The UK telecom-industry regulator Oftel has published proposals for the contractual terms and conditions for independent operators and British Telecom (BT) to supply support services for unbundling the local loop.

Oftel submitted its proposals because BT and independent operators failed to agree the terms and conditions.

Local loop unbundling will speed the adoption and roll-out of broadband services, such as ADSL (Asymmetric Digital Subscriber Line). This will offer major opportunities to consumers, and the chance for content providers to develop new services, such as video-on-demand and Internet-only TV stations. Unbundling is also expected to bring Internet and broadband access-costs down.

The local loop unbundling issue first emerged two years ago, and BT has been accused by independent operators, consumers and the government of creating obstacles to its progress – a charge it denies.

BT says one obstacle to unbundling has been lack of space at its exchanges – a claim independent operators say is a stalling tactic.

Oftel said: "Where BT claims there is insufficient space in an exchange, operators will be able to commission an independent survey of an exchange. If the survey finds there is enough room, BT will have to pay compensation to the operators."

A BT spokesperson said: "We've been talking to industry groups about this for two years. There are a multiplicity of different views. People have different needs and agendas.

"We suggested independent verification of problems about space weeks ago, BT is pleased Oftel has placed this in its agreement."

Oftel also plans to allow operators to request independent verification of BT's proposed charges for co-location facilities, and BT is now contractually bound to meet its time scales for making co-location facilities and loops available.

BT is also required to pay compensation to independent operators if it does not maintain the same level of service that it provides to its own businesses.

A contractual dispute-resolution procedure is also to be discussed, to involve independent experts, said Oftel.

David Edmonds, Oftel's director general of telecommunications, said: "Oftel has found in favour of the operators' complaints that the contract proposed by BT was unreasonable in a number of important areas."

Edmonds said Oftel's proposed conditions would ensure operators get good service from BT, boosted by the right to call in independent experts when agreements cannot be reached.

The BT spokesperson added: "There is a huge amount of detail in Oftel's statement which we will obviously be studying, and responding to."

Edmonds also said that the UK is "well on the way" to finalizing all parts of the framework for local loop unbundling in the UK.

He added: "BT has begun work to prepare the first exchanges for co-location and has agreed to have unbundled local loops available in 600 exchanges by the end of June 2001."

Oftel's proposals are not yet final, though, after a 28-day consultation period, the regulator will make a formal determination of the terms and conditions, which BT will then be forced by law to adhere to.