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Canada Courts Quash Gov't Decision On Globalive
sitkill writes "A Canadian Federal Court ruling has rejected the Tory Cabinet's decision to overturn a CRTC mandate not allowing Globalive (which is more commonly known in Canada as the mobile carrier Wind) to operate in Canada. This is a small vindication to the embattled CRTC, which has been recently in the spotlight for its decision on usage based billing, drawing criticism from the Tory Cabinet. The CEO, Mr. Lacavera, stressed that this would not result in Globalive's Wind Mobile being shut down, simply that it would require another round of wrangling with the regulator over how much foreign influence is acceptable in a Canadian telecommunications company."
One should *always* stick with a company based in one's own nation. I'll have to get on my T-Mobile phone and send the news to my buddies on Facebook right aw...
(I kid, I kid...)
Quo usque tandem abutere, Nimbus, patientia nostra?
Can we please unscramble this? I lost count of the negatives. Can Globalive operate in Canada, or not?
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It's patently obvious to most Canadians that many of our government agencies collude with industry to screw citizens out of their hard earned dollars. From protectionism to anti-competitive regulation, it seems like virtually everyone we employ from city to federal government is cashing two paycheques.
Didn't really see this one coming though. Usually the courts exercise some amount of restraint enforcing bad law after bad law.
A government is a body of people notably ungoverned - AC
Quebec should stay, it's Ottawa that should separate.
That's ridiculous. It's a condemnation of the Harper government's attempt to circumvent the foreign ownership laws on behalf of one particular company, without actually bothering to amend the law first.
(Note: this is based on my memory of reading the decision last night at 4 a.m., and I don't feel like rereading it for a /. comment; some things may be slightly off, and IANAL, but the gist is correct.)
Telecommunications companies in Canada cannot be "influenced" by non-Canadians, which means while non-Canadians can have a stake in a company, it can't be significant (there's no set standard, but think under 10% or 20% and not on the board). (Whether this policy is a good idea is fully debatable, but it's the law.)
Globalive (operating as Wind Mobile) is an upstart Canadian cell phone company run by Canadians (technically, they're old, but new to the cell market); there's no dispute here. However, to bid in the recent spectrum auction, it needed cash. So they called up Orascom, an Egyptian company, to get some financing. But they needed so much money that if they issued equity (shares) Orascom would own more than half of Globalive, breaking the Telecommunications Act. So they decided to borrow the money (debt) from them instead, thereby getting around the rules.
Public Mobile, another upstart Canadian company that also won spectrum in the auction, said this was unfair: they played by the rules and got financing from Canadians, and so took Globalive to the CRTC. The regulator ruled that while "in law" Globalive was certainly Canadian, "in fact" they owed so much money as a part of their overall net worth (~2/3) to Orascom there was no way the latter couldn't have influence on the former, which meant Globalive broke the rules and couldn't even bid in the spectrum auction, let alone operate in Canada.
The Conservative Government, which is generally pro-free market (in favour of foreign investment and competition and against regulators and government, though many have argued their actions haven't matched their ideals (see, e.g. Potash Corp., supply management, etc.)), issued a cabinet decision that overruled their regulator, thereby allowing Globalive to operate (which it did within days). They are allowed to overrule the CRTC, but they can't just say "because I said so": they need to justify their reasons, and the Federal Court can review their decision to see if their reasons are reasonable. (Obviously any decision will be debatable, so there is some standard for reasonableness.) So Public Mobile took the government to court. (For those interested in where our scummy telcos (Bell, Rogers, Telus) lined up, they all, of course, favoured less competition, so wanted to get Globalive out of business regardless of the merits of the case, though only Telus spoke at trial. We know they're hypocrites because their execs have all publicly lobbied for opening up telcos to foreign ownership and financing, while arguing against it here.)
The court ruled that the CRTC was correct in determining that Globalive was influenced by a non-Canadian, and that the government's "reasons" for their decision did not change this.
