237.59 CLASSIFICATION OF COMPETITIVE SERVICE; HEARING.
Subdivision 1.
Emerging competitive service. (a) The following services provided by
the telephone company are subject to emerging competition unless and until reclassified as
noncompetitive or subject to effective competition under this section:
(1) apartment door answering services;
(2) automatic call distribution;
(3) billing and collection services;
(4) call waiting, call forwarding, and three-way calling services for businesses with three
or more lines;
(5) central office-based pricing packages providing switched business access lines which
substitute for private branch exchange systems which may or may not share intelligence with
customer premises equipment;
(6) command link-type services for network reconfiguring to rearrange cross-connections
between channel services;
(7) custom network services and special assemblies;
(8) digicom switchnet services for full duplex, synchronous, information transport;
(9) direct customer access services for telephone number information;
(10) teleconferencing services;
(11) inter-LATA and intra-LATA message toll service;
(12) inter-LATA and intra-LATA private line services;
(13) inter-LATA and intra-LATA wide area telephone service;
(14) mobile radio services;
(15) operator services, excluding local operator services;
(16) public pay telephone services, excluding charges for access to the central office;
(17) special construction of facilities;
(18) systems for automatic dialing; and
(19) versanet-type service access line involving continuous monitoring and transmission of
data from customer's premises to the central office.
(b) A service classified as subject to emerging competition before June 1, 1994, retains that
classification unless and until it is reclassified pursuant to subdivision 3 or 10.
Subd. 1a.
CLASS service. Notwithstanding the terms of subdivision 1, paragraph (b),
CLASS services may be classified as competitive services only when so classified according to
subdivision 3 or 10.
Subd. 2.
Petition. (a) A telephone company, or the commission on its own motion, may
petition to have a service of that telephone company classified as subject to effective competition
or emerging competition. The petition must be served on the commission, the department, the
Office of the Attorney General, and any other person designated by the commission. The petition
must contain at least:
(1) a list of the known alternative providers of the service available to the company's
customers; and
(2) a description of affiliate relationships with any other provider of the service in the
company's market.
(b) At the time the company first offers a service, it shall also file a petition with the
commission for a determination as to how the service should be classified. In the event that no
interested party or the commission objects to the company's proposed classification within 20
days of the filing of the petition, the company's proposed classification of the service is deemed
approved. If an objection is filed, the commission shall determine the appropriate classification
after a hearing conducted pursuant to section
237.61. In either event, the company may offer the
new service to its customers ten days after the company files the price list and incremental cost
study as provided in section
237.60, subdivision 2, paragraph (f).
(c) A new service may be classified as subject to effective competition or emerging
competition pursuant to the criteria set forth in subdivision 5. A new service must be regulated
under the emerging competition provisions if it is not integrally related to the provision of
adequate local service or access to the telephone network or to the privacy, health, or safety of the
company's customers, whether or not it meets the criteria set forth in subdivision 5.
Subd. 3.
Expedited proceeding. An interested party wishing to contest the change of
classification of a service must file an objection with the commission within 20 days after the
filing of the petition. If no party files an objection, the service must be reclassified in accordance
with the petition. If a petition is contested, a telephone company that is the subject of a petition
under subdivision 2 may request that the commission determine the classification of the service
through an expedited proceeding under section
237.61 or a contested case hearing. If an expedited
proceeding is requested, the commission must provide interested persons an opportunity to
comment on the appropriateness of the process and the merits of the petition.
When an expedited proceeding is requested, the commission shall make a final determination
within 60 days of the date on which all required information required under subdivision 2 is filed,
unless during the 60 days the commission finds that a material issue of fact is in dispute, in which
case it shall order that a contested case hearing be conducted to evaluate the petition.
Subd. 4.
Contested case hearing. If a contested case hearing is held under this section, the
commission shall make a final determination on the petition within eight months from the date
the petitioning party requests a contested case hearing or from the date the commission orders a
contested case hearing under subdivision 3. When a contested case hearing is requested in the
petition or when the commission acts on its own motion, this deadline may be extended for no
more than 60 days by agreement of all parties or by order of the commission if the commission
finds that the case cannot be completed within the required time and that without an extension
there is substantial probability that the public interest will be harmed.
Subd. 5.
Criteria. (a) If a proposed classification is objected to pursuant to subdivision
2, paragraph (b), on the basis that the service does not meet the criteria of this subdivision,
the commission shall consider, in determining whether a service is subject to either effective
competition or emerging competition from available alternative service providers, the following
factors:
(1) the number and sizes of alternative providers of service and affiliation to other providers;
(2) the extent to which services are available from alternative providers in the relevant
market;
(3) the ability of alternative providers to make functionally equivalent or substitute services
readily available at competitive rates, terms, and conditions of service;
(4) the market share, the ability of the market to hold prices close to cost, and other economic
measures of market power; and
(5) the necessity of the service to the well-being of the customer.
(b) In order for the commission to find a service subject to effective competition alternative
services must be available to over 50 percent of the company's customers for that service.
(c) In order for the commission to find a service subject to emerging competition alternative
services must be available to over 20 percent of the company's customers for that service.
Subd. 6.
Burden of proof. The classification of a service may not be changed so as to
result in lessened regulation unless it is demonstrated by a preponderance of the evidence that
the criteria of subdivision 5 have been met.
Subd. 7.[Repealed,
1993 c 268 s 6]
Subd. 8.
Interim relief. A telephone company that has a petition pending before the
commission under this section to declare a service competitive may decrease its price for that
service without notice while the commission considers the petition. A company must provide
an incremental cost study if requested by the commission. The commission shall suspend a
company's right under this subdivision to decrease rates if, after an expedited hearing conducted
under section
237.61, the commission finds that the service is being priced below cost, or that
the company has within the previous 12 months charged customers interim rates under this
subdivision for the same service, and that service was determined by the commission to be
noncompetitive.
Subd. 9.
Reporting requirements; exception. A telephone company that offers only
competitive services is not subject to the accounting and reporting requirements of this chapter
unless otherwise ordered by the commission for good cause. A telephone company that offers both
competitive and noncompetitive services is not subject to the reporting requirements with regard
to its effective competition services unless otherwise ordered by the commission for good cause.
Subd. 10.
Regulation reinstated. (a) The commission, on its own motion or upon complaint,
shall reclassify a service as noncompetitive or as subject to emerging competition and reinstate,
in whole or in part, rate regulation of the service if, after notice and hearing, the commission
finds either:
(1) that the competitive market for that service, on review of the criteria found in subdivision
5, has failed so that rate regulation of that service is necessary to protect the interest of consumers,
that it has considered the alternatives to rate regulation, and that the benefits of rate regulation
outweigh the burdens of rate regulation; or
(2) that unreasonable discrimination has occurred between different areas of the state.
(b) In any proceeding to reclassify a service the person initiating the complaint has the
burden of proving that the existing classification is inappropriate, except the telephone company
providing the service has the burden of proving that the classification is appropriate when the
proceeding is commenced by the commission on its own motion or when the complainant is the
department or the attorney general.
History: 1987 c 340 s 3; 1989 c 74 s 9-12; 1994 c 534 art 1 s 5-9; 1Sp2001 c 4 art 6 s 68