Ottawa to appeal Federal Court's Globalive ruling
Published Tuesday, February 15, 2011 9:44PM EST
Industry Minister Tony Clement announced Tuesday that the Harper government will appeal a Federal Court decision that disputes the Canadian ownership of wireless upstart Globalive.
Speaking to reporters in Ottawa on Tuesday afternoon, Clement said that the Conservative government is "convinced that Globalive is a Canadian company" and that it meets the necessary ownership requirements under the Telecommunications Act.
"We believe that our decision was the right one for Canadian consumers and we defend it vigorously," Clement said.
Globalive was one of several companies that successfully purchased a portion of the Canadian wireless spectrum during a weeks-long auction in 2008.
But the company was initially unable to offer wireless services to Canadians after the Canadian Radio-television and Telecommunications Commission (CRTC) ruled that Globalive did not meet Canadian ownership requirements under the Telecommunications Act. At the time of the CRTC ruling, the Egypt-based company Orascom Telecom Holding owned 65.1 per cent of the equity in Globalive. Orascom's own parent company, Weather Investments has since merged with VimpelCom Ltd., the second-larges wireless provider in Russia.
Ottawa later overruled the CRTC decision in December 2009, when Industry Minister Tony Clement announced that the Conservative cabinet determined that Globalive did meet the necessary ownership requirements.
The decision by the government allowed Globalive to launch its Wind Mobile service, which currently serves about 250,000 Canadian customers.
Anthony Lacavera, the chairman of Wind Mobile, released a statement Tuesday saying the company was pleased with the government's intent to appeal the Federal Court decision.
"From the beginning, Industry Canada and then Cabinet maintained, with a full knowledge and understanding of the facts of our structure, that we are fully compliant with the Telecom Act rules, and we are pleased that the Government is vigorously defending its decision," Lacavera said in the statement.
In January 2010, the Toronto-based cellphone company Public Mobile asked the Federal Court to overturn the government's decision, arguing that Ottawa had "thrown out all the foreign ownership laws" by permitting Globalive to operate.
A spokesperson for Public Mobile told CTV.ca that CEO Alex Krstajic was out of the country at the time of the ruling and had not immediately issued a comment.
Earlier this month, the Federal Court quashed the decision from Ottawa to overturn the CRTC.
The recent Federal Court ruling has a 45-day stay of judgment, which allows Globalive the right to keep operating and figure out its next move during that time.
Clement said it has been a long-standing goal of the Conservative government to give Canadian consumers more choice and to increase competition within the country's wireless sector.
With files from The Canadian Press