Dispute from BT Wholesale against Telewest about reciprocal arrangements for call termination rates

13 May 2005

Complainant: BT Wholesale
Complaint against: Telewest
Case opened: 19 December 2003
Case closed: 16 April 2004
Issue: Agreement for call termination charges
Relevant instrument: Relevant instrument: Ofcom resolved the dispute under Chapter 3 of Part 2 of the Communications Act 2003 for the relevant period from 25 July 2003 onward. To the extent that Ofcom considered the matter retrospectively in relation to any period before 25 July 2003, it did do so under regulation 6 of the Telecommunications (Interconnection) Regulations 1997, by virtue of paragraph 22 of Schedule 18 of the Communications Act 2003.

On 16 April 2004 Ofcom published a Determination under Section 190 of the Communications Act 2003 and a Direction under Regulation 6(6) of the Telecommunications (Interconnection) Regulations 1997 resolving this dispute.

Please see Related Items.

Case Leader: Louise Marriage ( e-mail:louise.marriage@ofcom.org.uk
Case Reference: CW/00710/10/03

Text published when the case was opened

Complainant: BT Wholesale
Complaint against: Telewest
Case opened: 19 December 2003

Update note - 19 March 2004

Ofcom issued a draft Direction and a draft Determination in relation to this dispute on 19 March 2004. The closing date for comments is 2 April 2004. Please see Related Items for further details:

Issue:
BT has submitted a dispute for resolution under s.185 of the Communications Act following a breakdown in negotiations between it and Telewest over a new Reciprocity Agreement for fixed geographic call termination on Telewest's network.

Background:
Oftel's review of fixed geographic call termination markets, which was published on 28 November 2003, found that all network operators are held to have SMP in relation to the termination of calls on their networks. This is because the calling party has no influence over the called party's choice of network (and hence the call termination charge) but is obliged to pay for the cost of the call. If left unchecked, this could potentially allow for a terminating operator to set artificially high call termination charges.

In 1997, operators reached an agreement on reciprocal charging for call termination charges that saw operators' charges calculated on a reciprocal basis to BT's own call termination charges. BT's charges are regulated under the Network Charge Control regime. This Reciprocity Agreement covered the four-year charge control period from 1997 to 2001.

BT issued a new OCCN (operator charge change notice) in July 2001, setting out the charges that would be payable under a proposed new reciprocity agreement that would take effect from 1 October 2001. Telewest rejected the OCCN and negotiations between the two parties since that date have failed to result in agreement on the two issues set out below.

Scope of the dispute:
The Director has been asked by BT to consider:

  • the effective date from which the reciprocity arrangement should be applied; and
  • the circumstances in which Telewest should be entitled to raise a review of the reciprocity agreement with BT, for example if there is a change to Telewest's multi-switched operator status or if there is a significant change in the volume of traffic which is terminated by BT on Telewest's network.

Relevant instrument:
Any direction which the Director may make in respect of the period prior to 25 July 2003, shall be made under Regulation 6 of the Interconnection Regulations 1997, in accordance with paragraph 22(3) of Schedule 18 of the Act.

Any direction which the Director may make in respect of the period from 25 July onwards shall be made under the provisions of Part 2, Chapter 3 of the Communications Act 2003.

Procedural Matters:
Guidance on the resolution of the dispute can be found in the joint statement by Oftel and the Radiocommunications Agency Dispute resolution under the new EU Directives of 28 February 2003. All representations on the scope of the dispute should be submitted to Ofcom by 12 January 2004. Stakeholders interested in the outcome of this dispute should notify Ofcom by 12 January 2004 describing the relevance of the outcome of the dispute to their business. Stakeholders with relevant information and evidence in respect of this dispute should submit this to Ofcom by 19 January 2004.

All representations and evidence should be forwarded by e-mail to louise.marriage@ofcom.org.uk or by post to:

Louise Marriage
Ofcom
Riverside House
2a Southwark Bridge Road
London
SE1 9HA

Case Leader: Louise Marriage (e-mail: Louise.Marriage@ofcom.org.uk)
Case Reference: CW/00710/10/03