The Government of Canada has concluded that Globalive Wireless Management Corp. is a Canadian company that meets the Canadian ownership and control requirements under the Telecommunications Act.
The government has decided to vary Telecom Decision CRTC 2009-678, in which the CRTC found that Globalive did not meet these Canadian ownership requirements, so that Globalive can begin operating in Canada without delay.
Section 12 of the Telecommunications Act gives the Government the power to vary a CRTC decision on its own motion. The variance affirms that Globalive meets the requirements of the Telecommunications Act and is immediately eligible to operate as wireless telecommunications carrier in Canada. This determination is based on an assessment of the facts before the CRTC during the course of its public hearing into Globalive’s compliance.
The test for Canadian ownership and control under the Telecommunications Act is comprised of both legal requirements and a factual requirement.
The Government and the CRTC agree that Globalive meets the requirements. In particular, Canadians own at least 80% of the voting shares of Globalive and 66 2/3 percent of the voting shares of Globalive’s holding company. Also, at least 80% of Globalive’s board of directors are Canadians.
The factual requirement involves assessing whether a foreign entity controls “in fact” the company. Control in fact is the ongoing ability to determine the strategic decision-making or to manage the day-to-day operations of a company.
The variance issued today further affirms that no additional changes are required to the company’s structure and shareholder arrangements, including to its debt and equity financing arrangements and to the composition of its board of directors.
Before making its decision, the Government consulted with provincial and territorial governments, as well as with the companies that participated in the oral phase of the COC proceeding conducted by the CRTC. Their input has been taken into consideration.
In varying the CRTC decision, the Government is not removing, reducing, bending or creating an exception to COC requirements in the telecommunication and broadcasting industries, Industry Minister Tony Clement said in announcing the decision at a press conference in Ottawa this morning.
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