Public Consultation: URCA’s Cost Efficiency Study of BTC

February 16, 2012, the Utilities Regulation and Competition Authority (URCA) released for public consultation, a “Cost Efficiency Study of the Bahamas Telecommunications Company Limited (BTC)”, [URCA document reference number ECS 04/2012]. The exercise supports the regulator’s extensive engagement with BTC, electronic communication sector (ECS) participants and the public at large, to establish standards for Reference Access and Interconnection Offers (RAIO) by BTC.

URCA is concerned with both wholesale and retail pricing behaviour of SMPs. BTCs fixed and mobile retail voice services are subject to price regulation. URCA’s cost efficiency exercise is intended to ensure that its regulation of wholesale prices, which will impact charges contained in RAIOs, not only reflects a cost oriented pricing structure, but importantly a pricing structure established on a reasonable base of costs. This standard is necessary to ensure that operational and other inefficiencies are not passed on to other industry participants. In fully competitive markets, prices are commonly equal to the efficient costs of providing those services. Regulation aims to proxy the outcome of competitive markets and therefore seeks to ensure that regulated prices are based on efficient costs.

The study assesses BTC’s relative efficiency performance and recent productivity trends. URCA invites comments on the study generally and also more specifically on the methodology and preliminary results. The study and all above referred documents may be downloaded from the publications section of the URCA website at URCA will receive comments until March 30, 2012.

A PDF copy of the full press release and the Consultation Document may be accessed below.