Rogers-Shaw Appeal Shot Down by Court, Consumer Group Reacts with ‘Horror’
The Federal Court of Appeal today rejected the Competition Bureau’s appeal of a December 30 ruling from the Competition Tribunal to greenlight Rogers’ long-embattled $26 billion takeover of Shaw Communications — reports The Toronto Star.
Canada’s Federal Court of Appeal found the Bureau’s claims that the Competition Tribunal made four “legal errors” in its decision insufficient to overturn the ruling.
According to the court, the Tribunal made it adequately clear after weeks of hearings that the Rogers-Shaw deal wouldn’t substantially lessen competition and that its decision on the matter wouldn’t change even if it took a different approach to evaluate it.
That’s now how consumer groups and even other telecom operators see it, however. The Public Interest Advocacy Centre (PIAC), a consumer advocacy group based out of Ottawa, said it was “horrified” by the appeal’s instant dismissal.
“The public can only be suspicious that the powers that be want this deal to close – even if it means a decade of high wireless and Internet prices for Canadians,” said John Lawford, PIAC’s Executive Director and General Counsel.
“We also believe that the Court’s ruling means the Canadian Competition Act is utterly broken and needs to be radically rewritten to actually provide tools to block anticompetitive mergers.”
Globalive Chairman and Founder Anthony Lacavera congratulated Competition Commissioner Matthew Boswell for “standing up for Canadians under the deficient Competition Act that has never successfully protected Canadians in 40 years.”
Lacavera also founded Freedom Mobile (then known as WIND Mobile), which was later acquired by Shaw and is now being sold to Quebecor’s Vidéotron as a remedy to competition concerns against the Rogers-Shaw merger. Globalive launched a petition against the merger last week, urging the federal government to stop being “a rubber stamp for billionaires.”
Lacavera added that it is now up to Industry, Science and Technology Minister François-Philippe Champagne to protect Canadians from this anti-competitive transaction.
Congrats to Commissioner Boswell for standing up for Canadians under the deficient Competition Act that has never successfully protected Canadians in 40 years. @CompBureau
Now it is up to Minister @FP_Champagne to protect Canadians from the proposed anti-competitive Rogers/Shaw.
— Anthony Lacavera (@AnthonyLacavera) January 24, 2023
With the Bureau now down and out, the Rogers-Shaw merger only needs Minister Champagne to approve the Freedom-Vidéotron deal in order to move forward.
Minister Champagne said in a statement that he is aware of the court’s decision on the Competition Commissioner’s appeal and will be reviewing it closely.
“Regarding my decision on the request to transfer spectrum from Shaw to Vidéotron, I will
render a decision in due course, Promoting competition and affordability in the telecom sector
has been – and remains – my top priority.”
My statement regarding the Federal Court of Appeal’s ruling on the Rogers-Shaw transaction: pic.twitter.com/ujvwznTVrl
— François-Philippe Champagne (FPC) 🇨🇦 (@FP_Champagne) January 24, 2023
OpenMedia, a consumer advocacy organization that has, along with others, submitted over 83,000 community member messages opposing the merger to policymakers, also condemned the court’s decision.
“The deal the Tribunal accepted is still terrible for ordinary Canadians,” said OpenMedia Campaigns Director Matt Hatfield. “Now Minister Champagne has a choice – will he break with the past and take a firm stand for Canadians? Or will his decision be more of the same?”
TekSavvy, an independent internet service provider (ISP), said in response to the court ruling that “the Rogers-Shaw merger is based on an unlawful side deal with Videotron that will kill competition and raise consumer prices.”
As part of the merger, Rogers has agreed to sell Vidéotron access to its network at significantly lower rates not available to any other players. TekSavvy takes issue with this and last week asked the Canadian Radio-television and Telecommunications Commission (CRTC) to investigate these “unlawful” internet rates.
The Rogers-Shaw merger is based on an unlawful side deal with Videotron that will kill competition and raise consumer prices. The @CRTCeng must investigate and make a decision before @FP_Champagne decides whether to approve the merger. Today's court decision doesn't change that.
— TekSavvy (@TekSavvyBuzz) January 24, 2023
The independent operator argued that a ruling from the CRTC is needed before Minister Champagne makes his final decision. TekSavvy is also urging the Industry Minister to block the deal.
Rogers and Shaw hope to close their merger, as well as the Freedom-Vidéotron sale, by January 31, 2023.