ON FRIDAY THE 13TH, the large cable companies as well as Bell filed motions in Federal Court requesting leave to appeal the CRTC’s recent decision on Wholesale High Speed Access pricing. Cable companies also requested a stay of CRTC’s decision, meaning that the Commission decision would not apply until the Court issued its ruling.
As there has been much chatter about these appeals, and others which may come, Cartt.ca thought it would shed some light on the various processes.
The Telecommunications Act provide three ways for parties to appeal CRTC’s decisions. It should be noted that the Broadcasting Act provides for two.
Sections 12, 62 and 64 of the Telecom Act allow for parties, the Commission or the Government to seek a different outcome with recourse to Cabinet, the Commission itself and the Federal Court of Appeal.
Timelines
Under Section 12, parties must petition Cabinet within 90 days and then Cabinet has a year to render a decision. (Government can initiate this process on its own, too.)
Under CRTC’s rules of procedure, parties seeking a Review and Vary (R&V), as per Section 62, from the Commission have 90 days to do so. No timeline is set for a decision, however. (The Commission can initiate this process on its own, as well.)
Finally, under Section 64, parties can seek leave to appeal to the Federal Court of Appeal (FCA) within 30 days of the decision. The Courts provide no timelines on when a decision may come.
Criteria
An appeal to Cabinet, under Section 12, to “vary or rescind the decision or refer it back to the Commission for reconsideration of all or a portion of it,” in theory, is not a political process as the decision by Cabinet has to spell out how the decision fails to comply with the Policy Objectives spelled out in Section 7 of the Telecommunications Act.
For R&Vs, under section 62, the Commission has identified in its rules of procedure that “applicants must demonstrate that there is substantial doubt as to the correctness of the original decision, for example due to
- an error in law or in fact;
- a fundamental change in circumstances or facts since the decision;
- a failure to consider a basic principle which had been raised in the original proceeding; or
- a new principle which has arisen as a result of the decision.
Appeals to the FCA, under Section 64, are “on any question of law or of jurisdiction,” where the parties must demonstrate that the process did not follow the precepts of natural justice, or the Commission did not have jurisdiction. Historically, the Courts have given deference to expert tribunals but there is a case before the Supreme Court right now (which also involves Bell Media and the Super Bowl) where the standard of review could be modified.
Process
Generally speaking, all three avenues provide avenues for parties to comment. For example, Telus and SaskTel, which have not filed appeals, could intervene in the FCA process.
Commentary
By providing three avenues to review CRTC decisions, the Act creates confusion and delay. In the case of CRTC Decision 2019-288, it’s no surprise that parties are appealing the decision due to the amounts of money involved – but the number of appeals of late seem to be growing in number, and as one observer noted to us, “The sector is becoming more and more litigious, akin to what we see in the United States which creates costs and delays that hurt the ‘little guys’.”
“The legislative framework within which the CRTC operates therefore makes it appear to be one of the least independent telecommunications regulatory agencies in any OECD country.” – TPR, 2006
It’s interesting to note the Telecom Policy Review Panel report in 2006 proposed to remove appeals to Cabinet arguing “Canada appears to be the only OECD country whose telecommunications legislation empowers government to do both; that is, to provide advance directions on policy matters (the ‘policy direction power’) and also to review and vary, rescind or refer a decision back to the regulator on policy grounds (the ‘Cabinet review power’). The legislative framework within which the CRTC operates therefore makes it appear to be one of the least independent telecommunications regulatory agencies in any OECD country. The government power to intervene in the regulatory process both before and after decisions have been taken has the potential to be detrimental to the integrity of the regulatory process.”
In its Terms of reference, the Broadcasting and Telecommunications Legislative Review, in 2018, asked the questions: “Is the current allocation of responsibilities among the CRTC and other government departments appropriate in the modern context and able to support competition in the telecommunications market?”
And “Does the legislation strike the right balance between enabling government to set overall policy direction while maintaining regulatory independence in an efficient and effective way?”
And in the What we heard report, we read: “Many parties commented that the legislation currently strikes the right balance between enabling the government to set overall policy direction while maintaining the regulatory independence of the CRTC. However, other parties expressed concern that the powers provided to the Governor-in-Council to issue policy directions and hear appeals of specific decisions in the Broadcasting Act and Telecommunications Act allow Cabinet to undermine the overall policy objectives in the Acts set out by Parliament.”
We note that in its submission, Telus, amongst others, recommended the removal of Section 12 along the same lines that of the TPR, 13 years before.
Conclusion
We’re hoping that the BTLR triggers some changes to the Telecommunications Act to reduce the costs in terms of uncertainty and participation to smaller players, the various institutions should exercise more rigour in allowing appeals to process. In the FCA, leave should not be a formality as it is now. The “arguable case” test is too wide and such appeals should be the exception. At the CRTC, R&Vs should not be a way to relitigate the issues and as per the FCA, an R&V should be the exception.
Case in point, the two appeals to Federal Court from the cable companies and Bell offer somewhat different legal arguments and could be treated separately which would increase the cost for consumer associations and smaller players and possibly further delay a “final” wholesale rate.
Let us end on a rhetorical question: if the rates as set by the CRTC are wrong, does the FCA have the expertise to determine the rates are not “just and reasonable”? Does Cabinet have the expertise and does the Commission have the will to admit it made a mistake?
