THE BACK-AND-FORTH paper war between Wind and Telus will not abate until the CRTC says one way or another whether it will call a hearing into the matter.
On one side we have Wind (also known as Globalive Wireless), which spent two years fighting off allegations from Telus, Public Mobile and others that its level of Canadian ownership did not satisfy Canadian regulations. That battle went all the way to the Supreme Court. On the other side we have Telus, which has run into some unexpected rough waters trying to convert its two share structure into one.
As we have reported, back in June, Wind complained to the Commission that Telus, because of the share conversion struggle which it has not given up on, might be in violation of Canada’s foreign ownership laws that say 66.7% of a Canadian telco must be owned by Canadians. It demanded the CRTC look into the matter with a public hearing and produced letters and data and other allegations saying it looks like there could be a problem.
Telus responded that it has always been in compliance with Canadian law, that foreigners owned 32.59% of its shares as of June 29th and that Wind’s complaint is baseless and should be tossed out.
On August 13th, the CRTC sent Telus a letter (as is often the practice in these cases) with five clarification questions resulting from the company’s July reply to Wind’s original complaint. Telus supplied its answers on August 24th.
“The responses filed by Telus demonstrate that the compliance systems put in place by the company to verify and ensure Canadian ownership and control are rigorous, effective and authorized by the Canadian Telecommunications Common Carrier Ownership and Control Regulations (the “Regulations”). Moreover, Telus has voluntarily adopted compliance practices that, in certain cases, materially exceed the baseline requirements of the Regulations,” reads the Telus letter.
“Based on these responses and the entire record of this proceeding, the Application is bereft of merit and should be rejected swiftly by the Commission.”
On Wednesday, having read the answers, Wind was unsurprisingly miffed. The answers supplied by Telus “raises more questions about Telus’s complex and novel Compliance Mechanisms than it answers. It has become clearer with each step in this proceeding, including the Telus Response, that a Type 3 or Type 4 review is the only appropriate forum to consider the Compliance Mechanisms and Telus’s compliance with the Ownership Rules,” reads Wind’s August 29th letter to the Commission.
Now, we have read the complaint, the response, the reply, the questions, the answers and the latest letter and it’s quite a war of words (you can see the whole lengthy file here, except for the last Wind submission). In fact, both sides have gotten cranky with Cartt.ca in e-mails and over the phone over our coverage of the matter – which will either go to a hearing, or the Commission will dismiss it. An announcement of some sort will come soon.
But even then, one gets the impression that if the CRTC decides there isn’t enough evidence to go further that Wind will pursue the matter to higher powers.
Of course, one way to erase the whole fight would be for our federal government to liberalize our foreign investment rules beyond the little bit it has already done, but we digress…
– Greg O’Brien
