Big telecoms oppose change to contribution regime threshold, CNOC supports

The Independent Telecommunications Providers Association (ITPA) is seeking to raise the threshold for contribution levies from $10 million to $25 million. It also wants to make the ruling retroactive to the beginning of the year. Established telecoms are against the idea while the Competitive Network Operators of Canada (CNOC) backs the proposal. BCE Inc. takes issue with the ITPA using changes to the Broadcasting Act under the Online Streaming Act to justify the higher threshold. Changes to the landscape of broadcasting necessitated the new law, the telecom giant argued, but is in no way analogous to the situation in telecommunications. Increasing the starting point for collecting contributions would not add any new contributors, Bell maintained. Bigger companies will see an increase in the percentage of fees. “Concentrating fees on larger TSPs was never the intent of the current contribution regime.” the firm wrote. The current plan, implemented in 2000, seeks to spread the burden across various sectors of the market. “For these reasons, the commission should deny the ITPA’s request and maintain current thresholds for contribution and telecommunications fees regulations,” Bell stated. Telus Corp. also came out against the ITPA's suggestion. It wants the status quo to continue. If the regulator does decide to raise the threshold, it should be at no more than $17 million to account for inflation over the past 24 years, the western telecom said. Telus stated the initial purpose of moving contribution from a per-minute regime to a revenue-based model was to give the plan more fairness and equity. “The ITPA now seeks to remove the contribution burden from its members and put it on its competitors,” the company alleged. “This is not fair, equitable, and is inconsistent with the very purpose of the contribution regime that has existed for almost 25 years.” It also attacked the notion that the Broadcasting Act changes justify contribution changes. Making the changes retroactive would require issuing refunds, a cumbersome process. Rogers Communications Inc. did its own inflationary calculations and said if the threshold is to be raised, a move it opposes, it should be in the range of $9.9 million to $15.7 million to account for the decrease in telecom prices over the years and their effect on the consumer price index. It believes all carriers should contribute to the plan. Since the contribution helps fund the CRTC, any reason not to give should be compelling. Data collected by the commission covers the whole sector, not just the large players, Rogers added. Quebecor Inc., parent company of Videotron and Freedom Mobile, is also against the ITPA's application. Along with its Big Three competitors, it dismissed the use of the Broadcasting Act to justify a change in the regime. CNOC, in backing the application, said that many smaller companies that would not have been subject to contribution back in 2000 are now under the umbrella. Increasing the Canadian telecommunications services revenue (CTSR) threshold is needed. “CNOC fully agrees with the ITPA that increasing the minimum CTSR threshold to $25 million is not only eminently reasonable but is in fact necessary to fulfill the original intent of decision 2000-745,” the consortium wrote. “As the ITPA’s application makes abundantly clear, a $25 million threshold would, consistent with the commission’s stated objectives in that decision, appropriately exclude smaller providers from the burdens of participating in the contribution regime and remitting telecommunications fees.” The group said other jurisdictions such as Australia and the United States have raised the level of their contribution totals. The Canadian Telecommunications Contribution Consortium Inc. (CTCC) took no position on the proposed increases. It did, however, reject the notion of retroactivity. It would be complicated as several small players apply for relief. “CTCC respectfully recommends that, if the commission decides to accept the ITPA’s proposal, it be effective from January 1, 2025,” it wrote. – Reporting by Paul Park at ppark@thewirereport.ca

Big telecoms oppose change to contribution regime threshold, CNOC supports

News | June 3, 2024

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Big telecoms oppose change to contribution regime threshold, CNOC supports

News | June 3, 2024

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