1 BEFORE THE ILLINOIS COMMERCE COMMISSION 2 IN THE MATTER OF: ) 3 ) BCE NEXXIA CORPORATION, ) 4 ) No. 03-0410 APPLICATION for a Certificate of ) 5 Interexchange Authority to ) Operate as a Facilities-Based ) 6 Carrier of Telecommunications ) Services throughout the State of ) 7 Illinois )
8 Chicago, Illinois
9 July 15, 2003
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11 Met, pursuant to notice, at 2:00 o'clock p.m.
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13 BEFORE:
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15 MS. EVE MORAN, Administrative Law Judge 16
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1 1 APPEARANCES:
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4 COUDERT BROTHERS LAW FIRM, by MR. WILLIAM K. COULTER and 5 MR. MATTHEW VITALE 1627 I Street NW 6 Washington, D.C. 20006 appearing for applicant. 7
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21 SULLIVAN REPORTING COMPANY, by 22 Leah Ann Bezin, CSR License No. 084-001104
2 1 I N D E X Re- Re- By 2 Witnesses: Direct Cross direct cross Exmnr
3 David Kidd 9 13 26 27
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10 E X H I B I T S 11 Number For Identification In Evidence 12 APPLICANT'S 13 Exhibits A-J 4 28 14 Exhibit K 4 13 15 Late-Filed No. 1 26 28 16
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3 1 JUDGE MORAN: Pursuant to the direction of the
2 Illinois Commerce Commission, I call
3 Docket 03-0410.
4 This is BCE, all caps, Nexxia,
5 N-e-x-x-i-a, capital N, Nexxia, Corporation.
6 It is an application for a certificate
7 of interexchange authority to operate as a
8 facilities-based carrier of telecommunications
9 services throughout the State of Illinois.
10 My I have the appearances for the
11 record, please.
12 MR. COULTER: Yes.
13 Your Honor, my name is Bill Coulter, and
14 I'm a partner with Coudert Brothers. And Coudert
15 Brothers' office is located at 1627 I Street NW,
16 Washington, D.C. 20006. And my telephone number
17 is (202) 736-1811.
18 Your Honor, with me today also is
19 another attorney from Coudert Brothers,
20 Matthew Vitale. And I'll spell that last name,
21 V-i-t-a-l-e. And he is joining me as counsel. .
22 And he was cosigner of the application.
4 1 JUDGE MORAN: Okay. Thank you, Mr. Coulter.
2 This proceeding is being conducted
3 through telephone.
4 And I have before me an application
5 completed by BCE Nexxia signed by
6 Martine Turcotte, secretary of the company.
7 Within that application, I see a number
8 of exhibits. Those are Exhibits A through K. Am
9 I right, or --
10 MR. COULTER: Yes, that's correct.
11 JUDGE MORAN: Okay. And is anybody going to
12 testify?
13 MR. COULTER: Yes, your Honor.
14 Mr. David Kidd will be testifying for
15 BCE Nexxia Corporation.
16 JUDGE MORAN: Mr. David Kidd. And he's there
17 with you?
18 MR. COULTER: Yes, he is.
19 JUDGE MORAN: Okay. I'm going to swear in
20 Mr. Kidd.
21 (Witness sworn.)
22 JUDGE MORAN: And, Mr. Coulter, are you
5 1 prepared to elicit testimony from your witness?
2 MR. COULTER: Yes, we are prepared to call the
3 witness and to elicit testimony from him, your
4 Honor.
5 JUDGE MORAN: Okay.
6 You can proceed.
7 MR. COULTER: Thank you, your Honor.
8 We have one witness, your Honor. His
9 name is Mr. David Kidd. And his last name is
10 spelled K-i-d-d. He is the vice president,
11 regulatory for BCE Nexxia Corporation, the
12 applicant --
13 JUDGE MORAN: Okay.
14 MR. COULTER: -- before the Commission at this
15 time.
16 Mr. Kidd's address is 105 H -- Hotel,
17 H-o-t-e-l, space, D-e, space, V-i-l-l-e,
18 Room 6005, Hull, H-u-l-l, Quebec, Q-u-e-b-e-c,
19 and the code is JAX-4H7.
