Archived — SPFC — A Spectrum Policy Framework for Canada (Archived Version 2002 Edition)

Licensing

5.9 Licensing Process

The traditional means of radiocommunication development in Canada has been to allocate and designate bands of spectrum to particular radio services and applications and then to subsequently license applicants within each service category.

Processing and assigning of frequencies for radio applications is accomplished by an integrated spectrum management system according to existing spectrum utilization policies, licensing policies, general radio regulations and radio system standards.

Licensing policies are constantly adapting to changes in radiocommunication in order to respond effectively to the evolving competitive environment and user needs.  A number of licensing mechanisms are available to the Minister to assign frequencies. The "First-Come, First-Served" (FCFS) approach is used in instances where there is sufficient spectrum to meet the anticipated demand in a given frequency band and where there is no additional measure required to advance particular telecommunication policy objectives.

The Department may choose to initiate a competitive licensing process in situations where there is, or is likely to be, more demand for radio frequency spectrum than the supply of spectrum available for use in a given frequency band or, where there is a need to pursue certain telecommunication policy objectives.  In certain cases, it could be determined during the initial phase of a competitive process that sufficient spectrum is available to reasonably meet the needs of all applicants and that the licensing could therefore proceed on a FCFS basis. The Department would normally consult to establish the policy framework and design of a competitive licensing process.

The two types of competitive licensing are the use of auctions and the use of a comparative review. Auctions may be used where the Minister of Industry is confident that market forces can be relied upon to select licensees consistent with the public interest. Where such reliance on market forces alone may not be sufficient to achieve public policy objectives, the Minister may consider other policy factors in the public interest such as spectrum set-aside, or spectrum caps, to foster competition and the delivery of services to Canadians.

Eligibility

Generally, the Department fosters open participation in its competitive licensing except for statutory and policy requirements concerning eligibility and competition. In determining the eligibility to participate in a competitive licensing process, the Government will be guided by the requirements of the Radiocommunication Act and Radiocommunication Regulations and give regard to the objectives of the Telecommunications Act and policies made thereunder. More explicit eligibility criteria concerning competition are to be developed through public consultation to be used in competitive licensing processes.

Licensing Policies

Licensing policies ensure the achievement of a number of goals:

  • meeting underlying legislative, policy, economic, regulatory, technical, operational and social objectives;
  • fairness of treatment and consistency of policy application for licensees in all regions of Canada;
  • accommodation of as many users as possible without harmful interference;
  • administrative efficiency in dealing with applications;
  • imposition of the minimum regulatory requirements on the user; and
  • flexibility to respond to changes as they occur.

Policy Guideline 8 — Licensing Process

The use of the First-Come, First-Served licensing process will continue where the Department believes spectrum supply is adequate to meet demand or a reasonable accommodation of all applications can be managed.

In situations where there is, or could be, excess spectrum demand relative to supply or there is a need to pursue certain telecommunication policy objectives, a competitive licensing process, using either a comparative selection or auction licensing approach, will be initiated.

The Department will continue to ensure the necessary general policies are in place to effectively respond to evolving public policy objectives in telecommunications and broadcasting, and to protect existing users and services from harmful interference.  Furthermore, the Department will continue to authorize radiocommunication system trials and new technology experiments.

As well, once radio systems have been authorized, the Department may ensure that these systems are implemented within a reasonable time and radio frequencies are efficiently utilized.  In order to ensure that the radio system is implemented in a timely fashion, the Department may establish as terms and conditions of licence a reasonable period for radio station installation to take place and service to begin.

5.10 Licence Fees

It is government policy to implement user charges for services that provide identifiable recipients with direct benefits beyond those received by the general public, unless overriding policy objectives would be compromised.  The aim is to promote the efficient allocation of resources, to promote an equitable approach to financing government programs and to earn a fair return for the Canadian public for access to, or exploitation of, publicly-owned or controlled resources.

