This is the second part of the Consultative Document on Oftel's proposals for new interconnection charging arrangements from August 1997. It contains the four annexes (A-D), including draft licence modifications and draft guidelines on the operation of the network charge controls, referred to in the main document. Copies of the main document are available from Oftel's Press Office (tel: 0171 634 8754) or Library (fax: 0171 634 8946).
Annex A Draft modifications to BT's licence
Annex B Guidelines on the operation of the network charge controls
Annex C Standard services in the new regime of network controls
Annex D Financial model development
Click here to go to main document
Note: These modifications have not yet been finalised because the consultation is itself not finalised. In addition, the drafting may not fully reflect the policy discussion in this Document. The provisions in italics have been added or changed since draft 2 published in December 1996. Dots (to the extent reasonably possible) mark deletions. The provisions in square brackets are those which require further policy consideration or to be defined.
1. Subject to paragraph 2 below, with effect from 1 October 1997, for Condition 13 shall be substituted the following Condition, and Conditions 16A, 16B and 46 shall be deleted:
"CONNECTION OF NETWORKS AND THE PROVISION OF STANDARD SERVICES FOR CONNECTION SERVICES
Interconnection Agreements
13.1 Without prejudice to Condition 3 and subject to the provisions of this Condition, the Licensee shall, unless it is impracticable to do so, offer to enter into an agreement with the Operator ... or offer to amend such an agreement, as the case may be, within a reasonable period ..., if an Operator requires it to do so:
(a) to connect, and keep connected, to any of the Applicable Systems, or to permit to be so connected and kept connected, the Operator's Relevant Connectable System and accordingly to establish and maintain such one or more points of connection as are reasonably required and are of sufficient capacity and in sufficient number to enable Messages conveyed or to be conveyed by means of the Operator's system to be conveyed by means of any of the Applicable Systems in such a way as conveniently to meet all reasonable demands for the conveyance of Messages between the Relevant Connectable System and any of the Applicable Systems; and
...
(b) to provide such other telecommunication services (including the conveyance of Messages which have been, or are to be, transmitted or received at such points of connection), information and other services which, to the extent the parties cannot agree or the Licensee is not in any event so required under or by virtue of another Condition of this Licence, the Director may determine are reasonably required (but no more than reasonably required) to secure that points of connection are established and maintained and to enable the Operator effectively to provide the Connection Services which it provides or proposes to provide.
...
13.2 Without prejudice to Conditions 1 and 46A or the requirement for connection under paragraph 13.1(a), unless such Circuits are required for the establishment and maintainance of points of connection under paragraph 13.1(a), the Licensee shall not be obliged under paragraph 13.1 to offer to provide Private Circuit (defined in Part 1) or International Private Circuit (defined in Condition 24B) telecommunication services, or partial Circuit services.
13.3 The Licensee shall secure that an agreement to be entered into, or an amendment, under paragraph 13.1 ... is offered on terms and conditions which are ... reasonable. To the extent that the terms and conditions of an agreement made under paragraph 13.1 (whether before, on or after 1 October 1997) cease to be reasonable, the Licensee shall, within a reasonable period, offer to the Operator, or agree with the Operator, as the case may be, to amend the agreement in terms which cause the terms and conditions of the agreement to be ... reasonable.
...
13.4 ... The Licensee shall secure and shall be able to demonstrate to the satisfaction of the Director that the charges offered, payable or proposed to be offered or payable by an Operator to the Licensee for each Standard Service are ... reasonably derived from the costs of providing the Service based on a forward looking incremental cost approach and built up from the amounts applied to the relevant Network Components or Network Parts.
...
[13.5 The Licensee shall, subject to the ability of an Operator to whom an offer is made pursuant to paragraph 13.6 to decline that offer, secure that:
(a) each Standard Service is provided to all Operators on the same charges, terms and conditions;
(b) where a Network Component or combination of Network Components is provided by the Licensee from one Business to another Business, the unit cost charged by way of Transfer Charge in respect of that provision is equal to the amount applied to that Network Component or combination of Network Components in the charge payable by an Operator to the Licensee for a Conveyance Standard Service which the Licensee is required to include in the Standard List in accordance with paragraph 13.16; and
(c) where a Network Part or combination of Network Parts is provided by the Licensee from one Business to another Business, the unit cost charged by way of Transfer Charge in respect of that provision is equal to the amount applied to that Network Part or combination of Network Parts in the charge payable by an Operator to the Licensee for a Non-conveyance Standard Service which the Licensee is required to include in the Standard List in accordance with paragraph 13.16.]
[13.6 (a) Subject to sub-paragraph (b) and notwithstanding paragraph 6 of Part 1 of Schedule 1, the Licensee shall offer to include in each agreement between the Licensee and an Operator under Condition 13.1, whether made before, on or after 1 October 1997, an obligation on the Licensee to offer to provide that Standard Service at the relevant charge and terms and conditions [published from time to time under paragraph 13.16] or the charge which the Licensee is obliged to apply as a result of the operation of Condition 24F. If the agreement provides for the provision by the Licensee to the Operator of more than one Standard Service, then the offer shall be made in respect of all the Standard Services for which that agreement provides and the Licensee shall not be in breach of this paragraph if the Operator declines to accept the offer in whole or in part.
(b) ... Without prejudice to any other Condition, an offer for the purposes of sub-paragraph (a) shall not be conditional on the acceptance by the Operator of the inclusion in the agreement of any other terms and conditions...]
13.7 The Licensee shall secure that agreements made under paragraph 13.1 are so far as circumstances allow in as similar a form as practicable notwithstanding the variety of Operators entitled to such agreements.
13.8 Where the Director so directs the Crown shall be treated for the purposes of this Condition as a person authorised to run a Relevant Connectable System ...
13.9 When an Operator's Licence has been modified to delete the Director's powers of determination and references to fully allocated costs from the condition governing the connection of Relevant Connectable Systems, any question arising under or by virtue of this Condition as to whether any terms or conditions (including charges) for the provision of services by the Operator to the Licensee (or for the provision of services for which the Licensee should reasonably pay a charge) (including the conveyance of Messages over the Operator's system) are reasonable shall be decided by the Director with reference to the provisions of the Operator's Licence .
13.10 Within a reasonable period from the date on which any Operator's Licence has been modified as described in paragraph 13.9, the Licensee shall offer to include in the agreement with the Operator under paragraph 13.1 (whether made before, on or after 1 October 1997) provision that any terms or conditions concerning the provision of services by the Operator to the Licensee (or for the provision of which the Licensee should reasonably pay a charge) will from 1 October 1997 be governed by the relevant terms of the Operator's Licence.
13.11 An agreement made pursuant to this Condition shall not contain any restrictive provision unless, before the agreement is made, the Director has consented to the inclusion of such a provision and, for the purposes of this paragraph, a provision in an agreement is a restrictive provision if by virtue of the existence of such a provision (taken alone or with other provisions) the agreement is one to which the Restrictive Trade Practices Act 1976 would apply but for paragraph 1 (1) of Schedule 3 to that Act.
Publication and Notification Requirements
13.12 No later than 28 days after entering into an agreement under paragraph 13.1 or amending such an agreement, the Licensee shall publish the agreement or the amendment, as the case may be. Where the Licensee or the Operator has requested the Director to consent to the exclusion of any commercially confidential matter, the Licensee shall not publish the agreement or amendment until such time as the Director notifies it of his decision, after he has consulted the Licensee and Interested Parties, and the 28 day period has expired. The 28 day period shall not commence or shall cease to run on the date of the request for exclusion, as the case may be, and shall commence to run or run once more on the date of notification by the Director. The Licensee shall exclude from publication any commercially confidential matter to which the Director has consented.
13.13 For the purposes of paragraph 13.12 publication shall be effected by:
(a) sending to the Director the agreement or amendment; and
(b) keeping a list of all such agreements and amendments (together with a note of the address and telephone number of the person to whom any request for a copy of any or all of such list, agreements or amendments or any part of them may be made).
13.14 The Licensee shall send a copy of such list, or (following publication) any agreement or amendment or part of them to any person who may request the item, on the basis of paying a reasonable charge for it. The Licensee shall send any items so requested within seven working days of receiving the request.
13.15 The Licensee shall make available ... [in a publicly accessible part of every Major Office as specified in Condition 16.3(b)] a notice of the address and telephone number referred to in paragraph 13.13.
13.16 (a) Except to the extent that the Director otherwise consents, within one year from the date of the previous publication and within 10 working days from the date on which a proposal to offer a new Standard Service comes into effect, the Licensee shall, in accordance with sub-paragraphs (c) and (d), publish a full list of Standard Services (the "Standard List") ... specifying:
(i) the charge payable by an Operator for each Standard Service;
(ii) the terms and conditions associated with the provision of each Standard Service;
(iii) the amount applied to:
(aa) each Network Component or combination of Network Components used in providing each Conveyance Standard Service and the unit cost charged by way of Transfer Charge for each Network Component or combination of Network Components provided by one Business to another Business (with, in both cases, the relevant [routing factors]); and
(bb) each Network Part or combination of Network Parts used in providing each Non-conveyance Standard Service and the unit cost charged by way of Transfer Charge for each Network Part or combination of Network Parts provided by the Licensee from one Business to another Business),
(cc) [sticks (eg, the amounts applied to Call Origination Local-remote Transmission and Local-tandem Transmission and to Call Termination Local-remote Transmission)]
reconciled in each case to the charge payable by an Operator; [provided that in the case of any Network Component, combination of Network Components or a Network Part or combination of Network Parts that is used in the provision of one or more Competitive Standard Services, but is not also used in the provision of any other Standard Service that is not a Competitive Standard Service, the Licensee shall not be required to include in the Standard List the amount applied to that Network Component, combination of Network Components, Network Part or combination of Network Parts or the unit cost charged by way of Transfer Charge applied in respect of any of those matters];
(iv) the Transfer Charge for each Network Component which is not used in providing a Conveyance Standard Service; and
(v) the Transfer Charge for each Network Part which is not used in providing a Non-conveyance Standard Service.
