2) To assess whether a Controlled Wholesale Tariff is cost-oriented, the Authority shall use, either: a) A forward-looking incremental cost methodology, or b) An international benchmark of relevant Wholesale Tariffs. 3) When assessing a Controlled Wholesale Tariff based on a forward-looking incremental cost methodology, the Authority shall apply the following principles: a) Forward-looking costs shall refer to the costs an Efficient Operator would incur to provide a given service. b) The cost basis shall be established by using any of the following cost modelling methods: i) Fully allocated costs; ii) Long-run incremental cost (LRIC); or, iii) Long-run incremental cost plus (LRIC+), which allows for joint and common costs. 4) When assessing a Controlled Wholesale Tariff based on international benchmarks, the Authority shall use data from: a) Countries that have used a forward-looking incremental cost methodology to set the tariff of a comparable service; and, b) Countries that can reasonably be regarded as comparable to Ethiopia. 5) Where the Authority has not able to obtain reliable information to assess a Controlled Wholesale Tariff by using any of the options provided in Sub-Articles (3) and (4) of this Article, the Authority may consider a settlement-free approach to set such tariff, if: a) The provider of the Wholesale Service receives a comparable Wholesale Service from the other party to an agreement; or, b) The Authority has determined the settlement-free approach to be reasonable. 6) A Controlled Wholesale Tariff shall be deemed unduly discriminatory if a provider of the corresponding Wholesale Service charges a different rate to different operators for similar services provided under similar terms and conditions, unless this can be justified by differences in costs or expected costs, of providing the services. 7) A Controlled Wholesale Tariff shall be deemed unduly discriminatory, if a Vertically Integrated Operator providing the corresponding Wholesale Service, self-supplies its Downstream Operation at a lower cost than it charges other operators for that same or similar Wholesale Service. 8) When assessing the cost of self-supplying the relevant Wholesale Service referred in Sub-Article (7) in this Article, the Authority shall apply the forward-looking incremental cost methodology from Sub-Article (3) in this Article, to impute costs to the self-supplied Wholesale Service. 5

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