Earlier this month, Industry Canada announced new foreign ownership rules for the telecom sector. The current rules were loosened to allow foreign companies to take full ownership of a carrier with less than a 10 percent market share. Citing unnamed sources, The Globe and Mail reports they could take effect before the end of June.
The necessary amendments to the Telecommunications Act will apparently be included in the latest budget implementation bill. A draft of the bill is expected in April and will likely pass through Parliament by late June. Should they not be included in the bill, they could be introduced in a separate piece of legislation although this is described as “unlikely.”
Wireless carriers are likely already preparing for next year’s 700MHz spectrum auction. Smaller players will likely require additional capital to bid and the new rules will open up new investment options.
Underlying the necessity to have the new rules in place quickly is next year’s 700MHz spectrum auction. The government has recognized that it is likely to be “highly competitive and capital-intensive.” Smaller players will need the new rules to secure sufficient capital to bid and secure additional spectrum.
Read more: The Globe and Mail