(b) Within 10 working days from the date on which a proposal to change a charge or terms and conditions or to offer a new Service comes into effect ..., the Licensee shall amend the Standard List to take account of the change and shall publish the amendment by sending it to the Director and to all Operators.
(c) The Licensee shall send a copy of the most up-to-date Standard List and any amendments not incorporated into the List to any person who may request it on payment of a reasonable charge. The Licensee shall send the copy within seven working days after receiving payment of that charge.
(d) The Licensee shall make available [in a publicly accessible part of every Major Office as specified in Condition 16.3 (b)] a notice of the address and telephone number of the person to whom any request for a copy of the most up-to-date Standard List and any amendments to it may be made as well as a copy of that List and amendments for inspection.
13.17 (a) Subject to sub-paragraphs (c) and (d), in the case of Competitive Standard Services and Prospectively Competitive Standard Services, not less than 28 days and, in the case of all other Standard Services, not less than 90 days, before any change to a charge for a Standard Service or its associated terms and conditions, or any offer of a new Service, is to come into effect, the Licensee shall send to the Director and all Operators written notice of a proposal (a "Network Charge Change Notice") which identifies:
(i) the Standard Service or new Standard Service and the existing charge payable for and the associated terms and conditions of the Service and the proposed charge or terms and conditions, or the proposed new charge and associated terms and conditions, as the case may be;
(ii) the proposed effective date ...;
(iii) in the case of a Conveyance Standard Service, the existing and proposed amount, or proposed new amount, and the relevant [routing factors], applied to each Network Component comprised in that Conveyance Standard Service ..., and, in the case of a Non-conveyance Standard Service, the existing and proposed amount, or proposed new amount, applied to each Network Part comprised in that Non-conveyance Standard Service ..., reconciled in each case with the existing, proposed or proposed new charge payable for the relevant Standard Service ...;
...
(iv) in the case of a Service to which paragraph 13.19(a), (b) or (c) applies, the relevant information specified in sub-paragraph (iii) with respect to all other Services to which that paragraph applies, and
(v) [sticks (eg, the amounts applied to Call Origination Local-remote Transmission and Local-tandem Transmission and to Call Termination Local-remote Transmission)]
the Licensee shall not offer or charge any such proposed new Service or changed charge or associated terms and conditions to any Operator before 2 October 1997 or before the expiry of the relevant notice period, whichever is later.
(b) The Licensee shall place a copy of the Network Charge Change Notice [in a publicly accessible part of every Major Office as specified in Condition 16.3(b)] for inspection by, and shall send a copy of the Notice to, any person who may request it.
(c) When the Director decides to open an investigation into a proposed charge for a Standard Service before the period of notice specified in sub-paragraph (a) expires, on the basis that:
(i) it is not independent of the type of application of the Service which Operators implement or may implement; or
(ii) except in the case of a Competitive Standard Service, it will not differ by time of day in accordance with the Licensee's retail time of day gradient,
the Director may direct that the period of notice specified in sub-paragraph (a) shall cease to run until a specified date, that the Notice shall not have effect or that, except to the extent that enforcement action is taken against the proposal, the relevant proposal may not take effect except in accordance with a further Notice under sub-paragraph (a) sent after a specified date.
(d) ....Without prejudice to Condition 52, if, in the opinion of the Director, the information provided in a Network Charge Change Notice does not contain all the information specified in sub-paragraph (a) ..., the Licensee shall provide to the Director, in the manner and at the times as the Director may request, such further information as the Director may reasonably require. If the Director makes such a request, he may direct that the period of notice specified in sub-paragraph (a) shall cease to run until a specified date, that the Notice shall not have effect or that, except to the extent that enforcement action is taken against the proposal, the relevant proposal may not take effect except in accordance with a further Notice under sub-paragraph (a) sent after a specified date .
Charge Control for Standard Services
13.18 Subject to paragraph 13.17, and without prejudice to any other provisions of this Condition or any other Conditions of this Licence, from 1 October 1997, the Charges (for the Standard Services subject to paragraph 13.19(a), (b) and (c)) shall be those specified on a list agreed between the Director and the Licensee on or before the date on which this Condition comes into force. For the purposes of paragraphs 13.19 to 13.34, the Charges for [IEC, ISI and CSI] shall be deemed to be the charges that the Licensee would offer to or charge an Operator for the relevant service if no costs of the service were allocated (or Transfer Charge made) to the Licensee.
13.19 The Licensee shall take all reasonable steps to secure that, during any Relevant Year:
(a) the aggregate of Charges for Call Origination Conveyance Standard Services, [Single Transit Conveyance Standard Services] and [Local-tandem Conveyance Standard Services];
(b) the aggregate of Charges for Call Termination Conveyance Standard Services, and
(c) the aggregate of Charges for:
(i) data mangement amendments to allow the routing of emergency calls to Land Mobile Radio Service Operators;
(ii) data management amendments for indirect access from Public Call Boxes and Temporary Call Boxes;
(iii) [IEC, ISI and CSI (connection, rental and transmission)]; and
(iv) [payphone access], and
(v) the amount applied to [PPP],
in each case remains such that:
(d) if the Controlling Percentage for that Year (established in accordance with paragraph 13.26) is zero or positive, any Percentage Change which has taken place in the aggregate of the relevant Charges (calculated in accordance with paragraphs 13.28 and 13.29) at the end of each Period does not constitute an increase by more than the Controlling Percentage; or
(e) if that Percentage is negative, there is no Percentage Change in the aggregate by way of increase and, before the end of that Year, there is such a Change by way of reduction of not less than that Percentage.
[Note: the drafting of the above paragraph should not be viewed as implying that X will be same for each "basket".]
13.20 Where, for the purpose of complying with paragraphs 13.19 to 13.34, the Licensee is required to reduce, or to limit any increase in, its Charges in any Relevant Year the Licensee shall take all reasonable steps to ensure that the combined effect on accrued revenue of the Licensee of all individual changes ... shall be no less than, in the case of a required reduction, that which would have been produced had all of those changes been made at exactly the same time and no later than on 1 April in that Year, or more than, in the case of a limited increase, that which would have been produced had all of those changes been made at exactly the same time and no earlier than on 1 April in that Year, and accordingly 1 April in that Year shall be the latest or, as the case may be, earliest weighted average date (within the meaning of paragraph 13.21) in that Year for the purposes of the making of reductions or increases in Charges. For the purpose of establishing whether or not the Licensee has complied with the obligation imposed on it by this paragraph, a calculation shall be carried out by employing the formula set out in paragraph 13.21.
13.21 The formula mentioned in paragraph 13.20 is:
n
WAD = (sum over) Ri/RC x Di < 0
i=1 RC
Where:
WAD = the weighted average date
Ri = the revenue change associated with the ith price change made in the Relevant Year
RC = the total revenue change required in the Relevant Year to achieve compliance with paragraph 13.19
Di = the date on which the ith price change takes effect expressed as a numeric entity on a scale ranging from 1 October = -184 to 30 September = 180, except in a leap year when 30 September = 181.
n = number of price changes during the Relevant Year
13.22 To the extent that the Licensee has made, during any Relevant Year, any changes in Charges beyond those necessary for compliance with paragraph 13.19, those changes shall be relevant in applying paragraphs 13.20 and 13.21 to changes in the Relevant Year immediately following the Relevant Year in which those changes were made. In applying the formula referred to in paragraph 13.21 to such changes, subject to paragraph 13.23, that formula shall apply with the meaning of Di amended as follows:
Di = the date on which the ith price change takes effect expressed as a numeric entity on a scale ranging from 1 October = -549 to 30 September = -185, except in a leap year when 1 October = -550.
13.23 If, in relation to any change in Charges to which paragraph 13.22 applies, the Director is of the opinion that Di should not equal the date on which that change takes effect as described in that paragraph, but should equal 1 October in the immediately following Relevant Year (expressed as a numeric entity where 1 October = -184), he shall so direct the Licensee as soon as practicable after receipt by the Director of notification by the Licensee of the change and the Director shall include in his direction the reasons for his opinion. Where the Director has given such a direction the formula referred to in paragraph 13.21 shall apply with Di = -184 to any change in Charges to which that direction relates.
13.24 Where, notwithstanding the obligation imposed on the Licensee by paragraph 13.19, there has taken place a change in Charges of a kind not permitted under paragraph 13.19(d) or (e), the Licensee shall make such adjustments in Charges (or leave them unchanged), for the period, whether in the year in question or the following year (and whether or not that year is a Relevant Year), as may be reasonably required to satisfy the Director that the matter has been remedied. Such adjustments shall not be relevant for the purpose of establishing compliance with paragraph 13.19 in a following Relevant Year.
13.25 Where notwithstanding the obligation imposed on the Licensee by paragraph 13.20, the effect on accrued revenue of the changes in Charges fails, in the opinion of the Director, to meet the requirements of that paragraph, the Licensee shall make such adjustments in Charges (or leave them unchanged), for the period, whether in the year in question or the following year (and whether or not that year is a Relevant Year), as may be reasonably required to satisfy the Director that the matter has been remedied.
13.26 Subject to paragraphs 13.27, 13.31 and 13.32, the Controlling Percentage in relation to any Relevant Year is the amount of the change in the Retail Prices Index in the period of 12 months ending on 30 June immediately before the beginning of that Year, expressed as a percentage (rounded to two decimal places) of that Index as at the beginning of that period ("RPI"), reduced by X.
