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Dispute between BT Wholesale and various communications providers about NTS POLO charges

25 Chwefror 2005

Dispute between: BT Wholesale and various communications providers about NTS POLO charges
Complainant: BT Wholesale
Complaint against: Cable & Wireless, Core Telecommunications Ltd, Easynet, EESCAPE Ltd, Gamma Telecommunications Ltd, GKC Communications Ltd, Networks Direct plc, Norbridge Telecom Ltd, NTL Group Ltd, Opal Telecom Ltd, Pipemedia Ltd, Prodigy Internet Ltd, Rateflame Ltd, Skymaker Ltd, Starcomm Ltd, Swiftnet Ltd, Tele2 UK Communications Ltd (now part of Alpha Telecom), Telecentric Solutions Ltd, Telstra Europe Ltd, Thus plc, Torch Communications Ltd, Totem Communications Ltd, Vodafone Ltd, Zipcom Telecommunications Ltd (now part of Pipex).
Case opened: 28 January 2004
Case closed: 27 May 2004
Relevant instrument: Ofcom resolved the dispute under Chapter 3 of Part 2 of the Communications Act 2003
On 27 May 2004 Ofcom published a Determination under Section 190 of the Communications Act 2003 resolving this dispute.

Click on the link at the bottom of this page.

Case Leader: Adam Kilgour (e-mail: adam.kilgour@ofcom.org.uk
Case Reference: CW/00740/12/03

Text published when the case was opened

Dispute between BT Wholesale and various communications providers about NTS POLO charges

Complainant: BT Wholesale
Complaint against: Cable & Wireless, Core Telecommunications Ltd, Easynet, EESCAPE Ltd, Gamma Telecommunications Ltd, GKC Communications Ltd, Networks Direct plc, Norbridge Telecom Ltd, NTL Group Ltd, Opal Telecom Ltd, Pipemedia Ltd, Prodigy Internet Ltd, Rateflame Ltd, Skymaker Ltd, Starcomm Ltd, Swiftnet Ltd, Tele2 UK Communications Ltd (now part of Alpha Telecom), Telecentric Solutions Ltd, Telstra Europe Ltd, Thus plc, Torch Communications Ltd, Totem Communications Ltd, Vodafone Ltd, Zipcom Telecommunications Ltd (now part of Pipex).
Case opened: 28 January 2004
Relevant instrument: Ofcom intends to resolve the dispute under Chapter 3 of Part 2 of the Communications Act 2003

Update note - 30 April 2004

Ofcom published its proposals to resolve this dispute on 30 April 2004. The consultation document is on the Ofcom website - see Related Items.

Ofcom will be consulting on its proposals until 5pm on 14 May 2004. Please send responses to:

Adam Kilgour
Competition and Markets
Ofcom
Riverside House
2a Southwark Bridge Road
London
SE1 9HA

or by email to Adam.Kilgour@ofcom.org.uk

End of update note

Update note - 19 Feb 2004: progress update on this dispute and Ofcom's expected next steps

Since the dispute was accepted on 28 January, Ofcom has held informal discussions with BT and a number of interested parties in an attempt to better understand the position of each side. During the next 4 weeks Ofcom expects to complete the following steps:

  • send formal data requests to a number of the larger parties involved and receive their responses
  • receive written representations from interested parties who wish to expand on their positions

The deadline for written submissions is being extended from 27 February 2004 (set out in Competition Bulletin entry of 28 January 2004) to Friday 12 March 2004 to provide additional time for smaller players to comment, and to align dates for receipt of all data. The deadline for representations on scope and notification of interest remains 20 February 2004.

Beyond this time period Ofcom expects to perform the following steps:

  • complete its analysis based on data received
  • publish and consult on a draft decision
  • publish a final determination by 28 May 2004

If any interested parties would like to meet with Ofcom, or if there are any other questions, please contact the case leader.

End of update note

Issue:
BT has submitted a dispute for resolution under Chapter 3 of Part 2 of the Communications Act 2003 following the breakdown of negotiations between it and various communications providers over changes in outpayments from NTS calls ('NTS POLO charges').

Background:
On 1 June 2003 BT cut retail geographic prices for local rate weekend & national rate evening calls, also reducing 0845 and 0870 retail prices in line with the geographic price reductions. This in turn lead to a reduction in outpayments ('POLOs') to NTS terminating communications providers (CPs) under the NTS formula. BT initially notified other CPs of revised CP call termination charges for 0845 and 0870 NTS products via a pricing letter on 4 July 2003, but following industry representations issued a revised pricing letter on 24 October 2003 with an effective date of 29 August 2003. It is the contents of this later pricing letter which are now in dispute.

Stakeholders should note several related Ofcom projects which are ongoing:

  • Competition Act investigation - BT 0845 & 0870 retail price change- Suspected Internet Service Provider (ISP) margin squeeze (CW/00647/07/03)
  • 0845 and 0870 numbers: Review of retail price and numbering arrangements
  • NTS Policy Project

Scope:
To determine:

  • whether BT has acted in line with BT's contractual and regulatory obligations in proposing new prices
  • whether the prices proposed are reasonable within the context of BT's regulatory obligations
  • the effective date of the price changes

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. In addition, stakeholders are referred to the forthcoming Ofcom consultation 'Draft Guidelines for the handling of competition complaints, and complaints and disputes about breaches of conditions imposed under the EU Directives.'

All representations on the scope of the dispute should be submitted to Ofcom by 20 February 2004.

Stakeholders interested in the outcome of this dispute should notify Ofcom by 20 February 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 27 February 2004.

Case Leader: Adam Kilgour (e-mail: adam.kilgour@ofcom.org.uk
Case Reference: CW/00740/12/03