Federal Court to hear telco appeals on wholesale broadband rates set by CRTC

OTTAWA — The Federal Court of Appeal says it will hear appeals by telecom companies over the wholesale rates for broadband imposed in August by Canada’s telecommunications regulator.

BCE Inc., Rogers Communications Inc. and other telecom and internet providers appealed to the court after the CRTC concluded a lengthy review of rates by slashing how much large carriers can charge smaller rivals for access to their broadband networks.

Justice Richard Boivin said in rulings filed late Friday that he is “satisfied that there is a serious issue” and that respondents to the appeals, which include smaller internet providers and advocacy groups, made no compelling arguments to the contrary.

Boivin also extended the stay already granted on the new rates until the court makes a final ruling.

The regulator announced in August a new set of rates designed to increase consumer choice, reduce prices and ensure a competitive marketplace across Canada.

The final rates are 15 to 43 per cent lower than the interim rates for monthly capacity, and three to 77 per cent lower for access rates, while the interim rates were themselves up to 89 per cent lower than what the companies had hoped to charge.

Bell Canada responded by saying it would cut back on a rural broadband expansion because of the decision, while Rogers Communications and Cogeco Communications expressed disappointment and said they were reviewing their options.

The phone and cable companies argued in a September filing that the CRTC exceeded its powers and made errors when it set the new rates.

In its submission to the court, Bell estimated that its share of retroactive payments ordered by the CRTC would be about $100 million. A separate filing on behalf of six cable companies estimated their share would be $225 million.

Major telecom companies have also appealed directly to the federal cabinet to have the rates reversed, and to block an order that the new rates be made retroactive to 2016 when the review began.

The companies have warned that investments in expanding their networks would be affected if the rates paid by smaller rivals like Teksavvy Solutions and Distributel Communications are set too low.

Five cable companies including Eastlink Inc., Cogeco Communications Inc., Shaw Communications Inc., Videotron and Rogers launched one appeal, while Bell launched a similar but separate appeal.

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