13.27 If the difference between Charges at the beginning and at the end of any Relevant Year is such that the relevant Percentage Change ... is less (in the case of a permitted increase), or greater (in the case of a required reduction), than the change permitted, or required, in accordance with paragraph 13.19, then the Controlling Percentage for the following Relevant Year shall be established in accordance with paragraph 13.26, but increased by the amount of such deficiency or excess (as the case may be).
13.28 The amount of a Percentage Change ... which has taken place at any time during a Relevant Year is determined by taking the amount of the change in each Charge which has taken place between the beginning of the Relevant Year and that time, multiplying that amount by the amount of the revenue reasonably believed by the Licensee to have accrued during the Relevant Financial Year in respect of the Standard Service for which that Charge is charged, dividing in each case the amounts so produced by the Charge at the beginning of the Relevant Year for the Service to which each such amount relates, and taking the aggregate of the results, expressed as a percentage of all the revenue reasonably believed to have accrued for the relevant Standard Services during the Relevant Financial Year.
13.29 Notwithstanding paragraph 13.28, if the Licensee has notified the Director in writing both of its intention to increase during a Period one or more Charges and of its intention within three months of the first such increase to reduce one or more Charges then, unless:
(a) the Director dissents within 28 days of such notification on the ground that undue advantage is being taken of this paragraph; or
(b) the reduction as so notified is not introduced,
for the purposes of paragraph 13.28, when determining the amount of a Percentage Change which has taken place at the end of the said Period and each subsequent Period, it shall be assumed that any such reduction had taken place during the first mentioned Period.
13.30 Where the Licensee makes a material change (other than to ... a Charge) to any Service for which a Charge is charged or to the date on which its financial year ends or there is a material change in the basis of the Retail Prices Index, paragraphs 13.19 to 13.34 shall have effect subject to such reasonable adjustment to take account of the change as the Director may, after consultation with the Licensee, determine to be appropriate in the circumstances; and for the purposes of this paragraph a material change to any Service includes the introduction of a new Service wholly or substantially in substitution for that existing Service.
13.31 If the Licensee imposes a specific charge or an increased charge in relation to any goods or service which up to the time when the charge or increased charge is first imposed had been provided without charge or at a lower charge and the Director determines, after consultation with the Licensee, that some or all of the costs properly attributable to that service had previously been attributed to services to which paragraph 13.19 applies and that it would be proper in the circumstances for the newly introduced or increased charge to be controlled, that charge shall, unless the Director determines otherwise, be a Charge within the same relevant paragraph 13.19(a), (b) or (c) and this Condition shall have effect subject to the following provisions:
(a) the Licensee shall produce a forecast of the revenue expected to accrue as a result of the Charge or increased Charge for the goods or service over the period of twelve months from the date of introduction or increase of the Charge;
(b) the forecast shall be expressed as a percentage of the total amount of revenue reasonably believed by the Licensee to have accrued in respect of the relevant aggregate Charges during the Relevant Financial Year which relates to the Relevant Year during which the Charge is introduced or increased;
(c) the Controlling Percentage for that Relevant Year shall be reduced by that percentage;
(d) an adjustment shall be made to the Controlling Percentage for that Relevant Year in respect of which it is first possible, from the Relevant Financial Year accounts, to take into account a comparison between the first twelve months' actual accrued revenue from the Charge and the forecast referred to in sub-paragraph (a), whereby the Controlling Percentage for that Relevant Year shall be increased or reduced (as the case may be) by the difference between the forecast amount referred to in sub-paragraph (a) and the amount of actual accrued revenue (the difference to be expressed as a percentage of the total amount of revenue accrued in respect of the relevant aggregate Charges during the Relevant Financial Year which relates to that Relevant Year);
(e) further adjustments shall be made to the Controlling Percentage referred to in sub-paragraph (d) ...:
(i) where there is any difference between the forecast referred to in sub-paragraph (a) and the actual accrued revenue referred to in sub-paragraph (d), in order to compensate for the extent to which, by virtue of that difference, Charges in previous Relevant Years have been too high or too low (as the case may be), and
(ii) where there has been any variation in the Charge for the goods or service between the Relevant Year referred to in sub-paragraph (b) and the Relevant Year referred to in sub-paragraph (d) which the Director, after consultation with the Licensee, determines should be taken into account for the purposes of calculating the Controlling Percentage; and
(f) the adjustments referred to in sub-paragraphs (d) and (e) shall be made in the manner which the Director determines to be appropriate in the circumstances, after consultation with the Licensee.
13.32 If the Charge or increased Charge for any goods or service covered by paragraph 13.31 is altered following its introduction but before the adjustment referred to in paragraph 13.31(d) can be made then, in respect of that Charge, in calculating the amount of a Percentage Change ... under paragraph 13.28, the forecast set out in paragraph 13.31(a) shall be substituted for the amount referred to in paragraph 13.33(a).
13.33 The Licensee shall no later than the time at which it notifies or should have notified the Director under paragraph 13.17 of any change to any Charge inform the Director in writing of:
(a) the amount of revenue which the Licensee reasonably believes to have accrued in the Relevant Financial Year for each Service in respect of which a Charge is charged; and
(b) the amount of each Charge at the beginning of the Relevant Year.
13.34 The Licensee shall as soon as practicable after the end of each Period in which there has been a change in a Charge inform the Director in writing of:
(a) the changes made or new charges imposed in relation to any Charge during the Period specifying its nature and amount and the Service for which the Charge is charged; and
(b) the amount of the Percentage Change in the relevant aggregate Charges which has taken place during the Period and whether by way of increase or reduction.
13.35 The Licensee shall ... secure that each discrete charge for, or amount applied to, any Prospectively Competitive Standard Service, including charges disaggregated by time of day, distance or route, described in this paragraph, namely:
(a) [inter-tandem] Conveyance Standard Services;
(b) international direct dialled Conveyance Standard Services; and
(c) [the value added part of directory information services,]
does not increase in the first Relevant Year from the Interim Charge determined by the Director under Condition 13 in effect on 30 September 1997 by more than RPI and during any following Relevant Year by more than RPI (taking out of account, where applicable, any payment by the Licensee to a person operating a telecommunication system outside the United Kingdom). For the purposes of compliance with this paragraph, the Licensee shall secure that any increase of a charge shall be proportionately no more than the proportion of RPI which is derived by multiplying RPI by a fraction, the numerator of which is the number of days which have elapsed from the beginning of the Relevant Year to the effective date of the charge change and the denominator of which is 365 (or, in a leap Year, 366), plus any proportion of RPI in previous Relevant Years which has not been taken up by charge increases.
13.36 Except to the extent the Director otherwise consents (on the grounds that the quality and security of the Service would otherwise be endangered), the Licensee shall take all reasonable steps to secure that each discrete charge for, or amount applied to, that part of a Public Emergency Call Service (defined in Condition 6) which is not a telecommunication service does not increase from the charge, or the amount applied to that part of the charge, [base charge] during any Relevant Year by more than RPI.
13.37 (a) The Director shall, following a representation by the Licensee or an Operator that the market for a Standard Service is competitive, determine whether or not that market is competitive.
(b) If the Director determines that the market is competitive (whether before or after 1 October 1997), then that Standard Service (including a Prospectively Competitive Standard Service) shall be a Competitive Standard Service.
(c) The Director may, following a representation by the Licensee or an Operator that the market for a Competitive Standard Service is not or has ceased to be competitive, determine that the market is not competitive. When the Director determines that the market for a Competitive Standard Service is not competitive, that Standard Service shall cease to be a Competitive Standard Service.
[13.38 When, in the opinion of the Director, a Standard Service to which paragraphs 13.19 to 13.36 do not apply and which is not a Competitive Standard Service is offered or provided by the Licensee at a charge which is unreasonable and it is likely that the Service will not be competitive before 30 September 2001, without prejudice to any other powers he may have, following consultation with the Licensee and Interested Parties, the Director may determine that the charge be reduced, or not increased, during any Relevant Year by the amount which he considers requisite to cause the charge to be reasonable.]
13.39 If the Director is minded to conclude that a determination, direction or consent under this Condition is appropriate, or... is not appropriate, he shall notify the Licensee and Interested Parties of his proposed decision, ... and his reasons for ... it, ... and give each of them a reasonable opportunity to make representations. On making or refusing a determination or direction or giving or refusing consent ..., he shall notify the Licensee and Interested Parties of the determination, direction or consent or refusal, as the case may be, and his reasons for ... it ...
13.40 Paragraphs 13.19 to 13.35 shall not apply to such extent as the Director may determine upon request by the Licensee.
Interpretation
13.41 In this Condition:
(a) "Business" has the meaning given to it in Condition 20B;
"Call Origination Conveyance Standard Service" means a Conveyance Standard Service provided by the Licensee from (but not including the conveyance of Messages over) an Exchange Line to the local exchange;
["Call Origination Local-remote Transmission" means [ ]:]
"Call Termination Conveyance Standard Service" means a Conveyance Standard Service provided by the Licensee from the local exchange to (but not including the conveyance of Messages over) an Exchange Line;
["Call Termination Local-remote Transmission" means [ ];]
"Charges" means charges (being in all cases the amounts offered or charged by the Licensee) to Operators for the Standard Services described in paragraph 13.19(a), (b) or (c), as the case may be, other than charges for:
(i) Prospectively Competitive Services; or
(ii) ... Competitive Standard Services,
and each discrete charge of any such description shall be treated as a separate Standard Services Charge;
"Competitive Standard Service" means a Standard Service, ... the market for which has been determined by the Director to be competitive pursuant to paragraph 13.37, or a Standard Service which is not subject to paragraphs 13.19 to 13.35, and which, in either case, has not ceased to be a Competitive Standard Service pursuant to paragraph 13.37(c);
...
