MTS Allstream awarded nearly $10 million from CRTC

Manitoba ILEC MTS Allstream Inc. has won an appeal of a CRTC decision, giving the company a $9.8 million windfall. The following is an edited excerpt of the commission’s Telecom Decision 2006-20. MTS Allstream noted in its submissions that there was substantial doubt as to the correctness of Decision 2005-52 because the commission had failed to apply the proper legal tests with respect to the denial of relief due to delay and conduct. With respect to the matter of delay, the commission disagrees with MTS Allstream’s contention that, if its request for subsidy for the relevant period had been granted in Decision 2005-52, no other person would have been affected. The commission therefore considers that the jurisprudence MTS Allstream relied on is distinguishable on this ground. With respect to the matter of MTS Allstream’s conduct, the commission notes that MTS Allstream’s argument was specifically premised on the proposition that, as a matter of law, the company was otherwise entitled to the relief sought. By contrast, the commission considers that MTS Allstream has not demonstrated that the commission was legally obliged to grant the relief sought in the proceeding that led to Decision 2005-52. For example, the commission is not persuaded by MTS Allstream’s submission that the commission’s treatment in Decision 2005-52 of the company’s delay constituted an error of law. The commission notes MTS Allstream’s submission that there was substantial doubt as to the correctness of Decision 2005-52 having regard to the manner in which the commission weighed the public interest in the finality of the commission’s decisions against the policy objective of rendering telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada. The commission further notes MTS Allstream’s submission that there was also substantial doubt as to the correctness of Decision 2005-52 because denial of the requested subsidy was disproportionate to the nature of MTS Allstream’s mistake related to its original classification of the exchanges in question. The commission has reviewed the appropriateness of the weight to be attached to the policy considerations relevant to the disposition of MTS Allstream’s request for subsidy during the relevant period in Decision 2005-52. The commission notes that it is clear the company provided service to its residential customers in Band F during the relevant period. The commission finds that, in providing this service, MTS Allstream contributed to the achievement of the policy objective in section 7(b) of the Act: namely, to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada. The commission further notes that MTS Allstream provided the residential service in question at retail rates that were significantly less than cost. The commission finds that, like other ILECs that received subsidy for the provision of service in their high-cost bands during the relevant period, MTS Allstream would have received the subsidy it has now requested if it had correctly assigned its exchanges to Band F in 2001. The commission considers that the error that led to MTS Allstream’s original mis-assignment of exchanges was an honest mistake made during the implementation period of a new subsidy regime. The commission considers further that its denial of the subsidy in Decision 2005-52 was disproportionate to this mistake.

MTS Allstream awarded nearly $10 million from CRTC

News | April 27, 2006

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