S.I. No. 393/1996:

TELECOMMUNICATIONS TARIFF REGULATION ORDER, 1996.

TELECOMMUNICATIONS TARIFF REGULATION ORDER, 1996.

I, Alan Dukes, T.D., Minister for Transport, Energy and Communications, in exercise of the powers conferred on me by section 7 of the Telecommunications (Miscellaneous Provisions) Act, 1996 (No. 34 of 1996), hereby order as follows:

1. (1) This Order may be cited as the Telecommunications Tariff Regulation Order, 1996.

(2) This Order shall come into operation on the 1st day of January, 1997.

(3) This Order shall apply to the telecommunications services specified in the First Schedule to this Order and provided by the company.

2. In this Order -

"the Act of 1996" means the Telecommunications (Miscellaneous Provisions) Act, 1996 ;

"basket of telecommunications services" has the meaning assigned to it by Article 3;

"the company" means Bord Telecom Éireann;

"connection and takeover charge" means a charge made by the company for the connection of a customer to the company's networks or to services on the company's networks;

"directory enquiry call" means a call made to the company's directory enquiry service for the purpose of obtaining telephone numbers;

"Integrated Services Digital Network" means a network whereby telephone calls are made over switched end to end digital transmission paths;

"international dialled call" means a dialled call made from a telephone exchange line in the State to a telephone exchange line outside the State other than from a telephone exchange line in the State to a telephone exchange line in Northern Ireland;

"light user scheme" means any discount scheme which has been approved as such by the Minister and which is aimed at certain residential users whose bills for telecommunications services are, in the opinion of the Minister, following consultation with the company, low in monetary terms;

"local dialled call" means a dialled call made from a telephone exchange line in the State to a telephone exchange line in the same telephone group or to a telephone exchange line in another telephone group which is regarded as adjacent to the first-mentioned telephone group;

"lower quartile bill" means a notional bill for telecommunications services which stands specified by the Minister, following consultation with the company and is based on a representative sample of bills imposing charges for a specified period on residential users of such services;

"operator call" means a call which is completed with the assistance of an operator of the company for which a charge is made by the company;

"payphone call" means a call originating from a public telephone owned by the company on public property;

"the provision of Integrated Services Digital Network lines" means a service for which a recurring charge is made by the company for the availability of Integrated Services Digital Network lines and does not include connection and takeover charges;

"the provision of telephone exchange lines" means a service for which a recurring charge is made by the company for the availability of telephone exchange lines and does not include connection and takeover charges;

"relevant year" means any period of 12 months beginning on 1 January;

"trunk dialled call" means a dialled call made from a telephone exchange line in the State to a telephone exchange line in another telephone group in the State or in Northern Ireland which is not a local dialled call;

"weekend trunk dialled call" means a trunk dialled call made -

(a) between the period commencing at midnight on Friday and ending at midnight on the next following Sunday,

(b) on all public holidays, and

(c) at such other times as the company may specify.

3. The telecommunications services set out in the First Schedule to this Order shall be the basket of telecommunications services specified for the purposes of this Order and "basket of telecommunications services" shall be construed accordingly.

4. (1) The Minister hereby specifies ΔCPI 6% to be the price cap in respect of the basket of telecommunications services.

(2) Subject to Article 4(1), the following adjustments to the price cap shall apply:

(a) in the case of the provision of telephone exchange lines, ΔCPI + 0%;

(b) in the case of all other services, ΔCPI + 2%;

(c) in the case of the lower quartile bill, ΔCPI + 0%.

5. (1) The restrictions and adjustments to the price cap formula, set out in Part I of the Second Schedule to this Order, shall be applied for the purpose of determining compliance with the price cap specified in Article 4(1).

(2) The restrictions and adjustments to the price cap formula, set out in Part 2 of the Second Schedule to this Order, shall be applied for the purpose of determining compliance with the adjustment to the price cap specified in Article 4(2)(c).

6. Notwithstanding Article 4 the Minister may make the following adjustments to the price cap formula:

(a) to the extent that the company has made, during any relevant year, reductions which are greater than those required to comply with Article 4(1) of this Order, the difference may be taken into account by the Minister in applying Article 4(1) of this Order in the relevant years subsequent to the relevant year in which the changes were made.

(b) to the extent that the company has made, during any relevant year, increases which are less than those allowed under Article 4(2) of this Order for any individual service in the basket of telecommunications services, the amount by which those increases are less than that permitted under Article 4(2) of this Order may be carried forward and added to the permitted increase for that particular service in the basket of telecommunications services in the next or second subsequent year to the relevant year.

First Schedule

The provision of telephone exchange lines;

The provision of Integrated Services Digital Network lines;

Telephone exchange line and Integrated Services Digital Network connection and takeover;

Local dialled calls;

Trunk dialled calls (except for weekend trunk dialled calls);

Weekend trunk dialled calls;

International dialled calls;

Operator calls;

Directory enquiry calls;

Payphone calls.

Second Schedule

Part I

Where,

n is the total number of services in the basket of telecommunications services;

Δ_i is the percentage change in the tariff (before discounts, except for any light user scheme) for telecommunications service "i" calculated from either:

(i) the base of the tariff pertaining at the end of the year preceding the relevant year, or

(ii) on the basis of a representative sample of bills for the service "i" specified and applied by the company with the consent of the Minister;

Ri is the total revenue before discounts for the telecommunications service "i" in the financial year ending on or about 31 March in the relevant year;

Rt is the overall total revenue before discounts in the financial year ending on or about 31 March in the relevant year for all telecommunications services in the basket.

Part 2

Where,

n is the total number of services in the basket of telecommunications services;

ΔPi is the percentage change in tariff (before discounts, except for any light user scheme) for telecommunications service "i" calculated from either:

(i) the base of the tariff pertaining at the end of the year preceding the relevant year, or

(ii) on the basis of a representative sample of bills for the service "i" specified and applied by the company with the consent of the Minister;

LRi is the amount charged for the telecommunications service "i" in the lower quartile bill in the financial year ending on or about 31 March in the relevant year;

LRt is the overall total charge for all telecommunications services in the lower quartile bill in the financial year ending on or about 31 March in the relevant year.

Given under my Official Seal, this 16th day of December, 1996.

ALAN DUKES

Minister for Transport,

Energy and Communications.

EXPLANATORY NOTE

This order provides a new framework for future changes in Telecom Éireann's telecommunications tariffs. Previously Telecom's Éireann's tariffs were controlled under Section 90 of the Postal and Telecommunications Services Act 1983 which required the consent of the Minister for increases in prices.

The order will cover telecommunications services provided by Telecom Éireann for which there is no competition and for which Telecom Éireann holds a dominant position in the relevant market. These services are grouped into a basket of telecommunications services and are specified in the First Schedule to the Order. The Order places a price cap on Telecom Éireann's tariffs such that there will be an overall downward movement in tariffs which should be at least equal to the annual percentage change in the Consumer Price Index - 6%.

Within this overall cap Telecom Éireann will have flexibility to adjust tariffs although each individual telecommunications service within the basket cannot increase by more than annual percentage change in the Consumer Price Index plus 2%. In addition increases in tariffs will be further restricted by the requirement that the average bill of the low volume user cannot increase by more than the annual percentage change in the consumer price index.

This price cap will apply on an annual basis commencing on 1 January 1997.