"Connectable System" means a telecommunication system which is authorised to be run under a Licence which authorises the connection of that system to any of the Applicable Systems;
"Connection Service" means a telecommunication service consisting in the conveyance of any Message which has been, or is to be, conveyed by means of any of the Applicable Systems;
"Conveyance Standard Service" means a Standard Service comprising the conveyance of switched Messages;
...
"Interested Parties" means those persons (if any), other than the Licensee, with whom, in any particular case, the Director considers it appropriate to consult;
"Land Mobile Radio Service" means any telecommunication service provided by means of wireless telegraphy where every Message that is conveyed has been, or is to be, conveyed by means of apparatus which is or is to be used while in motion;
[" Local-tandem Transmission" means [ ];]
...
"Major Office" has the meaning given to it in Condition 16;
"Network Charge Control Notice" has the meaning given to it in paragraph 13.17;
"Network Components" means the network components specified on the list of network components as agreed between the Director and the Licensee on 17 December 1996 and as amended from time to time by the Licensee with the consent of the Director;
"Network Parts" means the network parts specified on the list of network parts as agreed between the Director and the Licensee on 17 December 1996 and as amended from time to time by the Licensee with the consent of the Director;
"Non-conveyance Standard Service" means a Standard Service which is not a Conveyance Standard Service;
"Operator" means a person who is authorised by a Licence to run a Relevant Connectable System ...;
"Percentage Change" has the meaning given to it in paragraph 13.28;
"Period" means a calendar month or such longer period as the Director may determine;
"Prospectively Competitive Service" means a Standard Service which is described in paragraph 13.35 (but does not include a Service determined by the Director to be a Competitive Standard Service);
"Quality" has the meaning given to it in Condition 17B;
"RPI" is the amount of the change in the Retail Prices Index in relation to any Relevant Year as specified in paragraph 13.26;
"Relevant Connectable System" means a Connectable System which is authorised to be run under a Licence which authorises the provision by means of that System of Connection Services for reward to the public, or any class of the public, not being a system:
(i) authorised to be run under a Licence granted to all persons or persons of any class; and
(ii) for the connection of which, and for the provision of matters necessary for such connection, the Licensee offers standard terms and conditions which satisfy the requirements of Condition 16;
and not being a system which the Director has determined ought not to be deemed to be a Relevant Connectable System for the purposes of this Condition; and
"Relevant Financial Year" means in relation to a Relevant Year the financial year of the Licensee ending last before the beginning of the Relevant Year, being a financial year in respect of which annual accounts have been prepared and audited in accordance with the requirements of the Companies Act 1985;
"Relevant Year" means any of the four periods of 12 months beginning on 1 October starting with 1 October 1997 and ending on 30 September 2001;
"Retail Prices Index" means the index of retail prices compiled by Her Majesty's Government in respect of all items;
"Standard Service" means a service, including a Competitive Standard Service, which an Operator has required from the Licensee and which the Licensee is obliged to provide, or to enter into an agreement to provide, under Condition 13; and
"Transfer Charge" means the charge which is applied by the Licensee to a Business for the provision by the Licensee from another Business to that Business of a Network Component or combination of Network Components or a Network Part or combination of Network Parts;
(b) references to a charge for a Standard Service shall include ... the means of calculating that charge;
(c) references to a charge being payable are references to a charge being payable in accordance with an agreement made in pursuance of this Condition;
(d) ...
(e) for the avoidance of doubt:
(i) any question as to whether any term or condition is reasonable or whether any charge is reasonably derived from costs shall be decided by the Director in the exercise of his functions under section 16 of the Act having regard to any guidelines on the application of this Condition issued from time to time by the Director;
(ii) in the exercise of his functions under section 16 of the Act, the Director may decide that it is requisite for the purpose of securing compliance with this Condition, [Condition 17 or Condition 18A] to order changes to the terms and conditions (including charges) offered to all Operators or to a specified category of Operators with effect from the effective date of a proposal under paragraph 13.17;
(f) any reference to "service" or "Standard Service" which is not part of the expression "goods or service" shall be taken to include a reference to goods or information ...; and
(g) [references to accrued revenue are references to the amount of revenue which would be produced before the application of any discounts to the charge for the relevant Standard Service.]"
2. The substitution of Condition 13 above shall be without prejudice to the powers of the Director in Conditions 13 and 16B in effect on 30 September 1997 to determine Final Charges for the financial years ending on 31 March 1996, 31 March 1997 and 31 March 1998 (and without prejudice to any related provisions and obligations of the Licensee), except that in the case of the determination of Final Charges for the year ending on 31 March 1998, the determination shall:
(a) have effect only for the period 1 April 1997 to 30 September 1997;
(b) be made as soon as reasonably practicable after 30 September 1997; and
(c) be based on the audited information appearing by virtue of Condition 20B.8 in effect on 1 October 1997 in the Licensee's Interim Financial Statement for the relevant Businesses for the financial year ending on 31 March 1998.
3. With effect from 1 October 1997 [consequentials for other Conditions will go here]:
(a) In Condition 16.1, for the words "which have been or could be determined" shall be substituted the words "offered to or agreed with Operators".
(b) In Condition 20B.1(b), for the words "under the Licence, to determine charges to be payable to the Licensee by an Operator which" shall be substituted the words "to examine or investigate charges offered, payable or proposed to be offered or payable to or by an Operator to the".
[further modifications to Cond 20B are required]
B.1 When finalised this will be a stand-alone document containing guidelines on the structure and operation of the network charge controls, and how Oftel will approach complaints about intercon-nection charges. The current draft has been developed from the previous versions published in June and December 1996 as a basis for further discussion prior to the formal consultation on the network charge control licence modifications in July 1997. Text is omited at some points of the draft where policy is not yet finalised. Where this is the case, reference is made in square brackets to the need to add to or clarify the existing text.
B.2 The draft text of the Guidelines is as follows:
"1 These Guidelines contain guidance on the structure and operation of the network charge control arrangements which will run from October 1997, and on Oftel's approach to complaints about interconnection charges. They explain:
2 These Guidelines should be used in conjunction with Oftel's Guidelines on the Operation of the Fair Trading Condition which explain Oftel's general approach to complaints about anti-competitive behaviour. Like those Guidelines, the Guidelines on operation of the Network Charge Controls will not be legally binding. The Director General will expect to follow them unless circumstances require otherwise and he will always give reasons for his decisions.
3 Oftel has identified three categories of competition for services in the interconnection market for the period of these controls (1 October 1997-30 September 2001). These are:
The charges for the latter two categories of services which will not be competitive during the charge control period will be subject to charge controls over and above the requirements of competition law and the generally applicable conditions in the licences of operators. Details of these controls are contained in these Guidelines starting at paragraph 6.
4 A full list of BT's standard services is at Appendix I to these Guidelines.
5 Services are categorised within the network charge controls as follows:
Service: Value added element of operator assistance (OA)
6 The wholesale market for operator assistance is competitive with operators having a choice of supplier (operators and service providers) including self provision. BT will therefore be free to set charges for the value added element of its OA service subject to competitive commercial constraints and the generally applicable conditions of its licence.
7 There is no discrete service for conveyance to OA. Operators can purchase whatever conveyance components they require to access OA services from BT. OA Centres are reached from local exchanges but, because reaching these centres does not involve terminating a call over an exchange line, the local exchanges fulfill a tandem function for access to OA Centres. Thus, the conveyance element of the OA service will normally consist of inter-tandem transit which (see below) is a prospectively competitive service.
Services: Inter-tandem conveyance; inter-tandem transit; international direct dial (IDD) conveyance; value added elements of access to Directory Enquiries (DQ) services: Operator Services Information System (OSIS), Directory Assistance System (DAS), and `phonebooks; [possibly targeted transit - depending on whether the charge for targeted transit is determined for the start of the charge controls.]
8 Oftel believes that these services will become competitive during the charge control period. However, to safeguard other operators against excessive charges in the event that competition does not bite as expected, these services are subject to safeguard charge caps set at RPI+0%. This will mean that BT could raise its charges by up to the level of RPI+0% applied cumulatively to the starting charge. However, increases will be constrained by competitive pressure. In the event that services which are currently prospectively competitive are determined as competitive, safeguard caps can be lifted and BT will be free to set charges subject to competitive commercial constraints and the generally applicable conditions of its licence (see paragraph 37 below for explanation of the process for determining services as competitive).
9 A number of national operators offer inter-tandem conveyance and inter-tandem transit , and Oftel expects competition to develop further during the charge control period. Oftel does not consider that competition at the start of the charge control period will be sufficient for inter-tandem conveyance to be free of any charge controls. Safeguard caps are therefore appropriate and each discrete charge for inter-tandem conveyance and inter-tandem transit, including when disaggregated by distance or time of day, will be subject to a safeguard cap of RPI+0%.
10 With full international liberalisation, Oftel expects that all international routes are prospectively competitive. Each discrete charge for IDD conveyance (excluding gross outpayments to overseas operators) including when disaggregated by distance, route (country pair), or time of day, will therefore be subject to a safeguard cap of RPI+0%.
11 The treatment of these services may be affected by the reforms to liberalise directory information markets. For example, some services may be moved from BT's Systems Business to its Supplemental Services Business.
12 The value added elements of all these DQ services should become competitive when the reforms to liberalise these markets have been put in place and had time to take effect. Oftel expects these reforms to be implemented early in the charge control period. However, in advance of this, all these services are categorised as prospectively competitive. If, as anticipated, these service quickly become competitive, Oftel would expect early representations under Condition 16B.6 of BT's licence for the Director General to determine them to be so (see paragraph 37 below for explanation of the process for determining a service competitive).
