Industry Minister Allan Rock on Tuesday announced that the federal government will be conducting a review of existing restrictions on foreign investment in the Canadian telecommunications market.
Specifically, Rock has asked the Chair of the House of Commons Standing Committee on Industry, Science and Technology to undertake the review, and to have its analysis complete by the end of Februaury 2003. The Committee will determine whether or not Canada would be able to gain investment in infrastructure through a larger investment pool, while at the same time not “comprising its national interests,” according to a statement.
“As we have made clear in our Innovation Strategy, Canada’s marketplace policies must be world-class and encourage firms to invest in the people and capital vital to an innovative economy,” Rock said in a statment. “The telecommunications industry is critical to the development of the knowledge-based economy. We need to be assured that all aspects of its regulatory regime are world-class.”
Canadian telecom companies have complained in the past that the rules governing foreign ownership are too restrictive – that they hinder investment, competition and ultimately affect service improvement for users. Some telcos, such as AT&T Canada Inc., have said Industry Canada should re-jig the system, while other firms have argued that greater foreign investment does not necessarily spell greater competition, improved service or better rates. The rules currently say foreign investors cannot own more than 30 per cent of a Canadian company.
For more information, interested parties can view a discussion paper which has been posted online at www.innovationstrategy.gc.ca.