DOCKET NO. UT- # PAGE 1 BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION In the Matter of the ) Supplemental Application of ) PRIMUS TELECOMMUNICATIONS, ) DOCKET UT- 951213 INC., for an Order Amending the ) Registration of Applicant ) FIRST SUPPLEMENTAL as a Telecommunications Company ) ORDER AMENDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ) REGISTRATION On May 7, 1998, Primus Telecommunications, Inc., (Primus) filed a suuplemental application to amend it's registration as a telecommunications company pursuant to RCW 80.36.350. Applicant proposes to offer debit card services to the public. Primus is a Delaware corporation, headquartered in McLean, Virginia, and is wholly-owned by numerous individuals. Initially, Primus was authorized to provide resold long distance services in Docket UT-951213. Rates, terms and conditions set forth in the proposed tariff, filed as Exhibit G of the application, are structured to be competitive with other telecommunications companies in relevant markets. Exhibit G was amended on May 7, 1998. Primus has provided information showing that it meets the requirements of RCW 80.36.350. The nature of the debit card service implies that Primus will collect advance payments from customers. Pursuant to statutes and rules governing registration applications and advance payment proposals, Primus has proposed a satisfactory bond agreement for protection of those advance payments. Initially, the bond agreement will be for $4,000 and will increase proportionally as the customer base increases. If Primus ceases operations, it will provide the insurer and the Commission lists of outstanding account numbers and balances within 48 hours. Primus will limit the maximum denomination of each debit card purchased by residential customers to not more than $50 and debit cards purchased by business customers to not more than $200. Within 15 days after September 30, 1998, and quarterly thereafter, Primus will be required to submit to the Commission a report containing the following information specific to its State of Washington operations: (a) total outstanding debit card balance at the beginning of the reporting period (b) dollar amount of debit cards sold during the reporting period (c) depleted usage of debit cards during the reporting period and (d) total outstanding debit card balance at the end of the DOCKET UT-951213 PAGE 1 reporting period. Statements shall continue to be filed within 15 days after each 3-month period thereafter until Commission staff informs applicant such reports are no longer required. Based upon this information, Primus will adjust the amount of the bond to assure compliance with WAC 480-121-040. In addition, Commission staff may request current company financial information. After one year’s administration of the bond agreement, the reporting requirement may be modified to a semi-annual level if the company has maintained adequate levels in the bond agreement during the previous 12-month period. Primus will state an unconditional money back guarantee on the debit card or on supplemental material that will be provided at the time the debit card is purchased with a statement warning customers to safeguard their cards. If Primus goes out of business, it will provide refund information on the company’ s “800" phone number for its customers. Primus will provide a free call detail report to customers upon request. FINDINGS THE COMMISSION FINDS: 1. Primus Telecommunications, Inc., filed a supplemental application for registration as a telecommunications company pursuant to the provisions of RCW 80.36.350 and the rules and regulations of the Commission. 2. As to form, the application filed by Primus Telecommunications, Inc., as supplemented and amended, meets the requirements of RCW 80.36.350 and the rules and regulations of the Commission adopted pursuant thereto. 3. The registration of Primus Telecommunications, Inc., as a telecommunications company is not inconsistent with the public interest. 4. In this proceeding, the Commission in no way endorses the financial viability of applicant nor the investment quality of any securities it may issue. O R D E R THE COMMISSION ORDERS: 1. After the effective date of this order and subject to the conditions contained in this Order, the Commission approves the supplemental application of Primus Telecommunications, Inc., filed pursuant to RCW 80.36.350 for registration as a telecommunications company to provide service to the public in this state. 2. The proposed tariff revisions as filed on May 7, 1998, supplemented and amended in Exhibit G, attached to the application, are satisfactory. 3. Registration of Primus Telecommunications, Inc., as a telecommunications company shall not be construed as an endorsement of financial viability or of the investment quality of any securities it may issue. 4. As a telecommunications company providing service to the public in this state, Primus Telecommunications, Inc., is subject to the jurisdiction of this Commission under the provisions of Title 80 RCW and all rules and regulations of the Commission adopted pursuant thereto. 5. Primus Telecommunications, Inc., filed with the Commission a satisfactory bond agreement in the amount of $4,000. As part of the bond agreement and in the event the company ceases operations, Primus Telecommunications, Inc., will within 48 hours provide to the insurer and the Commission lists of outstanding account numbers and balances. 9. Primus Telecommunications, Inc., will limit the maximum denomination of each debit card to be purchased to $50 for residential and $200 for business customers. 10. Within 15 days after September 30, 1998, and quarterly thereafter, Primus Telecommunications, Inc., will submit to the Commission a report containing the following information specific to State of Washington operations: (a) total outstanding debit card balance at the beginning of the reporting period (b) dollar amount of debit cards sold during the reporting period (c) depleted usage of debit cards during the reporting period and (d) total outstanding debit card balance at the end of the reporting period. Statements shall continue to be filed within 15 days after each 3-month period thereafter until Commission staff informs applicant such reports are no longer required. Based upon this information, Primus Telecommunications, Inc., will adjust the amount of the bond to assure compliance with WAC 480-121-040 and notify the Commission of that adjustment in its next quarterly report. In addition, Commission staff may request current company financial information. After one year’s administration of the bond agreement, the reporting requirement may be modified to a semi-annual level if the company has maintained adequate levels in the bond agreement during the previous 12-month period. 11. Primus Telecommunications, Inc., will state an unconditional money back guarantee on the debit card or on supplemental material that will be provided at the time the debit card is purchased with a statement warning customers to safeguard their cards. 12. In the event the company ceases operations, Primus Telecommunications, Inc., will provide refund information on the company’s “800" phone number for its customers for a minimum of six months. 13. Primus Telecommunications, Inc., will provide a free call detail report to customers upon request. DATED at Olympia, Washington, and effective this 15th day of June, 1998. CAROLE J. WASHBURN, Secretary