With the Government blocking an outright acquisition of Shaw by Rogers, the parties still need to persuade competition authorities that a deal should be allowed
Regulator revises its decision on wholesale mobile access: On 19 October 2022, the Canadian Radio-television and Telecommunications Commission (CRTC) approved the conditions for wholesale access for mobile virtual network operators. National operators Bell, Rogers and Telus and regional provider SaskTel must now open up their networks to potential MVNOs, entering into negotiations with access seekers on regulated terms. The operators must negotiate access rates commercially but in good faith, with the CRTC ready to step in as arbitrator if no agreement can be reached. In April 2021, the regulator determined that wholesale access should only be available to regional operators with their own infrastructure and spectrum, although this decision was criticised as being insufficient to drive competition in the mobile market. In contrast, mandated MVNO access has rarely been imposed in regions such as Europe, where this market is no longer considered susceptible to ex-ante regulation.
Measures reflect the Government’s pro-consumer policy direction: 18 months since its original decision, the CRTC has hailed its latest move as a key step towards improving choice and affordability for Canadians. According to the regulator, although mobile prices are generally falling, competition remains limited and there are barriers to entry for new providers. These issues have provided the impetus for the Government to adopt a more consumer-oriented approach to policy in the telecoms sector. The regulator expects its measures will accelerate competition in new areas as regional mobile operators rollout their networks while:
Opening the door for more companies, in particular smaller regional providers in rural areas, to provide greater competition and choice to more Canadians;
Ensuring that the calls and data sessions of MVNO subscribers do not drop when they move between coverage zones;
Ensuring that MVNO access is offered on current and future mobile networks, including 5G;
Prohibiting provisions that would make MVNO access more restrictive or difficult to make use of; and
Preventing provisions that would restrict regional providers from reselling their wholesale access to other MVNOs.
Rogers/Shaw merger incompatible with the pursuit of greater competition: A week after the decision, the minister of Innovation, Science and Industry reiterated his stance on a potential Rogers/Shaws merger, signalling that the saga around a proposed combination could soon be reaching its conclusion. In an already highly concentrated market, the minister underlined that the wholesale transfer of Shaw's mobile licences (and spectrum) to Rogers is fundamentally incompatible with the Government's push for greater competition and affordability in telecoms, adding that such a transaction cannot therefore proceed. Ahead of another round of discussions between the parties and Canadian authorities, the minister also outlined the conditions for a sale of Shaw’s mobile unit to Videotron – a deal intended to alleviate competition concerns. Should negotiations fail, and with an outright acquisition of Shaw now prohibited, the parties would begin a Competition Tribunal hearing on 7 November, after which a final decision is expected by the end of 2022.