The Treasury Board Document, Cost Recovery and Charging Policy (found at http://www.tbs-sct.gc.ca/archives/opepubs/tb_h/crp-eng.asp), states that prices should be based on market value for the sale, lease or licence of public property as well as for rights and privileges such as spectrum, which are de facto commercial inputs for users. This is aimed at ensuring efficient utilization of a scarce resource and a fair economic return to the general public.

Policy Guideline 9 — Licence Fees 

Licence fees will be based on spectrum management costs where resource rents do not exist. When resource rents do exist, fees will ensure a fair economic return to the public in addition to recovering spectrum management costs.

5.11 Market Based Considerations

The Policy Guideline 11 of the 1992 Framework concerning "Market Based Approaches" is deleted as this aspect is addressed in the modified Policy Guideline 8 on the "Licensing Process".

5.12 Radiocommunication Research and Development (R&D)

Radiocommunication technology has been recognized as a strategic component of communications systems. The Department has had a prime role in the research and development of the satellite communications industry in Canada as well as other spectrum-based technology developments.

R&D is considered a prime mechanism to foster growth of the radiocommunication industry through the development of new technologies, products and services to meet the needs of both the domestic and international radio marketplaces. R&D should advance radiocommunication technologies and foster a more efficient utilization of the spectrum resource to better serve Canadians and encourage a stronger, more prosperous economy.

Policy Guideline 10 — Research and Development

The Department recognizes R&D as necessary for the maintenance and development of the radiocommunication infrastructure and products and services in Canada, and to support a strong Canadian industry. The Department will continue to establish radiocommunication R&D requirements whenever appropriate. These requirements will be developed in consultation with industry prior to licensing.

5.13 Radiocommunication Standards

Conformance to standards is required in order that radiocommunication systems operate without harmful interference. Conformance also maximizes sharing among different services, ensures compatibility among different users, facilitates international co-ordination and, as well, effective spectrum management.

The Department recognizes that equipment standards are essential to support the introduction of new and innovative wireless technologies and services in an increasingly competitive and global market. These standards should be developed in consultation with manufacturers, service providers and users and should be harmonized regionally and globally to the maximum extent possible. In addition, the Department recognizes the need to ensure that the specific needs of security, safety and international obligations are covered in the applicable standards. As well, the Department may take appropriate action where competition or the interests of consumers may be affected by standards-related considerations.

Policy Guideline 11 — Radiocommunication Standards

Standards and conformity assessment procedures facilitate compatibility and interoperability, avoid interference and promote efficient spectrum management and utilization. The objective is to align Canadian standards and conformity assessment procedures to the greatest extent possible with international standards.  Harmonization of radio system standards is an important consideration in this process.

Mandatory standards and conformity assessment procedures should be compatible with international agreements and arrangements to which Canada is a signatory and they should include only those requirements which can be demonstrated to be necessary for good spectrum management.

Planning and Consultation (National and International)

5.14 Spectrum Resource Planning

Under the Radiocommunication Act, Section 5.(1)(e), the Minister of Industry is responsible for planning the allocation and use of the spectrum. To carry out this function, the Department collects information, including statistical, on spectrum use and efficiency and its availability in various locations. It also assesses the impact of the introduction of new technologies, and market trends. This function is carried out by internal and contracted studies as well as from soliciting input from interested parties.

Since the publication of the 1992 Framework, there has been recognition of the necessity to make information on the Department's future plans to reallocate spectrum available to the public on a regular basis. This would include the time frames of making such reallocated spectrum available for various new or expanding services.  In addition to demonstrating openness in the planning process, it is the Department's belief that this information is vital for existing licensees as well as applicants in a competitive licensing process. This information is presently made available through the publication of the Guidelines on the Licensing Process and Spectrum Release Plan (http://www.ic.gc.ca/eic/site/smt-gst.nsf/eng/sf01853.html).

Policy Guideline 12 — Spectrum Resource Planning

Planning of spectrum resources will continue to be a prime activity of the Department to support the process of allocating adequate spectrum for various existing and new services.  The Department will publish on a regular basis a forecast of spectrum resources and associated time frames of making additional spectrum and satellite orbital positions available for the benefit of all Canadians.