Basically, there are four basic tenets of telecommunications policy set out in the act, and one of them is the no non-Canadian influence part. The government tried to say that this part was less important than the other three parts, and that this part should only be applied "when possible" (i.e. when it won't conflict with the other parts). The government also seemingly added another tenet, which was that companies should search for technological advancement from outside Canada. And lastly, it said its cabinet decision applied only to Globalive, so wasn't precedent.
The court said while there would be nothing wrong with a policy that had some tenets be more important than others, or one that added other tenets, that's not what the law says, and unless Parliament (legislative branch) changes this, the Cabinet (executive branch) can't issue a decision that isn't grounded in law. The court also said the arbitrariness of the decision (applying only to Globalive) further proved their decision couldn't stand.
So that's where we are. The judge sta
and the judge will get a box with all channels for free and uncapped max speed internet.
I'm a Wind customer: $40 / month, unlimited talk & text Canada & US wide, unlimited internet (possibly throttled after 5 gigs).
I looked at the decision and summarized it here: http://android.maow.net./ The errors in law were:
The obvious solution is for the government (assuming they are still in fact pro-competition and still support the idea of Wind Mobile operating in Canada) to pass a law removing the requirement that telcos be operated by Canadians.
For a long time, Canada has been ass backwards over how it allows cable and phone companies to operate. When cell phone companies wanted to charge BOTH ways for text messages, members of parliament debated allowing more companies into the country. That got stomped out RIGHT quick. Don't kid yourself, the government is NOT in charge of this country.
Defender of Microsoft and Communism!!!
Bell hasn't had any large tie with US companies since the 60s... I'm not sure what percentage is now owned by foreign interests, but I'm certain it's below the regulatory threshold (on a side note, "Bell Canada" didn't really start off as a subsidiary of Bell in the US, but rather as a separate Canadian entity owned by the father of Alexander Graham Bell who did a lot of his original work in Canada.)
I know that Verizon used to own the maximum legally allowed amount of TELUS stock (I seem to think it was about 30%) however they recently got rid of that because Canadian laws wouldn't allow them to go any higher, and they really wanted more than just a small share.
All the major Canadian telecom companies are in favour of allowing foreign ownership. They just want the rules to be the same for everyone, that's what pisses them off so much about Globalive, the fact that an exemption was given to one company but the law was left unchanged causing other companies to be at a disadvantage.
Now as to whether or not the rule itself is a good idea, that's a different argument entirely. Originally the worry was that foreign ownership of telecommunications companies would allow foreign interests to control who we communicate with and how, this is not generally a good thing, national security, national sovereignty, and all that jazz. However I believe that as long as telecommunication companies are limited to simply providing communications, and stay out of the business of controlling what you use them for, then it shouldn't matter who owns the companies, and competition is generally a good thing. With that in mind, I personally believe that the right answer is to remove the foreign ownership requirements, but only in conjunction with strong net-neutrality/common carrier legislation. (Allow anyone to compete, and nobody to control)
Now I think the rules may need to be different when you look at companies that produce media as well (such as Bell who own CTV) because providing communications infrastructure is one thing, providing the content to fill it is something different, and maybe the rule would have to state that companies producing media follow different rules than those simply carrying whatever signals people choose to send.
Uh, no the courts shouldn't just decide that they don't like the law and won't enforce it. They should be enforcing the letter of the law, because if the letter of the law isn't in line with the spirit of the law, then the law should be changed.
If the courts have the power to decide what's legal based on their own gut feeling, then they are effectively making the laws, which is something that parliament should be doing.
And neither should parliament (especially not a minority government) should be able to dictate what should happen without following the law.
So the Tories want to let this company operate in Canada. The courts say "Hey, that's actually against the law". The next step is for the Tories to change the law. At which point the courts say "yup its all good legally now". A change to a law should be debated in parliament, not changed by a some appointed judges that disagree with it.