13 As for OA, those parts of the conveyance elements of DQ services using the PSTN can be purchased from BT, but there is no discrete service for DQ conveyance. As DQ centres are accessed from tandem switches plus use of the DSN, the conveyance element of DQ services is likely to be inter-tandem transit plus use of the DSN.
[The text on targeted transit will depend on whether Oftel receives a request to determine charges for this service before the start of the charge control period. If it does not, the service will be treated as a new service.]
14 Oftel does not consider that competition in the provision of this service will be sufficient at the start of the charge control period for the service to be categorised as competitive but as for inter-tandem transit, it expects competition to develop further during the charge control period. A safeguard cap of RPI+0% therefore applies.
Services: Call origination; local-tandem conveyance; single transit.
15 Oftel believes that services in this basket will not be competitive during the charge control period and that an additional control is therefore necessary to prevent excessive charging and to provide BT with incentives to reduce its costs to an efficient level over the period of the charge controls. The basket is therefore subject to a charge cap set at RPI-X. An explanation of how adherence with the charge caps (for the call termination, general network, and connection services baskets) will be monitored is included in the Guidelines starting at paragraph 42 below.
16 A surcharge on call origination charges can be recovered from indirect access operators for certain OA and DQ services (known as `intermediate services') for which no retail charge is levied to retail customers. These are:
In both cases, the surcharge is only applicable where the indirect access operator purchases the service(s) in question from BT.
17 Oftel believes that this is appropriate because provision of these services free of charge to the customer is desirable, and in the case of the latter, required by regulation. It is therefore appropriate for competitive neutrality that indirect access operators should contribute to the costs of these services which are available to their customers as well as to BT's. If this were not the case, the indirect access operators would have a cost advantage over BT (which recovers these costs through retail call prices) not justified by greater efficiency.
18 Oftel believes that call termination is a true long-term bottleneck (ie it is likely to remain uncompetitive even in the long term). The charge cap for call termination is set at RPI-X. It is set in a basket on its own because direct control of the charge for call termination is necessary to prevent excessive charging and to provide BT with incentives to reduce costs to an efficient level over the period of the charge cap.
19 The industry is considering the application of reciprocal charges to calls terminating on BT's and other networks. These reciprocal charges would be based on the costs of terminating calls on BT's network. Oftel strongly endorses this arrangement which has the following advantages:
20 The economic rationale for reciprocal charging for call termination is as follows.
21 As an interconnection service, call termination has particular characteristics arising from an externality. An externality exists where the actions of an individual or organisation cause costs to be incurred or benefits to be gained by others, but that individual or organisation has no incentive to take those costs or benefits into account. The `call termination externality' occurs because the retail price of a call is paid by the calling party and not the called party. The calling party has no influence over the called party's choice of network provider, but the charge for call termination will be reflected in his payments to the operator providing services to him. This can lead to a distortion of competition because benefits from a reduction of call termination costs by an operator will be felt by its competitors if each operator's charges are strictly cost based (ie the less efficient operator pays the lower call termination charges). And, similarly, higher costs will be met by competitors (so inefficiency is not penalised and indeed could be competitively advantageous).
22 This distortion can be removed if the charges for call termination on OLO networks are based on the charges paid by OLOs to BT for call completion on BT's network.
23 Reciprocal charging would be straightforward to apply if operators had identical network topologies. This is clearly not the case, and, in practice, there are a number of ways in which the principle of reciprocal charging could be applied. The industry has discussed a number of options. It has been agreed that [text to be completed when agreement has been reached on how reciprocal charging will work in practice.]
Services: Interconnection circuits; DMAs for routing emergency calls for mobile operators; [possibly interconnection specific costs: Product Management, Policy & Planning (PPP); connection of partial private circuits]; number portability services
24 At present, there are a number of other services which interconnecting operators can only purchase from BT and which therefore cannot be classed as competitive. The `connection services' basket -contains all such services except number portability. An indexation of RPI-X applies to this basket. [Text to be added on how charges for number portability services will be controlled depending on the outcome of consideration given to this issue outlined in Chapter 3 of the consultative document.]
25 It is possible that BT will introduce new services during the life of the charge control which will fall into this category. See paragraphs 34 to 36 below for explanation of how such services will be treated.
26 These are the circuits at the point of interconnect which connect BT's network with those of other operators at either inland or international exchanges. They can only be purchased from BT, are therefore not competitive and so are included in the connection services basket. Oftel would expect other connection services which use the same individual elements as these services (for example, customer sited handover (CSH) uses many of the the same elements as ISH) to be priced consistently in terms of the charge for each element. Failure to do so would be likely to be viewed as anti-competitive or unduly discriminatory.
27 Oftel expects that costs for ISI, CSI and IECs will be shared according to the proportions in which BT and the interconnecting operator will bill customers for originating calls which are to be conveyed over the point of connection (this would mean an OLO would pay the whole cost for an IEC because IECs only carry OLO owned traffic). The proportions should be derived from forecasts by each party of the capacity required to convey those calls for which the respective parties will bill customers originating them.
28 This is not a competitive service and so is included in the connection services basket.
[Treatment of these costs will depend on the outcome of the modelling exercise currently being undertaken by the Incremental Costs Working Group.]
29 These costs arise from the planning of inteconnect and the management of interconnect relationships. They are not competitive for operators interconnecting with BT and are therefore included in the connection services basket.
[This text will depend on whether or not Oftel is requested to determine the charge for connection to partial private circuits before October. If not, connections will be treated as new services.]
30 Operators supplying partial private circuits will need to connect them with BT's private circuits in order to offer a full circuit. This connection service will remain a standard interconnection service: it is clearly not competitive as only BT can provide it and is therefore included in the connection services basket.
[The text on number portability will be completed following consideration of this issue as set out in the consultative document.]
31 The following services are not classified in the five categories covered above:
32 [This may need to be reviewed in the light of current discussion in the industry about the NTS formula. If there are any changes, the Guidelines will be amended correspondingly.] These services include BT's `Freefone', `Lo-call', and premium rate services. The charging methodology for access to BT's NTS previously set out in Oftel's determinations of standard interconnection charges remains, in Oftel's view, the soundest basis for charges and Oftel would expect it to continue to apply. Thus, BT should receive the deemed retail price for calls to its NTS and make payments to the originating operator covering the originating operator's costs of conveyance plus an allowance for additional retail costs incurred. BT's payment to cover the originating operator's costs of conveyance will be based on the charge for a call origination local exchange segment plus local-tandem conveyance (under the general network basket). Details of the calculation are set out in Appendix II to these Guidelines. This approach to charging for NTS, along with a range of other options, was discussed extensively by the industry. The Director General is persuaded that it best meets his objectives to promote innovation and investment in telecommunication services by adequately rewarding those who invest in these services whilst ensuring a fair return for owners of the infrastructure on which the call originates. (NB Oftel considers that these principles should apply generally - to payments for access to other operators' NTS services as well as BT's.)
33 A safeguard cap of RPI+0% applies to the (unbundled) charge for emergency service provided by BT to other operators' customers. BT can apply to the Director General for consent to exceed the limit set by the safeguard cap if it can demonstrate that not to increase charges would endanger the quality and security of the emergency service. Exceptionally, this control was not set on the basis of the competi-tiveness of the service, but to ensure that provision of this essential service to their customers does not disadvantage OLOs and that the quality of the service is not compromised. As for DQ and OA charges, Oftel would expect conveyance services used for access to BT's emergency service to be purchased in the normal way.
34 When a new service is introduced, customers cannot be made worse off, provided that all existing services continue to be available. The prospect of excessively restrictive regulation could deter innovation and prevent operators from benefitting from the new service offering. Generally therefore, when a new interconnection service is introduced by BT, there will initially be a presumption that no charge control will be necessary. As for any new charge introduced by BT, operators will be free to challenge it if they feel it is anti-competitive or unreasonable (see section on dealing with anti-competitive behaviour starting at paragraph 64).
35 Some new services (eg connection services, number portability services) may not be competitive during the charge control period. Charges for new services could be subject to control by Oftel using appropriate conditions of BT's licence such as Condition 13 or Condition 18A.
36 In the event that the charge for a new service is found after investigation by Oftel to be anti-competitive or unreasonable, it might need to be adjusted or perhaps regulated in a charge cap (either individually or through being added to one of the three pre-existing baskets depending on the circumstances).
37 It is possible that, as the competitiveness of services changes during the charge control period, it will no longer be appropriate for their charges to be controlled in the same manner as at the start of the period. It is most likely that, as the telecoms market generally becomes more competitive, services which are prospectively competitive at the start of the period will become competitive. It is open to any operator to request the Director General to determine a service competitive or that a service has ceased to be competitive under Condition 16B.6 of BT's licence. Oftel does not expect the services in any of the charge control baskets to become competitive during the life of the charge control period. Neither does it expect any existing service outside of baskets to need to be added to baskets. Nevertheless, it is open to any operator to request a determination under Condition 16B.6 of BT's licence with regard to any standard service.
38 Oftel will approach any request for a determination under Condition 16B.6 on its merits. Its approach to the application of Condition 16B.6 is discussed in the forthcoming Guidelines on the operation of Condition 16B.6. Oftel's approach to the definition of markets and assessing dominance are set out in the Guidelines on the Operation of the Fair Trading Condition.
39 For services contained in charge control baskets (not safeguard caps) Oftel has set initial charges for the charge control period based on a forecast of the unit cost for each service (the relevant incurred long run average incremental cost plus mark-up) on 1 October 1997. Thereafter, BT will set its own charges.
