Canada blocks Telus' bid for Mobilicity licences

Canada’s government has blocked mobile operator Telus’ application to acquire Mobilicity’s spectrum licences. Telus agreed to acquire the smaller Canadian operator for $380m in May, pending regulatory approval. Mobilicity has over 250,000 subscribers and 150 employees, according to Telus.

Christian Paradis, minister of industry for Canada announced the decision as Mobilicity’s licences were among those set aside for new entrants in the 2008 Advanced Wireless Services (AWS) auction. The allocation of those licences included restrictions on transferring licences to incumbents.

“Our government has been clear that spectrum set aside for new entrants was not intended to be transferred to incumbents. We will not waive this condition of licence and will not approve this, or any other, transfer of set-aside spectrum to an incumbent ahead of the five-year limit,” said Paradis.

“Our government will continue to allow wireless providers access to the spectrum they need to compete and improve services to Canadians. We are seeing Canadian consumers benefit from our policies and we will not allow the sector to move backwards. I will not hesitate to use any and every tool at my disposal to support greater competition in the market.”

The Government also updated its policy regarding spectrum licence transfers. In future, proposed spectrum transfers that result in undue spectrum concentration, and diminish competition, will not be permitted. The policy will apply to all commercial mobile spectrum licences, including the 2008 AWS licences.

In light of these decisions, the application deadline for the 700 MHz auction has been extended to September 17, 2013, and the auction will commence on January 14, 2014.

The news follows the announcement of a code of conduct for mobile operators, issued by telecoms regulator the Canadian Radio-television and Telecommunications Commission (CRTC). The new code is an attempt to make it easier for subscribers to understand their contracts and their basic rights.

In April this year, Mobilicity was among the three Canadian operators that announced their withdrawal from industry body the Canadian Wireless Telecommunications Association (CWTA). Wind Mobile and Public Mobile joined Mobilicity in voicing their mounting frustration with the CWTA’s “consistent bias” in favour of Rogers, Bell and Telus on a wide variety of issues.