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Canadian minister Champagne flattens moves to Rogers-Shaw merger

François-Philippe Champagne Canada.jpg

The Canadian government is trying to block Rogers Communications’ attempt to buy rival Shaw Communications ahead of negotiations with the country’s Competition Commissioner.

François-Philippe Champagne (pictured; picture: Radia Canada), Minister of Innovation, Science and Industry, has officially denied a request to transfer licences from Shaw to Rogers, a move that would have permitted the merger to work.

Champagne had already warned of such a move, which he called “the wholesale transfer of wireless spectrum licences from Shaw to Rogers”.

He said: “My decision formally closes that chapter of the original proposed transaction. As you’ve heard me say many times before, I will never waver in my commitment to promote competition and make wireless services more affordable for all Canadians.”

Champagne noted that, “since the original request was tabled, Shaw has proposed to sell its wireless division – Freedom Mobile – to Vidéotron. This would require my approval to transfer the spectrum licences.”

He said that “any new wireless licences acquired by Vidéotron would need to remain in its possession for at least 10 years. A new service provider needs to be in it for the long run.”

And he called for lower prices. “I would expect to see prices for wireless services in Ontario and western Canada comparable to what Vidéotron is currently offering in Québec, which are today on average 20% lower than in the rest of Canada.”

He said: “Wireless services are essential to our daily lives. They keep us connected to the world around us, to our loved ones and to our jobs. Canadians deserve world-class networks and access to wireless services at affordable and competitive prices. I am resolved to achieve these objectives – full stop.”

But in the Toronto Globe and Mail, writer and political commentator David Moscrop suggested that the outcome may yet be a merger. He suggested that Champagne “stipulated conditions for a deal the federal government could accept. A new arrangement would need to include lower rates for customers in Ontario, Alberta and British Columbia, comparable with those offered in Québec.”

Moscrop added: “It would also require Quebecor’s Vidéotron to hold the wireless licence for Freedom Mobile for a decade, which it must also acquire from Rogers by way of Shaw for the deal to go forward.”