Supreme Court grants leave to appeal deferral accounts

Canada's highest court has given Bell Canada, Telus Corp. and consumer groups the green light to appeal the CRTC's ruling on deferral accounts in a decision announced on September 25. It's not yet clear when the Supreme Court of Canada will hear the case."We are very happy about that because we think the Federal Court erred in its judgement and there are a broad number of legal issues in that appeal that need to be clarified," Mirko Bibic, chief of regulatory affairs at Bell Canada, tells Network Letter.Bell's main argument is that the CRTC doesn't have the power to order rate rebates on prices that had previously been deemed just and reasonable. In essence, according to Bibic, the commission is forcing the ILECs to lower rates retroactively, something it's not allowed to do."That's a fundamental position and of course in denying our appeal the federal court also made some pronouncements about the powers that the commission has under sections 27 and section 7 of the , an interpretation in our view which amplified the commission's powers beyond what is contemplated," Bibic explains.While Bell is seeking to overturn the rate rebates ordered by the commission, the consumers groups will argue for an elimination of the incumbent phone companies' broadband expansion plans. The Consumers Association of Canada, the National Anti-Poverty Association and the Public Interest Advocacy Centre argue that the CRTC-ordered rebates could only be given to people who contributed to the deferral accounts, namely urban telephone subscribers.At the heart of the deferral accounts controversy is $650 million that was accumulated after urban subscribers were overcharged by the ILECs in the wake of the 2002 price cap decision. The commission decided the money should be used to expand broadband in rural and remote regions of the country, with 5% of the total going to address disability issues. The remaining amount was to go back to subscribers.While a Supreme Court hearing on the matter is likely months away, ILEC broadband expansion plans, while approved, sit idle.For additional background on this issue, refer to Bell appealing deferral account ruling to Supreme Court on March 20, 2008 and the March 28, 2008 article, Bell Canada prepares for Supreme Court battle to keep customer rebates.

Supreme Court grants leave to appeal deferral accounts

News | September 29, 2008

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