Tue | Nov 20, 2018

FLOW loses appeal to delay new termination fixed-line rates - OUR

Published:Friday | March 30, 2018 | 1:03 PM

The Telecommunications Appeal Tribunal has dismissed an appeal brought by Cable and Wireless Jamaica Limited (CWJ), which trades as FLOW, to have the Office of Utilities Regulation (OUR) delay the implementation of new termination rates for fixed-line services.

The judgment, which was delivered on Wednesday, March 28, affirmed the OUR’s decision regarding the implementation schedule for the new fixed termination rates, which would see a reduction in the cost to terminate calls on CWJ’s fixed network.

The OUR, in June last year, after consultation with the telecommunications industry, had determined that based on the results of a long run incremental cost model, fixed termination rates should be reduced.

The OUR also determined that the reduced fixed termination rates derived from the model would be implemented by way of a two-step six month glide path, with the first reduction in rates to take effect July 1, 2017. The second and final reduction was scheduled to take effect January 1 this year.

CWJ then asked the OUR to reconsider its decision on the implementation of the new rates, and specifically that the new rates be implemented over a three year period, instead of six months. The OUR delayed the implementation of the first reduction in rates scheduled for  July 2017 to allow time to reconsider its decision.

After further consultation with the telecommunications industry, the OUR upheld its decision to implement the new rates on a six-month glide path.

In the reconsideration, the first reduction was rescheduled to take effect as of October 1, 2017, with the second and final reduction scheduled for April 1 this year.

CWJ then sought permission to apply for a judicial review of the OUR’s decision in the Supreme Court. This caused a further delay in the implementation of the first rate reduction. The company was unsuccessful in its application to the Court and the first reduction in rates was implemented December 1 last year.

CWJ appealed the OUR’s reconsideration decision to the Telecommunications Appeal Tribunal. The appeal was heard on February 26 and the Tribunal, in delivering its judgment, dismissed CWJ’s appeal and upheld the OUR’s decision.