40 The costs of inland conveyance services have been derived from a forecast based on the incremental costs methodology which calculates the long run incremental costs of conveyance broken down into network components (details of the methodology to derive floors and ceilings are set out at Appendix III below). The charges for conveyance services are derived from component costs by the application of routing factors. (For detailed analysis of the incremental costs methodology, see NERA's report to Oftel, Reconciliation of the Top-Down and Bottom-Up Models published in December 1996.)
41 The charges for non-conveyance inland services and international conveyance services are not derived from the incremental costs methodology because the incremental costs models cover only the costs of inland conveyance. [Text to follow on the methodology for deriving the incremental costs of other services.]
42 BT's freedom to set charges for the services which are controlled by the three network baskets will be constrained so that the average charge in each basket cannot be increased by more than RPI-X (if RPI > X), or must be reduced by at least X-RPI (if RPI < X). Compliance with this constraint is monitored by calculating a weighted average change in charges for each basket, where the weight for each service is BT's revenue for that service in the previous Financial Year. The weighted average for each basket is then compared with its respective value of RPI-X. The basket weights will be given by the relative revenue shares of services in the basket in the prior financial year. The weights will include revenues from all purchases of the interconnection services from BT Network, ie including BT Retail as well as OLOs. For the purpose of calculating the weights in the first year, prior year `revenue' would be defined as the service volumes in 1996/97 multiplied by the starting charges for the services set by Oftel for 1 October 1997. This is appropriate so that the weights reflect the change in cost base from fully allocated costs to long run incremental costs plus mark-up.
43 BT is required to comply with RPI-X by the end of each Charge Control Year but is subject to a further constraint on how it phases its price changes. This constraint avoids the possibility of BT increasing its charges prices (if RPI > X) to the full extent permitted early in the Charge Control Year or delaying its required reductions in charges until late in the year. To ensure compliance with this constraint an average date of changes in BT's charges will be calculated for each basket. This will be in the form of a weighted average where the weight applicable to each date is the value of changes to charges implemented on that date. Changes to charges must be implemented in such a way that their effect is equivalent to them all having been made on the same date and that (weighted average) date complies with the constraint. The Weighted Average Date will be after 1 April (if RPI > X) or before 1 April (if RPI < X).
44 If BT's average charge for a basket at the end of a Charge Control Year is lower than required by the associated RPI-X constraint, it will, with the Director General's agreement, be able to carry-over the difference into the next Charge Control Year.
45 Compliance with safeguard caps will be monitored on the basis of the controlling value of the RPI applied cumulatively to the starting charge (ie that set in respect of 1 October 1997) such that the charge at 30 September (ie at the end of the charge control year) in any year is no greater than the maximum permitted charge at the start of the charge control year increased by the controlling value of RPI. BT may increase the the charge during the course of a charge control year but only to the extent that it does not exceed the maximum permitted at the start of a year plus a proportion of the permitted increase for the year where the proportion is determined by the proportion of the price control year which has passed by the date of the increase.
(NB The above only deals with when RPI>0.)
46 BT is required to give 90 days' notice of a change to the charge for services in the call termination, general network, or connection services baskets, and 28 days' notice for those services which are competitive or prospectively competitive.
47 BT is required by Condition 24F of its licence to have the Director General's prior consent for certain price changes which reduces the retail price below the sum of transfer charges to BT Network and BT's retail costs. Where such a retail price involves an effective reduction in the charge for standard interconnection services, the equivalent reduction must be made to the charge for all such interconnection services unless the Director General consents otherwise.
48 Subject to the requirements of the European Union Voice Telephony Directive or the Amending Voice Telephony Directive (whichever is in force), BT can propose changing charges according to end-use with the normal 28 or 90 day notice period provided it is satisfied that the charge is reasonable. However, if Oftel considers that the charge may be unreasonable, or if the charge is the subject of a complaint, the introduction of the charge would be subject to extended notice during which Oftel can investigate it. This means that the relevant notice period will only start when the investigation by Oftel is completed and if Oftel does not prevent the charge from being introduced.
49 For prospectively competitive services, those services in the call termination, general network and connection services baskets, Oftel expects that the tariff gradient for network charges will continue to be directly coupled to that for retail prices. However, BT can propose a decoupled charge provided it is satisfied that it is not anti-competitive or unreasonable. If Oftel considers that the charge may be anti-competitive or unreasonable, or if the charge is the subject of a complaint, the introduction of the charge would be subject to extended notice during which Oftel can investigate it. This means that the relevant notice period will only start when the investigation by Oftel is completed and if Oftel does not prevent the charge from being introduced.
50 The extended notice process would also be available if BT were to announce a major change to the structure of the charges, such as two-part or capacity based charges.
51 BT is required to publish details of cost attributions to network components and parts together with routing factors used to make up the new and old charges for a service whenever it notifies a change to an interconnection charge in a network charge change notice (NCCN). NCCNs will contain [text to be inserted]. For the new charge, BT will be expected to use the latest available audited routing factors.
52 In Oftel's view, the reasonable charge for a DLE when performing a tandem switch function is the charge for a tandem switch. BT will therefore be expected to adjust accordingly the routing factors of services which use DLEs as a tandem switch (ie the routing factor for the tandem switch should be the sum of the factors for the use of tandem switches and DLEs as tandem switches). This may affect services such as local-tandem conveyance, single transit, and inter-tandem conveyance.
53 BT Retail will purchase services from baskets and safeguard caps like interconnecting operators, but it will also need to purchase `sticks' These are the segments left over when BT end-to-end calls are broken down into interconnection services. The sticks are remote-local conveyance for call termination, remote-local conveyance for call origination, local-tandem transmission, and inter-tandem transmission. Since each stick is a sub-set of an interconnection service, BT Retail's transfer charge for a stick will be expected to be calculated using the same routing factors and component rates as its corresponding interconnection service (for the components that they share).
54 This section contains guidance on how Oftel will approach complaints that terms and conditions for interconnection are unreasonable and hence contrary to Condition 13 of BT's licence, or anti-competitive (Condition 18a of BT's licence) or unduly discriminatory (Condition 17 of BT's licence).
55 The Interconnection Condition (Condition 13) is based on a requirement that BT should behave reasonably. In case of dispute about what is reasonable, it will be a matter for the discretion of the Director General. The requirement will cover:
Whether a service should be provided at all will remain a question of what is reasonable (or whether the service is `reasonably required'). The Director General will retain the right to issue a formal determination of any request referred to him under Condition 13.1(c). Where applicable (for example, concerning new services), this will be more important than the more general provisions of Condition 13. Oftel may also regard failure to provide an interconnection service as unduly discriminatory or contrary to Condition 18A - the Fair Trading Condition - of BT's licence. Guidance on the circumstances in which Oftel would expect interconnection to be provided will therefore be added to the Guidelines on the operation of the Fair Trading Condition (NB a draft of this guidance was published for consultation in April 1997 in Oftel's statement on interconnection and interoperability).
56 Should an operator feel that BT is being unreasonable, it may ask Oftel to consider whether the behaviour complained of constitutes a breach of BT's licence. Should Oftel conclude that there has been a breach, it may issue an Order under section 16 of the Telecommunications Act that BT should comply with Condition 13 of their licence. Failure after that to remedy the behaviour complained of may lead to a claim for damages in the civil courts. Condition 13 includes provison for any new charge set as a result of Oftel having found a charge to be anti-competitive or unreasonable to be levied retrospec-tively, backdating to the date of introduction of the original charge if necessary.
57 Complaints about BT's behaviour when dealing with interconnecting operators may also be pursued under other licence conditions. Oftel will consider taking enforcement action under Condition 18A of BT's licence, the Fair Trading Condition where BT abuses any dominant position it may have. Oftel's approach to dealing with anti-competitive behaviour is explained below in the section of these Guidelines entitled `dealing with anti-competitive behaviour' (starting at paragraph 64). In some circumstances, it may be more appropriate to consider whether BT have shown undue preference or undue discrimination, which may lead to an Order to comply with Condition 17.
58 Operators wishing to interconnect should recognise that it is mutually beneficial to reach agreement. Oftel expects all interconnection agreements to be concluded within 6 months of the initial request and failure to do so without compelling reasons - generally beyond either parties' control -may be a breach of Condition 13.1 of BT's licence and equivalent conditions in other licences. Intransigence and persistent unreasonableness which contribute to delay may be referred to Oftel before six months have expired. Such behaviour will include insistence upon terms which no reasonable operator would agree to if they had a choice or refusal of terms which any reasonable operator would accept if they had a choice, or failure to come to a decision on the terms offered or to be offered.
59 Operators wishing to interconnect with each other will have to negotiate and agree the terms and conditions included in their interconnection contracts according to commercial principles. In the majority of cases, the ground which should be covered will be uncontentious because all operators will have similar commercial and technical interests to promote, and Oftel expects a spirit of co-operation to continue to develop.
60 Oftel will generally view it as reasonable to include the following in interconnection agreements:
61 In addition, operators are encouraged to cover the following issues, but the reasonableness of the precise terms proposed will depend on the circumstances of each case:
62 These lists are not exhaustive. What is covered by interconnection agreements is a matter for the contracting parties, as long as their agreements do not have an adverse effect on other operators' networks, consumers or competition generally. The actual terms proposed by either party once the principle of inclusion of the subject matter is agreed, must also be reasonable. Amendments to existing contracts should be dealt with in the same way as the conclusion of new contracts. A new interconnection agreement may be defined either as the addition of a new service to an existing interconnect agreement, or the primary linking of networks where no direct link exists.
