OTTAWA – Well over a year after the proposed merger of Rogers Communications and Shaw Communications was announced, the Competition Tribunal has begun to hear an application made by the Commissioner of Competition to block it.
The Commissioner of Competition is arguing the merger will result in less competition, while Rogers and Shaw are arguing they have addressed that concern by coming to an agreement with Quebecor subsidiary Videotron for the sale of Shaw’s Freedom Mobile as competition concerns are centred around the wireless assets involved in the deal.
According to the commissioner, however, this is not an effective remedy because he claims if Freedom is separated from the rest of Shaw it will be a weaker competitor and argues Videotron will be too dependent on Rogers due to the agreements they have entered into as part of the sale. The commissioner is seeking to have the entire Rogers/Shaw deal blocked.
The evidentiary portion of the hearing, which comes after two attempts at mediation failed, is scheduled to take place starting today for the next four weeks. Oral arguments are scheduled to be heard on Dec. 13 and 14.
During a case management conference at the end of October, Chief Justice Paul Crampton, who is heading the tribunal panel hearing the case, indicated the trial is not going to be straight forward.
“We’re going to have a complicated trial,” he said when asking the parties to explain the consequences of a potentially delayed decision.
Rogers and Shaw warned they are short on time to get this deal approved.
“There’s no extension past Jan. 31 for this transaction,” said Jonathan Lisus, a lawyer for Rogers.
Kent Thomson, a lawyer for Shaw added that there is a “very substantial risk” the delay in a decision would “kill the transaction”. Thomson further told the judge extending into January at all would be a disaster but extending to the end of the month would be “an unmitigated disaster”.
“I really don’t want delay to jeopardize the whole transaction because then effectively the commissioner is going to get the remedy he wants just by virtue of delay, which I can’t allow to happen,” the judge said.
The hearing continues tomorrow at 9:30 a.m. For instructions on how to view it, please click here.
