Industry committee prioritizes foreign ownership study; to hear from industry, CRTC, government officials

The House Standing Committee on Industry, Science and Technology is giving top priority to its review of the foreign ownership rules in the telecom and broadcasting sectors, committee chair and Conservative MP Michael Chong says. The committee will give the telecom review first priority following routine committee business, and is currently scheduled to hold four hearings on the issue. However the number of hearings may be extended depending on the number of witnesses invited to testify. Industry Minister Tony Clement said last week that his department will be holding public consultations in preparation for legislation to liberalize foreign investment rules in the telecom sector. Chong told The Wire Report that the committee’s review will complement Industry Canada’s consultations. “The minister has announced that he is going to loosen up foreign ownership restrictions in a portion of the sector pertaining to satellites. As well, there are public consultations that may open up the entire sector,” Chong said. “In light of that, the committee thought it was a good idea to undertake a complementary process and to take a look at this issue." Chong said the committee is undertaking its responsibility "to provide a check and a balance to the executive branch of government,” and that, “I think this issue is big enough for two different branches of government to take a look at it.” On March 11, the industry committee agreed a motion from Liberal MP and committee member Marc Garneau that says the committee will “begin a review of Canada’s foreign ownership rules and regulations under the Telecommunications Act, the Radiocommunications Act, the Broadcasting Act and any other legislation deemed appropriate,” according to committee minutes. While a list of witnesses hasn’t been confirmed, Garneau said he expects to hear from CRTC and Industry Canada officials, Clement, as well as officials from Globalive Wireless Management Corp., Public Mobile, satellite company Telesat, and other telecommunication and broadcasting companies. Bloc Québécois MP and committee member Serge Cardin said the committee may also hear from experts from the Canadian cultural sector. Liberal MP and committee vice-chair Anthony Rota said the committee’s review will offer a different perspective than the public consultations. “The important thing about the committee is that it is parliamentarians who are looking into the acts and making sure that they reflect what is best for Canadians. I think there is a little bit of a difference in perspective when you are representing constituents as an elected official as opposed to an industry official,” Rota said in an interview. “In light of the takeovers that have been taking place over the last couple of years, it’s important that we look at foreign investment that takes place in Canada and make sure that it serves the best interest of Canadians.” Garneau said his motion was prompted by the government’s reversal of the CRTC’s Globalive decision. “It was absolutely necessary that we have a sitting of the industry committee whereby my party would be able to ask the CRTC how they interpreted the foreign ownership rules and why … they thought Globalive was not eligible,” he said. Garneau said the study will also be an opportunity for committee members to hear from Clement about his interpretation of the foreign ownership rules “and why he came to a different conclusion and decided to reverse the CRTC decision.” Chong said there are “a number of concerns” about Canada’s telecommunication industry that justify the study. “First, it’s that we are one of the last major OECD economies to have foreign ownership restrictions in place. The second is that many have complained about the high cost of wireless access in Canada. And the third is that the companies in the sector are complaining that they have a lack of access to capital to build and maintain their networks,” Chong said. Garneau said what’s important is that parliamentarians from all parties get a chance to review the government’s stance on the foreign ownership rules. “We are trying to achieve a balance between greater access, greater speed, greater choice, and lower prices, in terms of the pipeline that will connect Canadians,” he said. “We need to do this so competition in principle can be looked at, but we want to know the full implications. We don’t want these decisions being made by the minister of industry in the dead of night.” Cardin said his party supports the review, but is calling for a moratorium on the Globalive decision until the committee issues its recommendations. Globalive’s Wind Mobile has already launched in several Canadian cities, however. Cardin said the government wants to increase competition and lower prices, but must be certain that this does not result in a loss of Canadian control of the telecommunications and broadcasting sectors. “The government is aiming for competition, but nothing is less certain than this. For gas prices, is there a big gap between the price of one company and another? Even if there is a fourth, a fifth, or a sixth new wireless phone player, will we really see a decrease in prices? I don’t think so,” he said. kfournier@thewirereport.ca

Industry committee prioritizes foreign ownership study; to hear from industry, CRTC, government officials

Broadcast | March 17, 2010

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