63 Complaints should usually be presented in terms of the potential effects on competition in the relevant market of the behaviour complained of. Where the behaviour complained of is clearly unreasonable (perhaps because of the requirements of engineering best practice, or consumer protection) but an effect on competition is more difficult to demonstrate, the complaint may be set out in terms of why a party is plainly being unreasonable. What is unreasonable is a matter for judgement. Oftel will give as much guidance as possible about what is and is not reasonable in the individual circumstances of any dispute referred to it. There is a body of guidance available: past determinations, orders enforcing the Fair Trading Condition in competition disputes and these Guidelines. How Oftel will approach the analysis of behaviour regarded as anti-competitive is set out in the Guidelines on the operation of the Fair Trading Condition and in these Guidelines. These will be applied to interconnection disputes as they apply to any competition dispute except where interconnection-specific rules already exist (for example on availability of services which may be determined under Condition 13.1(c) of BT's licence).
64 The Fair Trading Condition will be applied according to the Guidelines on the operation of the Fair Trading Condition published by Oftel in March 1997, and updated from time to time. Operators are referred to the terms of the Condition and the Guidelines for a full explanation of when it will be used and how. In brief, the Condition is in the form of a prohibition of activities carried on when providing telecommunication services or running a telecom-munications system which have, or are likely to have, the object or effect of preventing, restricting or distorting competition. The Condition catches both abuse of a dominant position and agreements and concerted practices where there is an appreciable effect on competition. The prohibition rests on the economic effect of the behaviour, not its legal form. This means that the Condition does not have the effect of prohibiting particular types of behaviour under all circumstances - an assessment of the anti-competitive effects of the behaviour is a necessary step in deciding if a particular action is prohibited. Nevertheless, the treatment of many types of practice will be relatively clear-cut, since the Condition reflects existing competition law principles, in particular those contained in the EC Treaty. The Guidelines on the operation of the Fair Trading Condition will be revised to take account of and ensure consistency with these guidelines on Network Charge Controls. Until such revisions are made, in case of conflict or inconsistency, the Guidelines on the operation of the Network Charge Controls will take precedence over the Guidelines on the operation of the Fair Trading Condition.
65 Oftel will deal with complaints about unreasonable or anti-competitive behaviour concerning interconnection, in the same way as complaints on other issues. Oftel will seek to resolve issues as quickly as possible - see paragraph 68 below for details on the timescales for conducting an investigation. Oftel will enforce obligations in operator licences, particularly where they concern non-discrimination, transparency and cost orientation and will generally be guided by the following considerations:
Oftel will always attempt to achieve a fair balance between the interests of both parties and the needs of competition.
66 Oftel will specifically take account of the following when resolving a dispute between interconnecting operators:
67 In considering interconnection disputes arising, Oftel will follow its standard procedures for competition casework. The actual information needed will depend on the circumstances. Oftel has powers under all operators' licences to get what information is needed for an investigation. Nevertheless, it helps Oftel considerably if complainants can supply as much information as possible, including:
68 In investigating complaints of anti-competitive behaviour Oftel will adopt the following process: it aims to acknowledge complaints within 5 days, to send a preliminary reply soon after receipt of the complaint and to provide regular reports to complainants on the progress of the ensuing investigation. Investigations have two phases: the Preliminary Enquiry Phase, lasting a maximum of 6 weeks, when initial consideration is given to determine whether there is a case to answer and whether to proceed to a full investigation; and the Investigation Phase, usually lasting no more than a maximum of six months, involving the gathering, analysis and assessment of more detailed information to decide whether enforcement action is needed. The target of the complaint may, however, be given the opportunity to remedy the situation first. Investigations vary in length. Some complaints will be complex to resolve but a successful and speedy resolution is more likely when a complainant provides Oftel with all relevant information. Upon completion of an investigation both the complainant and the complainee are advised of Oftel's findings and an Assessing Complaint Satisfaction questionnaire is sent to ask the complainant to comment on the way its complaint has been handled. These procedures are likely to be developed further in the light of experience.
69 Oftel's principal enforcement tool will be an Order under section 16 of the Telecommunications Act. The procedures for interim and final Orders is set out in the Guidelines on the operation of the Fair Trading Condition.
70 Oftel's general approach to investigations about anti-competitive charging are set out in the Guidelines on the operation of the Fair Trading Condition. Consistent with those Guidelines, Oftel would regard measures of cost floors and ceilings as a good first order test as to whether the charge is in fact anti-competitive or excessive (other factors willalso be taken into account). The methodology which Oftel will use to derive floors and ceilings for inland conveyance services is set out in Appendix III below.
71 Oftel is ready to investigate any reasonable complaint against BT's interconnection charges.
72 In investigating formal complaints about BT's interconnection charges, Oftel will require BT to provide the information necessary for Oftel to test whether the charge is anti-competitive or otherwise abusive. BT will have to maintain and make available to Oftel up-to-date and disaggregated cost information sufficient to justify the reasonableness of charges in the event of an investigation. It will be expected to supply such information to Oftel within two weeks of request. Where appropriate, Oftel may publish or further disclose this information.
73 Oftel published indicative values of floors and ceilings for the inland conveyance services on [date in July 1997]. Oftel will not be re-publishing these values each year. Floors and ceilings will be reviewed in 1999 (mid-way through the charge control period) and updated values for them published. As costs move, so will the level of floors and ceilings and Oftel's published floors and ceilings will therefore cease to represent the current level of BT's costs after publication. The floors and ceilings published by Oftel at the start of the charge control period and at the mid-term review should therefore be regarded purely as indicative.
74 However, as part of its Long Run Incremental Costs Statements, BT will be publishing on an annual basis floors and ceilings for all interconnection services (except competitive services).
75 Complaints to Oftel about BT's charges should be accompanied by as much supporting information as possible. Oftel would expect other operators wherever possible to be able to present a case including analysis of the relevant market, evidence of anti-competitive effect backed by cost information to indicate, for example, the level of the charge in relation to cost floors and ceilings.
76 Oftel would expect operators to be able to make judgements on costs and charges, based on the cost information published by BT and their own experience of operating networks and cost movements, and to provide data to support challenges to BT charges on the basis of this.
77 In assessing any complaint about charges, Oftel may require BT to provide additional cost information suitably updated.
[List to be inserted.]
[NB This text is reproduced from the Draft Determination of Interim Charges for BT's Standard Services for the year commencing 1 April 1997. The text may need to be amended in the light of current discussion in the industry about the NTS formula.]
II.1 The Director General determines that for access to Freefone, Lo-call, National Call and Premium Rate Services, the originating Operator ("ONO") shall pay to BT the Deemed Retail Price for the call on the basis that BT covers the ONO's costs of conveyance of the call over the network of the ONO, by paying the ONO the rate which has been determined by the Director General for conveyance over a single tandem segment of the BT Applicable Systems uplifted by 54% to allow for the ONO's additional retail costs.
II.2 The Deemed Retail Price is:
II.3 This determination does not apply to calls which rely on the Freefone 0800 number to access the telephony services of another Operator or access to 0894-4 (wireplay) or 0898-2 to 0898-9.
(Please note - Figures B.1, B.2 and B.4 are not available at present on this site)
III.1 In general, Oftel would consider a good first order test of whether a charge is anti-competitive or otherwise abusive to be whether the charge in question falls within a floor of long run incremental cost and a ceiling of stand-alone cost. A charge set below the floor could mean that BT was not recovering sufficient of the incremental cost of conveyance from the service and might indicate the possibility of anti-competitive behaviour. A charge set above the ceiling might mean that BT was recovering more than an appropriate share of the full (or stand-alone) costs in providing conveyance, which would indicate possible exploitation of a dominant position in the market for the service.
III.2 In investigating complaints about charges, Oftel would not apply the floors and ceilings test mechanistically. Floors and ceilings are an effective first order test for the likelihood of anti-competitive or exploitative charging. However, there may be circumstances in which charges set outside the band of floors and ceilings are not abusive, or charges set within the band are (see Oftel's Guidelines on the operation of the Fair Trading Condition). If asked to investigate charges, Oftel will seek to analyse the effect of the charge in the relevant market and will take a view on this based on the individual circumstances of each case.
III.3 Floors and ceilings for inland conveyance services are derived using the output of the incremental costs modelling process. (For detailed analysis of the incremental costs methodology, see NERA's report to Oftel, Reconciliation of the Top-Down and Bottom-Up Models published in December 1996.)
III.4 There are two increments in the incremental cost methodology - the whole of conveyance and the whole of access in a stand-alone network of inland PSTN and private circuits. In investigations of charges by Oftel, the floors for the inland conveyance network components will be given by the incremental cost of conveyance, broken down into the costs of network components and expressed on a pence per minute basis. The ceilings will be given by the stand-alone cost of conveyance, broken down into the costs of components and expressed on a pence per minute basis. The stand-alone cost of conveyance is the sum of the incremental cost of conveyance and the common costs between conveyance and access. Figure B.1 demonstrates the relationship between the incremental and stand-alone costs of conveyance. Floors and ceilings for network components are illustrated in Figure B.2.
III.5 The methodology derives floors and ceilings initially in terms of component costs but, to be used as a test for abusive charging, they will be applied to interconnection services (because interconnecting operators purchase services not components). In setting interconnection charges, the use of components in interconnection services is reflected in routing factors. With the approach to floors and ceilings for components set out above, floors and ceilings for services can be derived by applying the appropriate routing factors for the services to the relevant component floors and ceilings as illustrated in Figure B.3.
III.6 For services within charge control baskets, BT's ability to set charges close to the ceiling will be constrained by the requirement for it to comply with the charge control. This is because the control is applied to the incremental cost of conveyance plus a proportion of common costs between access and conveyance apportioned on the basis of equal mark-ups. Ceilings are derived from the stand-alone costs of conveyance, ie the incremental cost plus all of the common costs between access and conveyance. Within a charge control basket, setting one charge near the ceiling (ie with a larger proportion of common costs between access and conveyance) will mean that other charges in the basket will need to be set nearer the floor (ie with a smaller proportion of the common costs between access and conveyance) to meet the requirements of the control.