The Department will continue to exercise a leadership role in planning and consultation at a national and international level to judiciously plan the spectrum resource.

5.15 Public Consultation

The Department has an ongoing need to consult the public, interested individuals, organizations, and affected parties on various policy issues regarding the development and formulation of policies, standards and procedures to realize the greatest public benefit.

The use of notices, published in the Canada Gazette, has been the formal instrument employed by the Department in the past to initiate comment, to apprise or inform the public, and to obtain representation on significant issues. Over the last few years, the Department has greatly expanded the use of the Internet as a means of making announcements, as well as disseminating and collecting information. This has facilitated the public's access to this information in a timely manner and expedited the process of transmitting public comment. The Department will continue to use the most modern means for the dissemination and collection of information to and from the public.

In order to make sound decisions on spectrum matters, the Department employs a systematic review process, which includes the public consultation mechanism discussed above. This process addresses all aspects of radiocommunication including national and international policy, allocations and licensing, and procedures and standards. In addition, the Department promotes the use of government/industry technical committees and has established ongoing relationships with major industry associations and user groups.

Policy Guideline 13 — Public Consultation

The Department will continue to use the most modern means to disseminate and collect information and ensure that appropriate mechanisms are in place to allow interested parties to provide input to the Department on spectrum matters.

5.16 International

The Canadian government, industry and other concerned organizations participate in international and regional organizations to represent Canadian interests on spectrum matters.

On a global scale, the ITU establishes frequency allocations and regulations for the use of the spectrum and the processes for the coordination of frequency assignments. The ITU also develops an extensive set of recommendations for radio systems characteristics and spectrum use. On a regional scale, the principle body to address spectrum use is CITEL, which deals with spectrum and standards issues in the Americas and also advocates these views at the global level.  The Department also represents Canada at meetings with other administrations on spectrum issues. 

Since the publication of the 1992 Framework, we have increasingly operated in a global economy.  Canada must look beyond traditional national and sub-regional boundaries to take into account developments in markets, spectrum planning and spectrum management techniques.

Policy Guideline 14 — International

The Department will continue to exercise leadership and commitment to Canadian involvement in regional and international spectrum matters, including those involving national security and economic/market considerations. The marketing of Canadian expertise and products will be done in concert with private industry.

5.17 New Spectrum Approaches

Since the publication of the 1992 Framework, the Department has carefully considered new approaches and techniques in the development of spectrum policy and spectrum management and has adopted a number of changes. There are other examples of change such as the use of the Internet to deliver services to the public as well as to enable easier and quicker access to information. The Department has put a particular priority on establishing Mutual Recognition Arrangements with other countries to facilitate the process of obtaining certification for equipment approval. The use of market-based tools such as auctions to recover the fair market value for the use of the spectrum is an example of a new approach in radio licensing.

The Department resolves to maintain an open-minded approach to new ideas, techniques and facilities.

Policy Guideline 15 — New Approaches for Spectrum Policy Development and Spectrum Management

The Department will encourage new approaches to spectrum policy development and spectrum management, and will endeavour to assess these on a continuing basis and implement where warranted.

6. Concluding Remarks

The original Framework published in 1992 laid out a set of core policy objectives, which formed the foundation for a strategic Spectrum Policy Framework for Canada.  As well, key policy guidelines were provided in areas related to spectrum policy and management. The Department's view is that the 1992 Framework served Canada well. However, there have been a number of changes in spectrum policy developments and spectrum management practices that warranted a revision to the Framework. The modifications to the Core Objectives and Policy Guidelines made to the present document are based on changes to the spectrum policy and management regime that have already been the subject of public review. Nevertheless, Industry Canada will consider any public comments on the completeness of the updating of the 1992 Framework, in a future revision or amendment.

7. Next Steps

Looking towards the future, the Department anticipates a number of profound changes in telecommunications. In view of this situation, the Department believes that it is also timely to commence a process of public discussion that will lead ultimately to a revamped Framework.

Date modified: