A. In accordance with the policy established in the New Mexico Telecommunications Act, the commission shall, by its own motion or upon petition by any interested party, hold hearings to determine if any public telecommunications service is subject to effective competition in the relevant market area. When the commission has made a determination that a service or part of a service is subject to effective competition, the commission shall, consistent with the purposes of the New Mexico Telecommunications Act, modify, reduce or eliminate rules, regulations and other requirements applicable to the provision of such service, including the fixing and determining of specific rates, tariffs or fares for the service. The commission's action may include the detariffing of service or the establishment of minimum rates that will cover the costs for the service. Such modification shall be consistent with the maintenance of the availability of access to local exchange service at affordable rates and comparable message telecommunications service rates, as established by the commission, for comparable markets or market areas, except that volume discounts or other discounts based on reasonable business purposes shall be permitted. Upon petition or request of an affected telecommunications company, the commission, upon a finding that the requirements of Subsection B of this section are met, shall modify the same or similar retail regulatory requirements for those providers of comparable public telecommunications services in the same relevant markets so that there shall be parity of retail regulatory standards and requirements for all such providers; provided, however, that this subsection shall not be construed to permit the adoption of any new regulatory requirements or standards for providers of comparable telecommunications services.

B. In determining whether a service is subject to effective competition, the commission shall consider the following on a wire center serving area basis for each wire center serving area and service for which a determination of effective competition is requested, and separate determinations shall be made for residential and business services in each wire center serving area:

(1) the extent to which services are reasonably available from alternate providers;

(2) the ability of alternate providers to make functionally equivalent or substitute services readily available at competitive rates, terms and conditions;

(3) existing economic, technological, regulatory or other barriers to market entry and exit;

(4) the number of other providers offering the same or reasonably comparable services;

(5) the presence of at least two facilities-based competitors, including without limitation facilities-based providers of wireless or voice over internet protocol services, operating in all or part of the wire center for which a determination of effective competition is requested that are unaffiliated with the petitioning carrier and provide the same or reasonably comparable service of the type for which the finding of effective competition is sought;

(6) the ability of the petitioning provider to affect prices or deter competition; and

(7) such other factors as the commission deems appropriate.

C. If, in the wire center serving area for which a determination of effective competition is requested, the incumbent local exchange carrier provides basic local exchange service either separately or bundled to less than one-half of the customer locations where such service is available at the time the petition is filed, the public interest requires that effective competition be presumed for all regulated telecommunications services provided by the incumbent provider in that wire center serving area; provided, however, that findings and presumptions applied pursuant to this section shall be made separately for residential and business services and customer locations.

D. No provider of public telecommunications service may use current revenues earned or expenses incurred in conjunction with any noncompetitive service to subsidize competitive public telecommunications services. In order to avoid cross-subsidization of competitive services by noncompetitive telecommunications services, prices or rates charged for a competitive telecommunications service shall cover the cost for the provision of the service consistent with the provisions of Subsection G of Section 63-9A-8.1 NMSA 1978. In any proceeding held pursuant to this section, the party claiming that the price for a competitive telecommunications service does not cover the cost shall bear the burden of proving that the prices charged for competitive telecommunications services do not cover cost; provided, however, that the commission may require the telecommunications company against whom the complaint is filed to submit a cost study for the service that is the subject of the complaint as part of its examination and determination of the complaint.

E. The commission may, upon its own motion or on the petition of an interested party and after notice to all interested parties and customers and a hearing, reclassify any service previously determined to be a competitive telecommunications service if after a hearing the commission finds that a service is not subject to effective competition.

F. If a wire center service area is deregulated pursuant to a determination of effective competition, for those wire center service areas where that service is deregulated, the petitioning telecommunications company shall no longer be eligible to claim an exemption from the application of the Unfair Practices Act [Chapter 57, Article 12 NMSA 1978] or the Antitrust Act [57-1-1 to 57-1-15 NMSA 1978].

History: Laws 1985, ch. 242, § 8; 1987, ch. 21, § 6; 2017, ch. 71, § 3.

The 2017 amendment, effective June 16, 2017, clarified and provided additional considerations for determining whether a service is subject to effective competition, and provided a presumption of effective competition in certain circumstances; in the catchline, added "effective competition"; in Subsection A, after "requirements of Subsection", deleted "C" and added "B", after "same or similar", added "retail", after "parity of", added "retail", and after the semicolon, added the remainder of the subsection; in Subsection B, in the introductory clause, after "following", added the remainder of the introductory clause, in Paragraph B(1), after "providers", deleted "in the relevant market area"; in Paragraph B(3), after "economic", deleted "or" and added "technological", after "regulatory", added "or other", and after "barriers", added "to market entry and exit", and added Paragraphs B(4) through B(7); added a new Subsection C and redesignated former Subsections C and D as Subsections D and E, respectively; in Subsection D, after "provision of the service", added "consistent with the provisions of Subsection G of Section 63-9A-8.1 NMSA 1978", after "the party", deleted "providing the service" and added "claiming that the price for a competitive telecommunications service does not cover the cost", after "telecommunications services", added "do not", and after the semicolon, added the remainder of the subsection; and added Subsection F.

Constitutional authority not limited. — Although statutory authority specifically is granted to the state corporation commission (now public regulation commission) to regulate a public telecommunications service, such provisions do not limit its constitutional authority under N.M. Const., Art. XI, § 7. Mountain States Tel. & Tel. Co. v. N.M. State Corp. Comm'n, 1990-NMSC-017, 109 N.M. 504, 787 P.2d 423 (decided under prior law).

Under "filed rate doctrine" plaintiff's claims concerning the level of collect telephone call rates were properly dismissed, as the filed rate is the only legal rate. Valdez v. State, 2002-NMSC-028, 132 N.M. 667, 54 P.3d 71.

Commission may regulate rates for intrastate telecommunications services. Qwest Corp. v. City of Santa Fe, 380 F.3d 1258 (10th Cir. 2004).

Telephone company's third-party billing and collection services were subject to regulation by the state corporation commission (now public regulation commission), where such services involved timing calls through switching operations and transmitting recorded data to the company's billing department. Mountain States Tel. & Tel. Co. v. N.M. SCC, 1988-NMSC-088, 107 N.M. 745, 764 P.2d 876.

Pay telephone services. — State corporation commission (now public regulation commission), in its discretion, could consider any relevant factor in making its determination whether to detariff pay telephone services if effective competition was found to exist. The commission could examine the market-share factor in order to make a decision regarding the existence of effective competition. Mountain States Tel. & Tel. Co. v. N.M. State Corp. Comm'n, 1990-NMSC-017, 109 N.M. 504, 787 P.2d 423.