20 Mr. Kidd, in addition to being the
21 vice president, regulatory for BCE Nexxia, is
22 also the vice president of regulatory affairs for
6 1 Bell Canada, and he is an officer of BCE Nexxia
2 Corporation.
3 With Mr. Kidd today is also
4 Mr. Robert Tritt, T-r-i-t-t. He is the director
5 of international trade and regulation for
6 Bell Canada.
7 We will not be calling Mr. Tritt as a
8 witness today as he is not an official of BCE
9 Nexxia Corporation but of the parent company,
10 Bell Canada.
11 JUDGE MORAN: Okay.
12 You mentioned three different
13 corporations when you were talking about
14 Mr. Kidd.
15 Could you give me the relationship
16 between the three?
17 MR. COULTER: BCE Nexxia Corporation is the
18 applicant.
19 JUDGE MORAN: Yes.
20 MR. COULTER: And Bell Canada is the parent
21 company in Canada.
22 JUDGE MORAN: Okay. And was there another
7 1 company mentioned?
2 MR. COULTER: No. I --
3 JUDGE MORAN: Okay.
4 MR. COULTER: If I did, it was in error.
5 JUDGE MORAN: Okay. And that's Bell Canada
6 Enterprises, Inc.?
7 MR. COULTER: Yes.
8 JUDGE MORAN: Okay. Thank you.
9 MR. KIDD: Your Honor, may I speak to the --
10 MR. COULTER: Please.
11 MR. KIDD: Just to clarify --
12 JUDGE MORAN: Who is speaking?
13 MR. KIDD: David Kidd.
14 JUDGE MORAN: Okay.
15 MR. KIDD: Your Honor, I just want to clarify
16 the corporate structure.
17 BCE, Inc., which is the holding company,
18 is the publicly traded company in Canada.
19 JUDGE MORAN: Okay.
20 MR. KIDD: And it is -- Bell Canada, which is
21 the ILEC, the incumbent carrier, in Canada is
22 wholly owned by BCE, and BCE Nexxia Corporation
8 1 is wholly owned by Bell Canada.
2 JUDGE MORAN: Thank you.
3 MR. COULTER: And this is all set forth in our
4 application.
5 JUDGE MORAN: Okay. Thank you so much.
6 And you can proceed, Counsel.
7 MR. COULTER: Thank you.
8 DAVID KIDD,
9 called as a witness herein, having been first
10 duly sworn, was examined and testified as
11 follows:
12 DIRECT EXAMINATION
13 BY
14 MR. COULTER:
15 Q. Mr. Kidd, we have already given your name
16 and address, but I wonder if you could give us
17 your title with BCE Nexxia Corporation one
18 additional time.
19 A. Yes.
20 I am vice president, regulatory and an
21 officer of BCE Nexxia Corporation.
22 Q. And could you briefly describe, for the
9 1 record, your background and your qualifications.
2A.Yes.
3 For over the past 24 years, I have
4 practiced law in telecommunications regulation on
5 behalf of Bell Canada.
6 And I am -- I also hold a position of
7 vice president, regulatory for Bell Canada. And
8 in that capacity, I have had experience in a
9 wide-ranging fashion relating to Canadian
10 telecommunications law and practice.
11 In addition, my practice extends to
12 antitrust law in Canada, and I also advise
13 Bell Canada in that capacity as well as the other
14 affiliates, BCE, BCE Nexxia Corporation and
15 various other affiliates in the BCE group of
16 companies.
17 Q. Thank you.
18 Mr. Kidd, are you applying now for a
19 certificate to become an interexchange
20 facilities-based provider of telecommunications
21 in Illinois?
22 A. Yes, I am.
10 1 Q. And do you have today with you a copy of
2 the document entitled The Prefiled Testimony of
3 Martine Turcotte --
4 A. Yes, I have.
5 Q. Okay.
6 A. Yes, I have.
7 Q. And do you have today with you a copy of
8 the application which BCE Nexxia filed on June
9 23rd --
10 A. Yes, I do.
11 Q. -- I'm sorry -- in Docket 0410?
12 A. Yes, I do.
13 Q. And are you familiar with both the
14 prefiled testimony and with the application?
15 A. Yes, I am.
16 Q. And were they either prepared by you or
17 under your direction?
18 A. Yes, they were.
19 Q. Do you adopt and ratify the testimony of
20 Martine Turcotte as though it were your own?
21 A. Yes, I do.
22 Q. And if we were to ask you the questions
11 1 that are contained in those documents today,
2 would your answers be the same?
3 A. All except the ones describing
4 Martine Turcotte, yes.
5 Q. Thank you.
6 Would you like to make any other
7 corrections other than the change of
8 Martine Turcotte?
9 A. No, I would not.
10 MR. COULTER: At this time, your Honor, I have
11 no further questions of this witness.
