Life is a full circle – no doubt about that. It’s no coincidence that last June, Wind Mobile was embroiled in a fierce legal battle over complaints that it didn’t meet Canada’s ownership standards.
And now, exactly a year later, Wind is complaining that nearly 50% of Telus’ voting shareholders live outside Canada, which suggests they are not Canadian. The carrier’s parent body, Globalive, has formally asked the CRTC to review TELUS ownership to ensure compliance with foreign ownership limits.
Canadian ownership laws state that foreigners can own no more than one-third of companies that own telecom carriers. Wind says Telus employs ‘complicated and rarely used’ methods to bend the law to control its foreign levels. Of course, Telus isn’t amused with the accusations. In its defense, the carrier maintains that it fully abides by the Canadian ownership laws and the allegations are “unfounded and misleading.”
Wind Mobile is no stranger to foreign ownership rules. In April, the Supreme Court of Canada dismissed the case brought against WIND Mobile, tossing out Public Mobile’s complaint that the new carrier was foreign-owned.
As far as the foreign ownership restrictions go, the government is about to lift restrictions on investment in firms that hold less than 10 percent of the market share with regard to revenue. The current exemption stays in place for companies that increase their market share beyond the 10 percent goalpost without merging with a rival, however. This implies that the new rules do not apply to Bell, Telus or Rogers.
Surely, this isn’t the end of Canada’s ongoing foreign ownership conundrum. As my fellow blogger Jordan Richardson mentioned in one of his posts – “The foreign ownership question has haunted Canada’s telecommunications sector for some time now, with conservatives generally saying that they’d planned to open things up as soon as they could. The established players stated their desires to have things opened across the board, but that’s not part of the plan.”
Telus now has 30 days to respond to the application, after which Globalive will have 10 days to reply to any submissions, though it’s possible that these deadlines could be extended.