Just before recessing for the summer, Parliament passed amendments to the Telecommunications Act that removed foreign ownership requirements for all but the largest Canadian telecommunications carriers.
As we noted previously, the amendments in question provide that Canadian ownership rules will no longer apply to a telecommunications common carrier if the carrier and all its affiliates have total annual telecommunications revenues that represent less than 10% of total Canadian telecommunications revenues, as determined by the CRTC.
Based on total reported revenues for 2010, the threshold below which Canadian ownership rules no longer apply is approximately $4.2 billion, and likely growing. All but the largest wireline and wireless carriers will fall below this threshold, including new wireless entrants, non-dominant carriers, and even several incumbent carriers.
Current rules limit foreign ownership in telecommunications carriers to an effective maximum of 46.7%, reflecting combined maximum allowable interests at the operating and holding company levels. These rules remain in place for larger carriers. Similar rules also continue to apply to broadcasting undertakings licensed under the Broadcasting Act.
The amendments to the Telecommunications Act were included in Bill C-38, the Jobs, Growth and Long-term Prosperity Act, the 425-page omnibus budget bill, which was passed by the Senate on the afternoon of June 29th, receiving Royal Assent and coming into force that same day.