12 I would like to request that this
13 testimony be received in evidence as if it was
14 provided orally today by Mr. Kidd.
15 JUDGE MORAN: Okay. So you are moving for the
16 admission of the testimony, the prefiled
17 testimony of Martine Turcotte, which is now being
18 adopted as the testimony of Mr. Kidd?
19 MR. COULTER: That is correct, your Honor.
20 JUDGE MORAN: Okay.
21 That motion is granted, and the
22 testimony will be admitted.
12 1 MR. COULTER: Thank you, your Honor.
2 (Whereupon, Applicant's Exhibit K
3 was admitted into
4 evidence.)
5 CROSS EXAMINATION
6 BY
7 JUDGE MORAN:
8 Q. Mr. Kidd, you are requesting certain
9 waivers in your application?
10 A. Yes, we are.
11 Q. Okay. And those are a waiver of Part 7.10
12 and Part 7.35; am I correct?
13 A. That is correct.
14 Q. Okay. And you're also requesting
15 permission to keep your books and records outside
16 of Illinois?
17 A. Yes, we are.
18 Q. And where would you be keeping your books
19 and records?
20 A. They would be kept in Montreal, Quebec,
21 Canada.
22 Q. In the event that the Commission, this
13 1 Commission, the Illinois Commerce Commission,
2 requires to see anything in those books and
3 records, are you willing to bring them in at your
4 own expense into Illinois?
5 A. Yes, we are.
6 Q. Okay. Can you also tell me, is BCE Nexxia
7 Corporation -- this is a Delaware corporation; am
8 I correct?
9 A. That is correct.
10 Q. Are you authorized to do business in any
11 other state?
12 A. Yes.
13 Q. Providing telecommunications services, of
14 course?
15 A. Right. Yes, we are.
16 Q. And can you --
17 A. And we have applications pending, your
18 Honor, as well in other states. But in some
19 states, we are already authorized.
20 Q. Okay. Can you tell me where you were
21 already authorized?
22 A. I'll just have to consult with Mr. Tritt
14 1 on that.
2 Q. Okay. That will be fine. Take your time.
3 MR. COULTER: Mr. Kidd.
4 THE WITNESS: Yes.
5 MR. COULTER: Are you authorized now to
6 provide service in the state of New York?
7 THE WITNESS: Yes, I believe we are.
8 MR. COULTER: That is what our records show --
9 THE WITNESS: Yes.
10 MR. COULTER: -- your Honor.
11 We have filed applications in as many as
12 15 other states --
13 JUDGE MORAN: Okay.
14 MR. COULTER: -- for which those have not been
15 granted or are pending, and we are not providing
16 service yet in any of those states, Mr. Kidd?
17 THE WITNESS: That is correct.
18 I'm just refreshing my memory here
19 looking down the list, but I accept Mr. Coulter's
20 advice in that regard and I treat it as my own
21 testimony that we are granted authority in
22 New York, others are pending, and no service is
15 1 granted where we have not received authority.
2 JUDGE MORAN: Q Okay. Where you have been
3 authorized to provide service in New York, have
4 you already started to provide service there?
5 MR. COULTER: No.
6 THE WITNESS: We have not.
7 THE WITNESS: No.
8 JUDGE MORAN: Okay.
9 THE WITNESS: No. No, we have not.
10 JUDGE MORAN: Q All right.
11 And you indicate that you have
12 applications pending in how many other states.
13 A. I think there are about 17. But I would
14 just consult with Counsel here who would know
15 better how many.
16 MR. VITALE: Your Honor, this is
17 Matthew Vitale.
18 It's approximately 17 states.
19 JUDGE MORAN: Okay. And an estimate is fine
20 for me.
21 MR. COULTER: That is an estimate, your Honor.
22 We are in the process of applying in a number of
16 1 states. Some already have been accepted and some
2 are pending and some have been granted.
3 JUDGE MORAN: Okay.
4 Q. Now, can you give me some idea of the
5 technical support that Nexxia has to provide
6 service?
7 A. Well, most of our technical support will
8 be coming from underlying carriers on a resale
9 basis. But in addition, we have, of course, the
10 technical support from Bell Canada, the
11 wholly-owned parent, who is a very large provider
12 of telecommunications services in Canada.
13 So between the underlying carriers in
14 the United States and the technical support
15 provided by the parent company for software and
16 intellectual property, billing and that sort of
17 thing, that is where we gain our expertise.
