Wireless code to apply to all consumer contracts June 3: court

The Federal Court of Appeal has dismissed a challenge by wireless providers regarding the date by which the CRTC’s wireless code will apply to all consumer cellphone contracts. On Tuesday, the court said the CRTC has the authority to impose the code on all wireless contracts as of June 3, even if they were signed before its implementation on Dec. 2, 2013. The code stipulates, among other provisions, that no early cancellation fees can be applied to customers who have fulfilled at least two years of a contract. In the decision, posted online by advocacy group OpenMedia, Justice J.D. Denis Pelletier acknowledged that “there are a large number of three-year contracts which will not have matured by June 3, 2015.” If customers “take advantage of the Code by cancelling these contracts before their maturity date, the appellants (the wireless service providers) will be unable to collect early cancellation fees on those contracts even though they may not have fully recovered any incentives offered to consumers to enter into those contracts, incentives which usually took the form of discounted equipment prices,” he said. He noted that wireless carriers, such as BCE Inc., Rogers Communications Inc. and Telus Corp., had argued the CRTC cannot impose the June 3 implementation date “on the ground that it is beyond the CRTC’s jurisdiction to make retrospective rules or to interfere with vested rights.” The Wire Report reported in January that the June 3 implementation date could lead to a “double cohort” effect, potentially involving more aggressive pricing over the summer. Pelletier said that the implementation of the code “is an interference with vested rights and gives the Code retrospective application,” but that the CRTC has the right to impose the code retrospectively. The CRTC had argued that it was in consumers’ best interests that the code be implemented as soon as possible, with a transition period that was “as short as possible,” but the court could not make judgments on whether that is true, he said in the decision. Pelletier noted that it was not the court’s role to question whether “it really is essential that the Code be implemented as soon as practicable,” and that the court could not do so “without engaging in a factual analysis designed to undermine the CRTC’s own factual analysis.” Instead, the court’s role is to examine whether there is a rational basis for the CRTC’s decision, he noted. Pelletier said he was “of the view that the CRTC’s implicit interpretation of section 24 to the effect that it has the right to make the Wireless Code applicable to contracts concluded before the Code came into effect is reasonable.” He added that the decision was limited only to this case, and noted that whether “CRTC has the implied power to legislate retrospectively in any other case remains to be determined when it arises.” Advocacy group OpenMedia said in a press release Tuesday evening that the ruling was a “victory.” Campaigns manager Josh Tabish said in a press release: “It took over a year and a half, but today the court is clear: the customer protections that Canadians fought for in the Wireless Code of Conduct applies to all mobile phone and Internet users across the country. No ifs, ands, or buts about it.” — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca

Wireless code to apply to all consumer contracts June 3: court

News | May 20, 2015

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Wireless code to apply to all consumer contracts June 3: court

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