questioned sales and marketing activities involving Bell Canada and Bell Nexxia. During the price cap proceeding, Thomas Gillette testified on Bell’s behalf that Nexxia was generally acting as an agent of the telco not as a reseller. That was rejected by the CRTC. "The commission notes that tariffs have not been filed by Bell Canada with respect to any of the 203 contracts that were identified by Bell Canada in the Public Notice 2001-37 proceeding," the decision states. "Given the commission’s determination that at least 111 of these contracts involved bundling of tariffed services by Bell Canada, including the two contracts where it was claimed that Bell Nexxia was acting as a reseller, the commission finds that Bell Canada is non-compliant for each such bundle." The CRTC ordered Bell to file tariffs for the disputed contracts by January 27. It wants Bell and the other ILECs to notify customers that bundling provisions are subject to CRTC approval. Earlier this month, the CRTC slapped Bell on the wrists for violating winback rules (NL Update, Dec. 9/02). In both cases, the commission issued a rare news release announcing its decision.

CRTC takes Bell Canada to task for violations of bundling regulations

News | 12/16/2002 5:00 am EST

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