18 Q. Okay. And you are able to draw on the
19 resources of Bell Canada for technical
20 assistance? Is that what you are saying?
21 A. That's correct.
22 Q. What about managerial staffing?
17 1 A. The managerial staffing is predominantly,
2 if not exclusively, either loan resources or
3 people in Bell Canada that provide that
4 assistance to BCE Nexxia Corp.
5 JUDGE MORAN: Q Okay. But does Nexxia have
6 its own managerial staff.
7 A. Not at this time. We have no staff in the
8 United States.
9 Q. Will you have any staff in the
10 United States?
11 A. There are no plans at the present time.
12 We have a 1-800 number for access for any
13 questions that might arise in terms of service,
14 but the nature of the business that we are in,
15 which is predominantly, if not exclusively, large
16 business customers with offices in Canada, we
17 don't anticipate staffing in the United States at
18 this time.
19 Q. I see. Okay.
20 Financial resources. Run me through
21 some of your finances.
22 A. Yes.
18 1 At Exhibit H to the prefiled testimony,
2 we have provided copies of the financial
3 capability of BCE Nexxia. And as a wholly-owned
4 affiliate of BCE, BCE has a $20 billion, roughly,
5 in terms of annual revenue, $7-1/2 billion
6 Canadian -- these are Canadian figures, your
7 Honor --
8 JUDGE MORAN: Um-hmm.
9 THE WITNESS: -- in EBITDA, and, therefore,
10 BCE, being a wholly-owned affiliate -- BCE Nexxia
11 Corp, being a wholly-owned affiliate, will be
12 supported financially by BCE, Inc., in any of its
13 endeavors in the State of Illinois.
14 Q. Okay. You have not begun offering
15 services in New York.
16 Has BCE Nexxia -- does it operate at all
17 in Canada?
18 A. No, it does not.
19 Q. So this subsidiary will only be operating
20 in the United States?
21 A. That's correct.
22 Q. So in that -- to that extent, you have no
19 1 history of compliance with rules and regulations
2 of any other state Commission?
3 A. Right.
4 Q. With that, I'm going to ask you if, in
5 fact, BCE Nexxia intends to comply with all the
6 rules and regulations of this Commission.
7 A. Yes, it does.
8 Q. Okay. Is there anything you can tell me
9 further?
10 A. BCE Nexxia Corporation is a valid
11 Section 214 license holder with the Federal
12 Communications Commission, and we are
13 incorporated in the state of Delaware, and we
14 will fully comply with any other requirements
15 that the state or your Honor requests.
16 Q. Okay. And are you authorized by the
17 Secretary of State to do business in Illinois?
18 A. Yes, that's correct. We are authorized by
19 the -- that's also prefiled in our testimony.
20 Q. Right.
21 Can you or Counsel run me through, very
22 quickly, your Exhibits A through K?
20 1 THE WITNESS: Counsel?
2 MR. COULTER: Yes, your Honor.
3 This is Bill Coulter again.
4 JUDGE MORAN: Yes.
5 MR. COULTER: I will just walk you through
6 them very quickly.
7 JUDGE MORAN: Yes.
8 MR. COULTER: Exhibit A, we have a list of our
9 contact points for the United States services.
10 It includes consumer contact points. It consumes
11 technical service. And, of course, Bell Canada
12 intends to file a tariff as well in the State of
13 Illinois and contact points for that as well.
14 JUDGE MORAN: Okay.
15 MR. COULTER: Exhibit B is from the Secretary
16 of State, and it is a copy of our authorization
17 to do business and certificate to do business in
18 the State of Illinois.
19 The following exhibits behind that will
20 trace for the Court the different companies that
21 have been merged into and have been acquired by
22 to form BCE Nexxia Corporation, as well as a
21 1 certificate of corporations of all those
2 companies.
3 Exhibit D, your Honor, is a list of the
4 directors and officers of BCE Nexxia Corporation
5 including, you will see, Martine Turcotte who is
6 the secretary, which also filed the application.
7 Exhibit E, your Honor, is a description
8 of our billing procedures for future purposes.
9 It describes our dispute provisions which we will
10 be putting into our tariff as well as how billing
11 does occur. As an attachment to that as well is
12 a draft or a proposed copy of a billing data
13 sheet.
14 Exhibit H (sic), your Honor, is our
15 internal compliant procedures for difficulties
16 for customers as to who they will call, the
17 existence of a 24-hour service number, and other
18 types of procedures which are compliant with the
19 state of Illinois' requirements in that regard.
