By Fax: 613-952-9871

November 9, 1998

Mr. Michael Helm
Director General
Telecommunications Policy Branch
Industry Canada
300 Slater Street
Ottawa, Ontario

Dear Mr Helm: 

Re: Notice No. DGTP-014--98 "Proposed Amendment to the Policy Framework for the Provision of Mobile Satellite Services" Canada Gazette, Part I, October 10, 1998

Canadian Satellite Communications Inc. ("Cancom") is pleased to provide its comments in response to Notice No. DGTP-014-98 (the "Notice").

Cancom is well known to the Department as a major provider in Canada of fixed satellite services using space segment facilities leased from Telesat Canada. As the Department is aware, Cancom is also an important provider of mobile satellite services ("MSS") in Canada, having offered the OmniTRACS service to the Canadian transportation industry for some eight years. Using Ku-band spectrum, the service offers two-way data mobile communications between trucks and their home offices, satellite tracking, as well as a number of fleet management applications. At the present time, Cancom's OmniTRACS service provides tracking and messaging services to about 240 Canadian trucking companies through some 16,000 mobile terminals. Given these activities, Cancom has a substantial interest in the liberalisation of Canada's MSS policy that is proposed in the Notice and in the related amendments to the Radiocommunication Regulations.

Cancom understands and accepts that the commitments Canada has made in the WTO agreement on basic telecommunications services requires a liberalisation of the current requirement that only Canadian-owned and controlled service providers can be granted the necessary licences under the Radiocommunication Act to provide MSS services. Cancom further accepts that, in view of Canada's WTO commitments, the licensing regime for MSS should parallel that for FSS, apar from the difference in dates for phasing in the ownership relaxation (March 1, 2000 for FSS; date of coming into force of the proposed amendment for MSS).

At the same time, however, Cancom believes that it is vitally important to keep in mind that Canada's commitments were made in the context of a multilateral agreement based on reciprocal commitments or undertakings. The liberalisation of Canada's ownership policy with respect to the licensing of MSS service providers must therefore be accompanied by a careful monitoring of developments in other WTO countries and, in particular, thee U.S. where Canadian satellite service providers like Cancom will want to seek out new, and develop existing, business opportunities. Cancom would recommend that whenever a non-Canadian owned and controlled applicant applies to te Department for a radio or spectrum licence to provide MSS services, Departmental officials should routinely inquire of the applicant (as well as make its own independent inquiries) of the extent to which the country in which the applicant's owner resides, has liberalised its own licensing regime, and has authonised Canadian-owned and controlled and other foreign service providers access to its MSS market. Given the commitments made by WTO subscribing countries for transparency in the regulatory process, Cancom believes such inquiries are entirely consistent with the spirit of the WTO agreement.

Cancom would also like to comment on the related changes that have been proposed to the Radiocommunication Regulations, and particularly on certain passages in the Regulatory Impact Analysis Statement (the "Statement"), that explains the proposed changes. In the Statement, it is stated that:

The new provision removes the requirement for Canadian ownership and control of licence holders for earth stations in the FSS and MSS that provide telecommunications services by means of satellites.

The Statement goes on to state:

The new provision excludes

  1. services, i.e. over-the-air TV, radio and cable TV, regulated under the Broadcasting Act and measures affecting such services, and
  2. telecommunications services supplied for the transmission of services i.e. Direct to Home and Direct Broadcasting Satellite, regulated under the Broadcasting Act where such services are intended for direct reception by the public.

In each case, the applicable Canadian ownership and control requirements made under the Broadcasting Act, Telecommunications Act or Radiocommunication Act apply. This is consistent with Canada's GATS-ABT commitments.

While we understand the Statement is merely for purposes of explanation and is not part of the proposed amendments, we believe the Statement may be under-inclusive, in respect of the kinds of services that are excluded from Canada's commitment. The passage quoted above could be interpreted to mean that if a broadcasting service licensed under the Broadcasting Act is not intended for direct reception by the public, it may not be excluded from the new liberalised ownership provisions. As the Department is aware, Cancom provides broadcasting distribution services to broadcasting distribution undertakings ("BDUs") such as cable television systems, and has done so for more than 15 years pursuant to a CRTC licence issued under the Broadcasting Act. Cancom is currently licensed by the CRTC as a satel1ite relay distribution undertaking, or SRDU, and it is Cancom's firm view that the relay of video signals to BDUs for redistribution to the public requires a licence under the Broadcasting Act.

In its submission to the Department dated June 30, 1998, in response to Notice No. DGTP-006-98, in relation to FSS licensing policy and the WTO agreement, Cancom made reference to the CRTC proposal in Public Notice CRTC 1998-60, to allow U.S. satellite operators to deliver U.S. television network signals to BDUs without a licence under the Broadcasting Act.

Cancom reiterates its views made in that submission that the CRTC proposal is a grave threat to Cancom's core business and to the ability of the Canadian broadcasting system to serve remote and underserved areas. Moreover, Cancom contends that the proposal is contrary to law.

In view of that CRTC proceeding, and the passages in the Statement referred to above, Cancom believes the Department may wish to clarify its position to make it clear beyond any doubt that all services regulated under the Broadcasting Act - including SRDU services - are excluded from the application of Canada's WTO commitments.

Cancom appreciates the opportunity to submit its comments on the issues raised above. We would be pleased to elaborate or answer any questions that you may have.

In view of the instructions for filing submissions that relate to the proposed amendments to the Radiocommunication Regulations, we are sending a copy of these comments to Ron Amero.

Yours truly,

Claude Lewis

Executive Vice President

c.c. Ron Amero, Director
Space and International Regulatory Activity
Industry Canada

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