ART drafts the list of pertinent costs and their calculation method

6 November 2000

Following discussions by the working group on local loop unbundling chaired by Alain Bravo (which began its work in February 2000), ART has approved two decisions establishing the list of pertinent costs for access to the local loop and the means by which these costs are calculated. They also adopt the guidelines for verifying that local loop access prices are cost oriented.

These two decisions, which were taken within the deadlines previously announced by ART, are applicable to both fully unbundled access and shared access to the local loop.

• The decision on the list of pertinent costs and their calculation method

The decree of 13 September 2000 regarding access to the local loop requires that ART publish the list of pertinent costs and the calculation method for average long-run incremental costs (LRIC).

In decision no. 00-1171 dated 31 October 2000, ART described all of the costs incurred by France Telecom which must be taken into account in calculating prices for access to the local loop.

In the same decision, ART defined the calculation method for prices based on average long-run incremental costs. This method aims to evaluate the cost of building a complete local loop network using the best copper technologies currently available. This decision will allow France Telecom to publish its reference offer by the deadline set by the "unbundling" decree, i.e. by 1^st December at the latest.

• Guidelines verifying the cost orientation of prices

In decision no. 00-1176 dated 31 October 2000, ART also adopted the guidelines to be used to verify that prices for access to the local loop are cost oriented.

This text establishes the list of documents that ART is permitted to request from France Telecom to verify, as per the decree, that the reference offer's prices are indeed cost oriented.

France Telecom is not required to submit its local loop access prices for approval by ART, although ART does verify that they are cost oriented.

These two decisions, which may be added to in view of the reference offer to be published by France Telecom, are a major step in the local loop access unbundling process.