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Consumer Groups Oppose Bernier Plan to Deregulate Local Telephone Service

Media Release

FOR IMMEDIATE RELEASE

Monday, January 15, 2007

Consumer Groups Oppose Bernier Plan to Deregulate Local Telephone Service

OTTAWA – Canadian consumer groups in a press conference given today condemned Industry Minister Maxime Bernier’s various manoeuvres seeking to hasten deregulation of local telephone service. The Minister’s proposals ignore the Canadian Radio-television and Telecommunications Commission’s (CRTC) roadmap to competition that took into account the largely dominant position of the established local phone companies and was aimed at permitting the creation of viable competition.

In the past year, Minister Bernier and the present government have variously: called on the CRTC to reverse a major decision on Voice over Internet Protocol (VoIP); proposed an executive ‘Direction’ to the CRTC to rely, notwithstanding contrary indications in telecommunications law, more fully on the ‘free market’ to achieve deregulation; introduced a Bill replacing the CRTCs’s proactive power to determine if large phone companies are anti-competitive with an after-the-fact oversight by the Competition Bureau; and, finally, proposed a Cabinet Order that would lead to premature deregulation of local telephone service. The Canadian Consumer Initiative denounced these Ministerial efforts to minimize the role of the CRTC, which is charged with consumer protection oversight in telecommunications, and to substitute political judgment for decisions and frameworks painstakingly arrived at by the CRTC after extensive quasi-judicial public hearings.

The Canadian Consumer Initiative (CCI) further denounced the role of the Minister in appearing to serve only the interests of the major telephone providers: Bell Canada, TELUS, Bell Aliant, Sasktel and MTS Allstream. Contrary to the Minister’s statements, the CCI contends that the proposed rapid deregulation of local telephone service, including removing pricing and quality of service constraints, will not promote competition and will not provide better service or prices to consumers.

“These actions defeat competition before it even starts and cement the position of the big telephone companies” said Charles Tanguay, Deputy Director and spokesman of Union des consommateurs. Tanguay added that “Captive subscribers will end up paying for the Conservatives’ telephone policies.”

The consumer groups denounced in particular the Minister’s recent draft Cabinet Order overturning a recent CRTC decision on how local telephone service markets would eventually be deregulated. Although the draft Order called for public consultation, it was unveiled only days before the holiday break and allowed only 30 days for comment – a strategy the CCI said was designed to discourage comment and which stands in stark contrast to the extensive examination of the issue by the CRTC. “The test in the draft Cabinet Order for the presence of adequate competition to allow near-total deregulation in local phone service has no relation to any consumer recommendations” said John Lawford, Counsel for CCI member the Public Interest Advocacy Centre, which appeared before the CRTC on the question. “I call it the ‘vain bubble’s shadow test’ of competition, for which consumers will have to pay.”

The CCI further demanded that the Minister respect the democratic processes of Parliament and permit the Industry Standing Committee to examine the Minister’s efforts at telephone deregulation. The Committee has called for public hearings on the draft direction to the CRTC.

The Canadian Consumer Initiative is a coalition made up of six major Canadian consumer organisations: the Alberta Council on Aging Services, Automobile Protection Association, Consumers Council of Canada, Option consommateurs, Public Interest Advocacy Centre and Union des consommateurs.

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For more information:

Charles Tanguay
Directeur-adjoint – Responsable des communications
Union des consommateurs
6226, rue Saint-Hubert
Montréal (Québec)
H2S 2M2
Tél.: 514-521-6820 poste 257
Cell: 514-743-0419
Télécopieur: 514-521-0736
Tanguay@consommateur.qc.ca

 

John Lawford
Counsel
Public Interest Advocacy Centre
ONE Nicholas, Suite 1204
Ottawa, ON
K1N 7B7
Tele No. 613-562-4002×25
Fax No. 613-562-0007
jlawford@piac.ca

Please see also: PIAC Comments on Cabinet Reversal of Local Forbearance Decision [pdf file: 0.13mb]

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