Having approved the second rebalancing phase of Romtelecom’s retail tariffs, in the second half of 2004, ANRC continued the discussions with this operator on the manner of performing the third tariff rebalancing phase.
As Romtelecom intended to operate the next tariff rebalancing on February 1, 2005, ANRC required S.C. Romtelecom S.A., ever since August 2004, to submit certain documents for the purpose of justifying the opportunity of the tariff rebalancing. ANRC requested that the rebalancing application should be in compliance with the provisions of the ANRC Decision on separate accounting and should be accompanied by an audit report in accordance with the International Audit Standards, as well as by a sensitivity analyses set, emphasizing the effect of modifying the income, the expenditures and the invested capital on the profitability of the invested capital.
Between November – December 2004, S.C. Romtelecom S.A. transmitted ANRC the justifying documents elaborated upon the ANRC requirements. On November 24, 2004, Romtelecom completed its tariff rebalancing application, requesting:
– tariff increase for main telephone line subscription, by 39.7%, on average;
– tariff decrease for long distance calls during peak hours, by 10%;
– tariff decrease for calls to mobile telephone networks, by 3.4%;
– tariff decrease for calls to certain international terminations, by 9.1%, on average.
ANRC considers the medium term tariff rebalancing as a salient process for the fulfilment of the competition promoting objective, since the subscription tariffs of Romtelecom do not cover the corresponding costs, the alternative operators’ capacity to compete on this market being thus affected. On the other hand, for the purpose of fulfilling the ANRC objective of stimulating investments in infrastructure, Romtelecom’s capital profitability must reach an attractive rate for its investors.
ANRC is still analysing and discussing with the Romtelecom experts, at a point when we can estimate that ANRC will have made a decision by the end of this year.
| The main amendments requested for February 1, 2005 | |||
| Increase (average) | Decrease (average) | ||
| Subscriptions | 39.7% | Long-distance calls during peak hours | – 10% |
| Calls to mobile telephone networks | – 3.4% | ||
| International calls | – 9.1% | ||
Tariff increase required – absolute figures
| CURRENT | Current tariff Individual line | REQUIRED | Proposed tariff Individual line | Tariff change | |||
| (EUR/month) | (EUR/month) | ||||||
| Non-VAT included | VAT included | Non-VAT included | VAT included | EUR/ month | ROL/ month | ||
| 1. MTL without credit, in automatic networks | 3.31 | 3.94 | 1. MTL with 20 minutes credit –long-distance calls during off-peak hours, in the automatic Romtelecom network | 5 | 5.95 | 2.01 | 77,834 |
| 2. MTL with EUR 0,80 credit, in automatic networks | 4.1 | 4.88 | 2. MTL with 35 minutes credit – local calls during peak hours, in the automatic Romtelecom network | 5.7 | 6.78 | 1.90 | 73,689 |
| 3. MTL with EUR 1,65 credit, in automatic networks | 4.9 | 5.83 | 3. MTL with 50 minutes credit – local calls during peak hours and with 10 minutes credit – long- distance calls during off-peak hours, in the automatic Romtelecom network | 6.4 | 7.62 | 1.79 | 69,083 |
| 4. Restricted subscription (social) | 1.8 | 2.14 | 4. Subscription without credit | 4.9 | 5.83 | 3.69 | 142,772 |
EUR1 = ROL38702 on 20.12.2004
Tariff decrease required – absolute figures
| Long distance calls during peak hours | 0.06 | 0.071 |
| 0.054 | 0.064 |
| –276 | ROL/min |
| Calls to mobile telephone networks | 0.145 | 0.173 |
| 0.14 | 0.167 |
| -230 | ROL/min |
| International calls – average decrease by 9.1% |
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MTL = main telephone line