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Carriers Challenge Parts of the New Wireless Code

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The new wireless code, which has finally put an end to three-year contracts, is months away from being applied, but it is already challenged by some wireless players. If your first thought was “the incumbents”, you are right, but according to a working document obtained by the Globe and Mail, SaskTel and MTS have also joined the line.

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While Canadians have saluted the arrival of two-year wireless contracts as a result of the CRTC’s efforts to regulate the $19 billion telecom market, carriers believe the federal regulator has exceeded its jurisdiction and “erred in law” with the new wireless code.

“The CRTC exceeded its jurisdiction and erred in law by purporting to render the Wireless Code retrospectively applicable to contracts entered into between wireless service providers and their customers before the Wireless Code comes into force on 2 December 2013,” the applicants argue in the notice of motion.

The main issue seems to be the code’s “retrospective application” to wireless contracts. While the CRTC has emphasized that there will be no retrospective application of the new wireless code, the carriers have pointed to a situation that creates confusion: although the new code comes into force in December this year, its provisions apply to contracts no later than June 3, 2015.

This means that if you sign up for a three-year term this July, the carrier won’t be able to recover the entire device subsidy price, as your contract ends after June 3, 2015.

“The application of the Wireless Code to those contracts that terminate after 3 June 2015 is uncertain. This uncertainty has led and will lead to confusion in the marketplace, which will only be resolved once this motion is determined and, if leave to appeal is granted, the appeal is heard and a decision is rendered,” the document adds.

As a result, carriers have decided to file a notice of motion with the Federal Court of Appeal as early as Wednesday. The document will be signed by Rogers, Bell, Telus, SaskTel, and other carriers.

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