III.7 Floors - Because floors are intended to prevent excessively low pricing, they should, in principle, reflect BT's incurred costs, since this would provide a more appropriate guideline for anti-competitive low pricing than the incremental cost of an efficient operator.
III.8 Ceilings - Ceilings should reflect the costs of an efficient operator because they are intended to prevent excessively high or exploitative pricing. Purchasers are exploited if they pay charges in excess of the stand-alone costs of an efficient operator. The costs of an efficient operator are calculated by applying the efficiency gap for network costs, derived from the study of BT's efficiency commissioned by Oftel, to the incurred costs. It is expected that the efficiency gap will narrow over the charge control period as BT drives inefficiencies out of its network costs to satisfy the requirements of the charge caps. Oftel's financial modelling will take account of this and will enable Oftel to forecast the efficiency gap at any point in the charge control period.
III.9 Oftel will take account of these principles in deriving floors and ceilings when conducting investigations of BT's interconnection charges.
III.10 It is possible that tensions will arise from the use of incurred costs for floors and the costs of an efficient operator for ceilings. Three examples of this are covered here.
III.11 Floors and Charge Caps - If BT fails to make the necessary cost reductions to keep pace with the RPI-X constraint, the constraint might require BT to set charges below floors measured on the basis of incurred costs. This possibility is a characteristic of all price caps. It is, in practice, extremely unlikely to happen because, for a charge based on incurred costs to fall below a floor, BT would have to underperform the constraint to the extent that it would have negated the equal mark-up (the margin between incremental costs and the starting charges).
III.12 Ceilings and safeguard caps - Services which are likely to become competitive during the charge control period are subject to safeguard caps of RPI+0%. However, because costs will fall over the charge control period, it is possible that ceilings will fall below safeguard caps. However, it should be noted that safeguard caps are neither intended nor expected to be the effective constraints and that they operate as a `failsafe' mechanism to protect customers from excessive charges in the event that services are not as competitive during the charge control period as Oftel has anticipated. Oftel would expect charges subject to safeguard caps to be driven down by competitive pressure. The requirement for charges to be reasonably derived from costs implies that the ceiling should generally take precedence over the safeguard cap if it is lower.
III.13 Ceilings below floors - The costs of an efficient operator could be less than incurred costs for a service (in which case, the ceiling would be below the floor). In such circumstances, Oftel would need to consider the possibility of anti-competitive charging. It would need to make a judgement about whether the ceiling or the floor had precedence. In practice, this situation will be so exceptional that it would merit specific consideration and a hard and fast rule is not appropriate. The floors and ceilings test is not the only test for anti-competitive charging and the judgement would therefore also depend on other relevant considerations.
III.14 Floors and ceilings derived as set out in these guidelines with the increment defined as the whole of conveyance can be contrasted with the average incremental and stand-alone costs which would result from regarding each network component individually as an increment. The definition of the increments in the methodology set out in these guidelines implies that the proposed floor would normally be larger than the average incremental cost of the network component (derived on the basis that each component is an increment) and that the proposed ceiling would normally be smaller than the average stand-alone cost of the component (derived on the basis that the component is the increment).
III.15 This is because, if components were regarded as increments, their costs would be calculated without the common costs within conveyance (ie between components or services) which result from the economies of scope arising from the sharing of facilities by services. However, the stand alone cost of each component regarded as the increment would include all the common costs within conveyance related to that component. If components were regarded as the increment, the sum of the incremental costs of the components would therefore be less than the incremental cost of conveyance by an amount equal to the common costs between components (ie within conveyance). In contrast, the definition of the whole of conveyance as the increment (as the incremental costs methodology does) will mean that the sum of the cost of components is equal to the incremental cost of conveyance because common costs between components are not separately identified. This is illustrated below.
| pence per minute | |||||||
| Local switch | Tandem switch | Junction transmission |
Trunk transmission |
||||
| Link | Length | Link | Length | ||||
| 1 Component floor | o | o | o | o | o | o | |
| 2 Component ceiling | o | o | o | o | o | o | |
| Interconnection service | |||||||
| 3 Local exchange segment | o | o | o | Routing factor (1)x(3)=service floor (2)x(3)=service ceiling |
|||
| 4 Local-tandem conveyance | o | o | o | o | o | Routing factor (1)x(4)=service floor (2)x(4)=service ceiling |
III.16 If components were regarded as increments, floors and ceilings would need to be satisfied not only for each component individually but also for each combination of components where there are common costs between components. So the revenue from any combination of components would need to cover the common costs between the components as well as the incremental cost of each component.
III.17 This combinatorial principle should also be applied for all components taken together, so the rates for all components should generate sufficient revenue to cover the incremental cost of each component and all of the common costs between components (which together make up the incremental cost of conveyance). Oftel's approach of defining the whole of conveyance as the increment would therefore automatically ensure that rates satisfy any combinatorial test (because common costs are already included in the break down of incremental costs to the component level). However, it could be argued that floors set using this methodology are too high because they include a proportion of common costs and will therefore be higher than the incremental cost of a component (where the increment is defined as the component). Oftel would take account of this in investigating complaints about anti-competitive charging.
III.18 It could be argued however that the appropriate theoretical benchmark for floors is more complicated. Since interconnecting operators purchase services, cost information on the basis of interconnection services as increments would be relevant. This would involve a degree of further complexity beyond the scope of the incremental costs methodology developed so far because the incremental costs of services would depend not on the total incremental costs of components, but on the shape of the cost function for each component. To apply the combinatorial tests correctly, it would also be necessary to derive the common costs between each combination of services.
III.19 If estimates of the incremental and stand alone costs of services were produced using a generally accepted robust methodology, such evidence would be taken into account by Oftel in investigating complaints about charges. However, to establish such a methodology would require a substantial amount of work beyond that carried out so far.
C.1 The principle of the routing (or usage) factors to build up interconnection services from components and parts shall apply in the new regime as in the current regime. For each interconnection service, the routing factors give the average usage of network components for all traffic on BT's network.
C.2 Oftel and BT have agreed that, for 1997/98 and subsequent years, BT's financial statements should adopt a new set of inland conveyance components from the set that is currently used. The proposed new set of inland conveyance components is more transparent and unbundled than the current set. Table C.1 shows a comparison of the current and new set of inland conveyance components.
C.3 The main differences are the unbundling of the concentrator from the local switch and the classification of transmission by the type of switches connected, rather than the current junction/trunk classification, which averages the costs of different types of transmission.
C.4 Table C.2 lists the interconnection services that will be included in each of the baskets - call termination and general network - and in safeguard caps, and indicates the inland conveyance components that would be used in each service. In the table and the descriptions of interconnection services, the usage of components relates to the new components, not the components as currently classified by BT. For simplicity, transmission is not sub-divided into link and length (R-L refers to remote-local transmission, L-T to local-tandem transmission and T-T to inter-tandem transmission).
Table C.1 Current and new sets of inland conveyance network components
| Components in Current Regime | Proposed New Components |
| Local exchange | Local switch Concentrator |
| Main and DJ switching | Tandem switch |
| Junction transmission link Junction transmission length |
Remote-local transmission link Remote-local transmission length |
| Trunk transmission link Trunk transmission length |
Local-tandem transmission link Local-tandem transmission length |
| Inter-tandem transmission link Inter-tandem transmission length |
|
| Note: No change is proposed to the DSN switch and DSN transmission link components. | |
Table C.2 Interconnection services in each basket and in safeguard caps
| Switching: |
Transmission: |
|||||
| Concentrator | Local | Tandem | R-L | L-T | T-T | |
| Call termination basket Call termination local exchange segment Call termination local exchange segment (ISDN) See note (1) |
* * |
* * |
* * |
|||
| General network basket Call origination local exchange segment including non-chargeable OA Call origination local exchange segment excluding non-chargeable OA Call origination local exchange segment including non-chargeable OA (ISDN) Call origination local exchange segment excluding non-chargeable OA (ISDN) Local-tandem conveyance Local-tandem conveyance (ISDN) Single transit Single transit to another operator's PRS Single transit to another operator's freephone service Single transit to another operator's local call fee service Single transit to another operator's national call service Single transit (ISDN) See notes (1) and (2) |
* * * * |
* * * * |
* * * * * * * * |
* * * * |
* * |
|
| Safeguard cap Inter-tandem conveyance: up to 100 km Inter-tandem conveyance: 100 to 200 km Inter-tandem conveyance at least 200 km Inter-tandem conveyance (ISDN): up to 100 km Inter-tandem conveyance (ISDN): 100 to 200 km Inter-tandem conveyance (ISDN): at least 200 km Inter-tandem transit: up to 100 km Inter-tandem transit: 100 to 200 km Inter-tandem transit: at least 200 km Inter-tandem transit (ISDN): up to 100 km Inter-tandem transit (ISDN): 100 to 200 km Inter-tandem transit (ISDN): at least 200 km Inter-tandem transit to another operator's PRS: up to 100 km Inter-tandem transit to another operator's PRS: 100 to 200 km Inter-tandem transit to another operator's PRS: at least 200 km Inter-tandem transit to another operator's freephone service: up to 100 km Inter-tandem transit to another operator's freephone service: 100 to 200 km Inter-tandem transit to another operator's freephone service: at least 200 km Inter-tandem transit to another operator's local call fee service: up to 100 km Inter-tandem transit to another operator's local call fee service: 100 to 200 km Inter-tandem transit to another operator's local call fe | ||||||