Federal Court suspends CRTC wholesale rate decision until final judgement

CRTC logo on wall

The Federal Court of Appeal has ruled a suspension of the CRTC’s wholesale internet final rates order pending a final judgement of the court with respect to an appeal case against the regulator.

In documents obtained by MobileSyrup, the court said there are “compelling arguments” made based on appeals filed by Bell and other carriers, including Rogers, Shaw, Quebecor’s Vidéotron, Cogeco and Bragg Communications, which owns Eastlink.

“I am of the view that the irreparable harm branch of the test is not speculative, more particularly with respect to the implementation of the CRTC Order that could result in a permanent market distortion which would be difficult to remedy a posteriori,” the legal decision read.

“The [CRTC Order] dated August 15th, 2019 is stayed pending the final judgement of this court,” the document read.

The court granted a temporary stay in September, which suspended the CRTC’s final rates for the initial part of the proceeding until the Federal Court of Appeal decides whether to hear the appeal made by the companies.

This latest decision means that the temporary stay has been extended “pending the final judgement of this Court.”

“The balance of convenience in the circumstance, [favours] the status quote,” the document reads.

The carriers more recently also filed a petition with the Governor in Council to reverse the decision. Telus joined in on the petition, voicing its opinion for the first time.

Wholesale rates are paid by competitors — such as TekSavvy or Distributel — which then get access to high-speed networks of larger telecommunications companies like Bell, Rogers, Telus and Shaw. Rates are set so that incumbents can charge for this access after the CRTC reviews information regarding how much it costs to operate networks.

Because of the news of the rate change, wholesale competitors quickly took action to lower rates to offer increased value to their customers, while at the same time, larger carriers feel like they’re not getting fair value from the decision.

Tamir Israel, a telecom and technology lawyer, told MobileSyrup when the initial temporary stay was granted that if the court does agree to hear the appeal it “might rely on the same rationale to extend the order for the entirety of the proceeding.”

“[This] would be unfortunate for internet customers and for those wholesale companies who have already announced retail rate reductions,” Israel said.

It would affect companies like Distributel and TekSavvy that have made changes to their services.

Distributel has started to increase home internet speeds “for the majority of its customers at no extra cost,” and is going to launch “competitive new retail pricing for bundled and stand-alone products and services.”

Independent internet service provider TekSavvy announced as well that over 85 percent of its customers are going to receive bill discounts and upgrades because of the decision.

Clarification 22/11/19: The article was updated to clarify how rate changes affected smaller carriers.


  • Shruti Shekar

    Shruti Shekar is a telecom and tech reporter for MobileSyrup. She was formerly a political reporter at The Hill Times based in Ottawa and prior to that was a communications officer for the United Nations High Commission for Refugees. She loves reading, the Raptors, and all the alcohol.