March 18, 2024 Release of Report from Study Group on Operation of Price Cap System

 The Ministry of Internal Affairs and Communications (MIC) has held a study group (chaired by TSUJI Masatsugu, President of Kobe International University) on the operation of the price cap system (hereinafter referred to as the “Study Group”) since December 2022 to discuss and consolidate matters that should be kept in mind when calculating the expected rate of productivity improvement (X-factor) required for setting a standard charge index indicating the maximum rate level (price cap) for telephone subscription services. This study group’s report has recently been compiled.

1. Background

 The maximum rate level (price cap) has been applied as a rate regulation since October 1, 2000 to charges related to telephone services, including telephone subscriber services, of Nippon Telegraph and Telephone East Corporation and Nippon Telegraph and Telephone West Corporation.
 For setting the standard charge index that indicates the maximum rate, the expected rate of productivity improvement (X-factor) is to be calculated every three years based on a reasonable forecast of future costs. Since the application deadline of the current X-factor is the end of September 2024, it is required to calculate the new X-factor necessary for setting the standard charge index applied from Tuesday, October 1, 2024.  MIC has held the study group since December 2022 to discuss and consolidate matters that should be kept in mind when calculating X-factor to be applied for the next term (three years from Tuesday, October 1, 2024).
This study group’s report has recently been compiled.

2. Future plans

 The standard charge index applicable from Tuesday, October 1, 2024, will be calculated considering the report of this study group and subject to consultation between the Information and Communications and Posts Administrative Council (chaired by AIDA Hitoshi, Professor Emeritus of The University of Tokyo).

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  The published materials are in Japanese only.