Cable Bahamas (CBL) has urged the Utilities Regulation and Competition Authority (URCA) to take a "proactive approach" to "tariff rebalancing" by Bahamas Telecommunications Company (BTC) and to introduce a single consistent "calling party pays" (CPP) pricing regime.
In a consultation document issued yesterday by URCA, with respect to its proposed changes to the rules governing retail prices for BTC and Cable Bahamas, URCA notes comments received from the telecoms providers with respect to pricing.
Of those which fell "outside of the remit" of the pricing review in which URCA is now engaged, the authority said Cable Bahamas' claims that BTC's tariff rebalancing is a "long outstanding regulatory issue which URCA should take proactive measures to address" is one such concern.
Noting Cable Bahamas' concerns nonetheless, URCA said: "CBL believes URCA's involvement in a tariff rebalancing exercise for BTC would engender greater certainty for customers and would further the sector policy objectives."
However, URCA said that rules on tariff rebalancing are all outside of the remit of its present review as do calls from Cable Bahamas for retail prices to be based on a "calling party pays" regime.
"URCA accepts that it has a significant role to play in any tariff rebalancing strategy for BTC. However, concerns over rebalancing go well beyond the retail pricing rules. URCA considers that CBL's proposal is more appropriate with the introduction of price caps and does not believe it is reasonable for URCA to provide guidance in the rules on tariff rebalancing.
"CBL (also) recommends the adoption of a single consistent 'calling party pays' pricing regime, which would be in line with international best practice and also in the best interest of the Bahamian public. CBL notes that other countries have benefitted from similar moves to a single pricing regime. URCA also considers that CBL's proposal for retail prices to be based on a single consistent CPP regime is similarly outside the scope of this consultation."
Proposing to "address concerns raised" by the two telecoms providers over how pricing rules function, URCA notes that BTC's primary concerns in this regard are that there is exercise of regulatory forbearance; greater reliance on ex-competition powers; greater transparency of the approval process; predictability and "greater pricing flexibility.
On Cable Bahamas' part, the BISX-listed provider suggested it was most concerned that existing price regulations are "not efficient and proportionate", are not subject to a "clearly defined set of objectives", that "price cap regulation" should be considered and that there is a streamlining and reduction of ambiguity relating to rules with respect to the pricing of telecoms services.
URCA accepted some of the company's concerns, but rejected others.
Competition provisions
In a consultation published on the regulator's website, URCA said that while it recognized BTC's call for "greater reliance on ex-post (after the fact) competition provisions", it stated that it believes there is a "need for pre-emptive or ex-ante measures to safeguard competition and the protection of consumer interests".
"While BTC does not presently face competition in the mobile market, URCA considers that it is still important that adequate ex-ante safeguards are in place to guard against BTC engaging in practices that foreclose the market upon the introduction of mobile competition," said URCA.
URCA, the regulator for the two entities, said that the proposed revision of the retail pricing rules set out in April 2010 is intended to provide clarity and further guidance to the industry, to benefit those in The Bahamas with respect to the electronic communications sector, and to ensure that the rules process and requirements remain "compliant with the Communications Act".
Services provided by the two companies which are subject to the pricing rules include fixed telephone service and local calling, domestic long distance fixed calling, domestic calls to rated numbers, outgoing international long distance fixed calling, mobile access, local mobile calling, domestic long distance mobile calling, international long distance mobile calling, mobile data, and for CBL, SuperBasic TV service.
The regulatory authority is proposing to clarify information required for applications to change prices by the two operators, and to seek approval for new services in price regulated markets.
It also intends to revise the approach for assessing promotional exercises to "increase flexibility" offered to operators while ensuring that URCA can "still prevent anti-competitive promotions".
Meanwhile, the review intends to address issues such as what constitutes a "new service" being offered and issues relating to "non-price terms" such as contract length.
BTC and Cable Bahamas, along with others who may have an interest in the rules, are invited to respond to the outcome of URCA's consultation with the sector and its proposed changes to the retail pricing rules by December 6.
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