TORONTO – Despite how the issue of foreign ownership/investment in Canadian telecom companies has been endlessly debated for what seems like eons – and that there will be yet another governmental report released on the issue this month – there’s to be yet another, albeit short, round of talking about it, Industry Minister Tony Clement said on Monday.
In his opening keynote at the 2010 Canadian Telecom Summit here in Toronto, Minister Clement waxed eloquently on the virtues of the industry in Canada. “Companies in the ICT (information, communications, technology) sector account for about 5% of our gross domestic product, but their products and services drive the competitiveness of the other 95%,” he said. “We need to continue to propel the benefits of ICT into every capillary of our economy, creating a digital advantage through the smart use of these technologies.”
The Minister then noted that: the OECD already considers Canada has the most restrictive policies when it comes to telecom investment from outsiders; the Conservative-appointed Competition Policy Review Panel said two years ago that telecom companies need easier access to foreign capital; the recent Speech from the Throne by his government said that Canada had to further open its doors to foreign investment in telecom and satellite; and the Standing Committee on Industry, Science and Technology will file its report on foreign direct investment very soon – after a few months of hearings it held this past winter and spring.
And yet, it’s not quite enough. “In the next few days, I will be releasing a consultation paper on this subject as well,” said Minister Clement, who quickly added that the government remains committed to opening up avenues for more direct foreign investment in the sector. Then, “we will have a relatively short, but important, discussion period in the next few days, commencing with the release of the (standing committee) report, so that we can get feedback from both the industry and Canadian consumers.”
The discussion will be about three things: access to foreign capital for the big incumbent operators; the smaller, newer entrants to the telecom game (wireless division) in Canada; and how to ensure the capital needs of each can be met, said the Minister.
However, the coming alterations in the potential for foreign investment don’t seem to include broadcasting for the moment (which makes it unclear how it will apply to the Broadcasting Act-regulated cablecos).
“The policy objectives of the Broadcasting Act are primarily social — encouraging the production and availability of Canadian content to all Canadians,” said Minister Clement. “We will not consider anything that might impair our ability to pursue our Canadian culture and content policy objectives.”
However, if more direct foreign investment is okay just for telecom, expect some very loud howling from Canadian cable and broadcasters, who will certainly complain about a very uneven playing field when it comes to access to capital which funds growth and innovation.
They’ll (rightly, it says here) explain you simply can’t open up such resources to one important piece of the ICT industry, but not to all.
As always on this issue it seems, stay tuned.
– Greg O’Brien
