Bell was previously in favour of retroactive payments, TekSavvy argues

BCE Inc.'s argument that retroactive payments mandated by the CRTC in its August wholesale rate decision are an unconstitutional tax is a "disguised attack" on the "entire rate setting regime" laid out in the Telecommunications Act, according to lawyers representing TekSavvy Solutions Inc. Under section 27 of the Telecommunications Act, "every rate charged by a Canadian carrier for a telecommunications service shall be just and reasonable," and is the basis upon which the CRTC regulates rates. On behalf of TekSavvy, Colin Baxter made the argument Friday to the Federal Court of Appeal on the second and final day of an appeal by Bell -- along with Rogers Communications Inc., Quebecor Inc., Shaw Communications Inc. and Bragg Communications Inc. -- of the regulator's August 2019 decision to slash the rates incumbents are allowed to charge for wholesale internet access. Bell had also argued that in deciding to make the rates retroactive to cover the three and a half years the CRTC spent determining the new rates, the regulator had created an unconstitutional tax. The payments to the wholesale-based ISPs, Bell argued in its notice of appeal, "are not collected under the regulatory scheme, and they will not be used to finance CRTC regulation or to alter individual behavior. They are simply a subsidy or wealth transfer from Carriers to Resellers – a tax in the classic sense.” Baxter pointed to several decisions where the CRTC had imposed retroactive payments without objection, including a 2011 wholesale rates decision by the CRTC where Bell argued in favour of retroactive payments. While the regulator did not end up imposing the rates retroactively, Bell had argued for it, Baxter told the court. "It's indicative of a conversion on the road to Damascus," Baxter said. "Clearly back in 2011, their views on the constitutionality of retroactivity were different from what they were today, or indeed different from when they drafted their notice of appeal." The CRTC wrote in the 2011 decision that the decision "ensures that the retail Internet service market will remain competitive, thus allowing the delivery of high-quality services and responding to retail customers’ economic and social requirements." The language from 2011, Baxter told the court Friday, "shows that is alive to and is paying attention to the 2006 direction, and that it has a clear focus in its policy making." "The CRTC can trace its approach in the final rates order back to these foundational policy directions, given in 2011," Baxter said, arguing that it was essential context for the 2019 rates decision. "The final rates order must be read and understood in the context of this seminal policy guidance." Both Bell and the collection of cable companies appealing the rates order had argued on Thursday that the CRTC, in failing to cite the 2006 policy directive in its 2019 decision, had failed to adhere to that directive as required by law. Baxter argued they didn't need to. The decision "is a normal and natural output of the regulatory process. It didn't need the extra language," Baxter said. — With reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Bell was previously in favour of retroactive payments, TekSavvy argues

News | June 26, 2020

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Bell was previously in favour of retroactive payments, TekSavvy argues

News | June 26, 2020

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