{"id":19019,"date":"2025-03-13T05:14:04","date_gmt":"2025-03-13T09:14:04","guid":{"rendered":"https:\/\/mhgoldberg.com\/blog\/?p=19019"},"modified":"2025-03-12T13:44:27","modified_gmt":"2025-03-12T17:44:27","slug":"foreign-ownership-restrictions-in-turbulent-times","status":"publish","type":"post","link":"https:\/\/mhgoldberg.com\/blog\/?p=19019","title":{"rendered":"Foreign ownership restrictions in turbulent times"},"content":{"rendered":"<p>In view of the current international trade tensions, what are your thoughts on foreign ownership restrictions in Canadian telecom?<\/p>\n<p>That was a question posed to me earlier this week. Over the years, I&#8217;ve talked about <a href=\"https:\/\/mhgoldberg.com\/blog\/?s=foreign\" target=\"_blank\">foreign ownership<\/a> more than 200 times, so I&#8217;d like to <a href=\"https:\/\/mhgoldberg.com\/blog\/?p=19019#respond\" target=\"_blank\">hear your thoughts<\/a>. View this as an invitation to <a href=\"https:\/\/mhgoldberg.com\/blog\/?p=19019#respond\" target=\"_blank\">share your thoughts as a comment<\/a>. <\/p>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.rclegion263.ca\/wp-content\/uploads\/2021\/02\/canada-flag-waving.jpg\" width=\"320\" height=\"198\" alt=\"Canadian Flag\" class=\"alignright size-medium\" \/>Let&#8217;s start by clarifying <a href=\"https:\/\/laws-lois.justice.gc.ca\/eng\/acts\/t-3.4\/page-2.html#h-459912\" target=\"_blank\">the current rules<\/a>, which are often misunderstood. Ownership and Control restrictions are set out in <a href=\"https:\/\/laws-lois.justice.gc.ca\/eng\/acts\/t-3.4\/page-2.html#h-459912\" target=\"_blank\">Section 16<\/a> of the <a href=\"https:\/\/laws-lois.justice.gc.ca\/eng\/acts\/t-3.4\/FullText.html\" target=\"_blank\">Telecommunications Act<\/a>.<\/p>\n<p>In Section 16(2)c), we see that there are no ownership restrictions if the company &#8220;has annual revenues from the provision of telecommunications services in Canada that represent less than 10% of the total annual revenues, as determined by the Commission, from the provision of telecommunications services in Canada.&#8221; In Section 16(6) we see that the company can grow beyond 10% of the telecom market, as long as it grows beyond that threshold organically (ie. not by acquisition). <\/p>\n<p>Earlier this week, <a href=\"https:\/\/crtc.gc.ca\/eng\/publications\/reports\/PolicyMonitoring\/2025\/ctmr.htm\" target=\"_blank\">the CRTC released<\/a> the 2023 market size as $59.6B, meaning the 10% threshold is just shy of $6B. There are only 3 companies in Canada with telecom revenues exceeding 10% of the total market: Bell, Rogers, and TELUS. <\/p>\n<p>Number 4 player Quebecor (Videotron) reported revenues of just over $4.8B in 2024. Other than Bell, Rogers and TELUS, foreign acquisition is permissible. A foreign-owned service provider could be built or assembled by acquisitions (up to $5.96B in revenues) and then grown.<\/p>\n<p>Keep in mind that broadcasting has its own restrictions, creating a <a href=\"https:\/\/mhgoldberg.com\/blog\/?p=18682\" target=\"_blank\">&#8220;poisoned pill&#8221;<\/a> for most converged communications companies, since broadcast distribution (cable or IPTV) is regulated under the <a href=\"https:\/\/www.laws-lois.justice.gc.ca\/eng\/acts\/b-9.01\/FullText.html\" target=\"_blank\">Broadcasting Act<\/a>. There are various creative corporate structures that could enable a competitor to work around the broadcast issues.<\/p>\n<p>What are your thoughts? Would Canada&#8217;s communications infrastructure face increased risk of disruption with lightened foreign ownership restrictions? Benefits? Risks? Are concerns real?<\/p>\n<p>Please <a href=\"https:\/\/mhgoldberg.com\/blog\/?p=19019#respond\" target=\"_blank\">leave a comment<\/a>. You don&#8217;t have to use your real name, but I do require a real email address (which won&#8217;t be posted).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In view of the current international trade tensions, what are your thoughts on foreign ownership restrictions in Canadian telecom? That was a question posed to me earlier this week. Over the years, I&#8217;ve talked about foreign ownership more than 200 times, so I&#8217;d like to hear your thoughts. View this as an invitation to share &hellip;<\/p>\n<p class=\"read-more\"> <a class=\"\" href=\"https:\/\/mhgoldberg.com\/blog\/?p=19019\"> <span class=\"screen-reader-text\">Foreign ownership restrictions in turbulent times<\/span> Read More &raquo;<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","two_page_speed":[],"footnotes":""},"categories":[1],"tags":[],"class_list":["post-19019","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Foreign ownership restrictions in turbulent times &#8226; Telecom Trends<\/title>\n<meta name=\"description\" content=\"In view of the current international trade tensions, what are your thoughts on foreign ownership restrictions in Canadian telecom? 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