4. Applicants' Response to Show Cause Order

In a response dated May 18, 2000, applicants sought to clarify that the application in fact was being brought pursuant to Sections 852 and 854 of the Code.

Through affidavits of officers of both corporations, applicants state that the Internet services market is highly competitive, and it was necessary for ATC to act quickly in acquiring CRL because time was of the essence in the transaction. Applicants state that their request for approval of the transaction was filed within 60 days of the transaction, on March 2, 2000, but the filing was returned because it did not contain a required verification. The corrected filing was made on April 4, 2000.

The officers' affidavits state that ATC will realize significant financial and competitive benefits through its acquisition of CRL which will directly benefit the public in the form of increased reliability, expedited rollout of new services, and improved customer service. In particular, they state, the transaction enhances ATC's operational flexibility and efficiency, and gives it the opportunity to strengthen its competitive position.

Applicants note that this Commission has granted approval to transfers nunc pro tunc, i.e., with the same effect as if done earlier, where our examination of the transfer revealed no prejudice to ratepayers. (See HTC Communications, LLC, for Approval Nunc Pro Tunc to Transfer Control to Pointe Communications, D.00-04-014, 2000 Cal. PUC LEXIS 192; Winstar Communications (1995) 59 CPUC2d 635.)