20 It also includes a procedures to prevent slamming
21 provision.
22 Exhibit H is a demonstration of our
22 1 financial capabilities, which is an audited
2 financial statement from the parent company for
3 BCE Nexxia Corporation showing the funding and
4 that it has the financial capabilities to operate
5 in the United States.
6 Exhibit I is a description of the
7 facilities which Bell/Nexxia plans to have in the
8 United States. And, as you can see for that, the
9 underlying carriers for the resale services,
10 which is how Bell/Nexxia will start, are from
11 traditional wire line carriers authorized in the
12 United States and in the State of Illinois.
13 Exhibit J is a list of the proposed
14 services which BCE Nexxia plans to provide in the
15 United States as well as internationally to its
16 customers. Those will be the services which will
17 ultimately be shown in the tariff which we will
18 file with the state. They are traditional
19 services. There are no prepaid services
20 contemplated at this time.
21 And Exhibit K is the prefiled testimony,
22 now the testimony of David Kidd.
23 1 JUDGE MORAN: Okay. And is it your intent to
2 have Exhibits A through K, including the revision
3 as to the adoption by Mr. Kidd of the prefiled
4 testimony, is it your intent to have all those
5 matters admitted into the record?
6 MR. COULTER: Yes, it is, your Honor.
7 JUDGE MORAN: Okay. And you are asking that I
8 consider them?
9 MR. COULTER: Yes, that is correct, your
10 Honor.
11 JUDGE MORAN: Okay.
12 I believe I am through with all my
13 questions.
14 Is there any statement that BCE Nexxia
15 wishes to make?
16 MR. COULTER: Your Honor, I'd like to make, if
17 I may, a simple question or statement.
18 JUDGE MORAN: Sure.
19 MR. COULTER: I'd like to just confirm for the
20 record that when Mr. Kidd was making his
21 description of the states in which
22 Bell Canada -- or Bell/Nexxia had applied for
24 1 services --
2 JUDGE MORAN: Um-hmm.
3 MR. COULTER: -- was providing services or was
4 contemplating providing services, he was acting
5 from memory. And if you'd like us to confirm any
6 of that, we'd be happy to.
7 JUDGE MORAN: Okay. Yes. In fact, that would
8 be great, if you can give me a listing of where
9 BCE Nexxia is authorized, in the event that it is
10 in any other state other than New York, and where
11 applications are pending, and I will treat that
12 as, and you can label it as, BCE Nexxia
13 late-filed Exhibit A -- or wait. Maybe we should
14 call it something else.
15 How about late-filed Exhibit No. 1?
16 MR. COULTER: That would be perfect, your
17 Honor. We will do that.
18 (Whereupon, Applicant's late-filed
19 Exhibit No. 1 was
20 indicated to be marked
21 for identification.)
22 JUDGE MORAN: Thank you so much.
25 1 MR. COULTER: One last question, if I could,
2 for Mr. Kidd.
3 JUDGE MORAN: Sure.
4 REDIRECT EXAMINATION
5 BY
6 MR. COULTER:
7 Q. In your opinion, Mr. Kidd, is granting
8 your application in the public interest for the
9 State of Illinois?
10 A. Yes, it is.
11 MR. COULTER: Thank you very much.
12 That finishes my questions, your Honor.
13 JUDGE MORAN: Okay. And that opened up the
14 door.
15 RECROSS EXAMINATION
16 BY
17 JUDGE MORAN:
18 Q. And why do you say that, Mr. Kidd?
19 A. Because I believe that there are customers
20 in the State of Illinois that will have
21 competitive service from BCE Nexxia Corporation
22 to provide good quality service to the customers
26 1 in the State of Illinois at competitive rates.
2 JUDGE MORAN: Thank you very much.
3 (Witness excused.)
4 JUDGE MORAN: Yes, we can mark the record
5 heard and taken.
6 I'm admitting all the exhibits. That
7 would be Exhibits A through K and their
8 late-filed Exhibit No. 1.
9 (Whereupon, Applicant's Exhibit No.
10 A-J were admitted into
11 evidence.)
12 (Whereupon, Applicant's late-filed
13 Exhibit No. 1 was
14 admitted into evidence.)
15 JUDGE MORAN: Anything else you need from us?
16 MR. COULTER: Thank you, Judge Moran. We
17 appreciate it.
18 JUDGE MORAN: Okay.
19 HEARD AND TAKEN
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