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CRTC Pushes Bill of Rights for Consumers

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Tuesday October 23, 2012
Earlier this month, the Canadian Radio-television and Telecommunications Commission invited the public to help create a national code of conduct for wireless companies such as Bell, Rogers, and Telus. The consultation is expected to generate widespread interest, providing frustrated consumers with an outlet for grievances on lengthy contracts, problematic terms and conditions, exorbitant roaming costs, or onerous cancellation fees. 

My weekly technology law column (Toronto Star version, homepage version) notes the decision to embark on a national, enforceable code of conduct for wireless services supported by the wireless carriers represents a dramatic policy shift that was scarcely imaginable only a few years. Indeed, when then-Industry Minister Maxime Bernier pushed through a policy direction to the CRTC in 2006 aimed at limiting regulation by calling for "greater reliance on market forces", consumer-focused regulations were viewed as an impossibility. Consistent with the market-led approach, the Canadian Wireless Telecommunications Association introduced a voluntary code of conduct in 2009 with no expectation of government regulation.

The move toward new regulations provides a valuable lesson on the role that the provinces can play to jumpstart otherwise stagnating issues. In the case of wireless services, the introduction of provincial consumer protections geared specifically toward the wireless sector ultimately encouraged the carriers to drop their opposition to new regulation as they recognized that a uniform federal policy was preferable to the emerging piecemeal provincial framework.

The provincial shift started in the province of Quebec, which enacted new consumer protections in 2010. Those protections included safeguards against pricey termination fees, prohibitions against unilaterally changing terms of service, and greater disclosures about warranties. The wireless carriers unsurprisingly opposed the new rules, claiming they would result in higher consumer costs and delayed access to new smartphones and other devices.

Those claims proved unfounded and the Quebec initiative was quickly followed by similar developments in Manitoba and Ontario. In Manitoba, a consultation on new consumer protections was roundly criticized by the Canadian Wireless Telecommunications Association, which said "the rationale for provincial intervention in the telecommunications sector is not compelling, and that at the end of the day, consumers are better served by competition than by regulation."

Interestingly, the CWTA submission revealed as an emerging divide within the wireless industry. Mobilicity, one of the new wireless providers, publicly chastised its own association with a release stating that "we are exceptionally disappointed with the CWTA's lack of foresight in continuing to act only in the interests of the Big Three wireless oligopoly. As a members of the CWTA, we repeatedly voiced our opposition to its submission to no avail."

Months later, the momentum for wireless consumer protection moved to Ontario, where Ontario MPP David Orazietti had been waging a campaign for safeguards against high cancellation fees, expiring pre-paid cards, incomprehensible contracts, and carrier-locked phones. The government supported an Orazietti private members bill, over the objection of the industry, which maintained "we don't think legislation like this is needed to satisfy customers and meet their demands."

With Nova Scotia and Alberta emerging as the next provinces to develop enforceable, provincial-based wireless consumer protection laws, earlier this year the industry admitted that the provincial regulatory approach was worse than a single enforceable code. It therefore reversed its position and asked the CRTC in March to establish a national code of conduct.

The new national code will come from a new CRTC, however. Since the appointment of chair Jean-Pierre Blais, the Commission has gone out of its way to prioritize consumer concerns. Assuming the public rallies behind the consultation, the process is likely to place the carriers on the defensive against a litany of consumer complaints with a resulting code that provides consumers with new legal rights and a regulator prepared to enforce them.
Comments (8)add comment

Crockett said:

"The wireless carriers unsurprisingly opposed the new rules, claiming they would result in higher consumer costs and delayed access to new smartphones and other devices ... Those claims proved unfounded.

Go Figure!

For all the flack that gets thrown at the media industry, the tech sector can be just as bad or worse. Will mutual cooperation ever overcome self interest? Let's hope the new CRTC can help bring some sanity back to the game.
October 23, 2012

Matt said:

"[T]he rationale for provincial intervention in the telecommunications sector is not compelling, and that at the end of the day, consumers are better served by competition than by regulation."

So, the CWTA would support relaxing foreign ownership rules then?
October 23, 2012

Jean-François Mezei said:

It is clear that the trigger for this was the CWTA's request for national standards.

But I think the CRTC may be using this as a means to re-enter the mobile market which it had pretty much handed over to Industry Canada in the 1990s.

Now, if only the government stopped seeing spectrum as a cash cow, perhaps that would really help lower consumer rates charged by the incumbents. The billions they spend on the spectrum auctions have to come from somewhere.
October 23, 2012

Jim said:

The rationale for intervention is so compelling that the day after the CRTC nixed Bell-Astral Moody's gave the thumbs up to BCE bonds because "Bell Canada avoids re-regulation risks with CRTC denying the Astral acquisition"

October 23, 2012

pat donovan said:

to libel or not to libel
I LOVE BC politics...

I sat thru bill 3 by son of wacky.. Listened to the nasty stories from
other premiers..
collected taxi-license, fish, lumber and health care funding,
abolishing min wage, tree registry, etc etc.. stories

You go, BC. I'd live there except my works never sold well. (at all)

I don't think canada can live without you.

Now for some more exported que violence +poverty stories. (gangland
bc, take note. Your traffic is about to be quotaed.)

Block the china treaty! Harper, like any other pol, will promise
ANYTHING. (and hope he gets away with it)

pat donovan

secret courts, settlements, 31 year duration, abiltity to challenge
ANY municipality city, provincial jurisdiction..

read the secret courts part again. This china treaty is a horror


and you would NOT believe the current libel laws in BC. INSANE!
October 24, 2012

Doog said:

cancelling plan keeping number
Add this to it: when cancelling a cell phone plan, and transferring your number to another provider, you can do so without having to pay for an extra month on the carrier you're leaving (you pay the remainder of the current month etc). The big 3 charge an extra month (30 days) after you leave; AND if you try to cancel 30 days ahead of time they won't allow you to transfer your number! It's a blatant money grab, justified by an asinine accounting system.
October 24, 2012

A said:

Canceling cell phone plans
I recently canceled my old cell phone plan, I had maybe five days left in my contract with my original provider. I transferred over to the new company, and received a nasty surprise for my old phone company. They charged me for the month (which I expected) and an early cancellation fee which was over a hundred dollars on top of that (I didn't expect).

So far I'm happy that I changed over, no unexpected problems with the new company.
October 25, 2012

Gregg said:

I Tried Spreading The News
On wireless support forums... not surprisingly, every post regarding it was deleted.

Fido was the worst.
October 27, 2012

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