Big Three urge Ottawa to Relax Foreign Investment Rules For Telco Companies

by Istvan Fekete on January 29, 2013

Darren Entwistle, Telus Corp. president and chief executive officer, believes the federal government should establish a definitive plan to relax foreign investment rules over the next 3–5 years to create a level playing field.

As Mr. Entwistle points out, the current two-tiered system gives an unfair advantage to “opportunistic” foreign investors over domestic companies that have been building Canada’s broadband infrastructure.

Wind Mobile, for example, benefitted from the new measures Ottawa introduced, which allow a 100% foreign ownership of Canadian telcos, retaining 10% or less market share. Bell, Telus and Rogers, however, are prohibited from allowing foreign investors more than 33.3% of ownership.

“We believe in market liberalization. We don’t think that there should be any artificial regulation or fettered access to international capital markets. We want to enjoy that on a fluid basis,” said Mr. Entwistle speaking with The Globe and Mail.

“We are not in favour of a tilted playing field where one segment of the market, according to certain terms and conditions, gets liberalized when another segment of the market does not. We don’t think that that’s fair,” he added.

Mr. Entwistle is also highlighting the benefits smaller carriers will have in the upcoming wireless spectrum auction, as incumbents are facing limitations on the amount of prime spectrum they can purchase.

Wind Mobile will be the first fully foreign-owned telco company operating in Canada, as it is going through the process of being formally acquired by its foreign parent the Amsterdam-based VimpelCom Ltd., and more likely will be one of the participants in the upcoming wireless spectrum auction.

His position is backed by the $30 billion Telus has invested in upgrading broadband networks across Canada since 2000, and both Rogers and Bell share his position. From Mr. Entwistle’s perspective this means they have “earned the right” to enjoy a level playing field. “One thing I could say with confidence, I do think the telecommunications industry will get fully liberalized. It is not a question of if, but rather when,” he said.

The big three urge the Ottawa federal government to establish a comprehensive plan to relax the remaining foreign investment restrictions over a 3–5 year period, with the same foreign investment rules to be applied to all players. “For there to be real symmetry in communications foreign ownership rules, the Broadcasting Act would have to be considered as well,” said BCE spokesman Mark Langton.

Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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Voto April 2, 2014 at 10:15 pm

Stop the CRTC from allowing Internet menetirg in Canada In Canada Internet providers are attempting to monopolize the market, and raise the price of residential high-speed internet access. Providers such as Telus (in Alberta and British Columbia), Bell (in Ontario and Quebec) and Shaw are looking to put a c

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