A federal appeals court has rejected the Competition Bureau’s efforts to overturn the primary authorization for Rogers Communications Inc.’s acquisition of Shaw Communications Inc.
Court of Appeals Judge David Stratas said Tuesday that the agency’s allegations do not meet the criteria for material error to the point of the lawsuit required to overturn a competition court decision to approve a $26 billion deal. Stated.
“It’s a high threshold. It’s not enough to just pull the leaves and branches to keep the tree upright, you have to bring down the whole tree.”
In its December 30 approval, the competition court made it clear that the deal is unlikely to hinder or significantly reduce competition, Stratas said.
“Had the competition tribunal erred on the narrow legal point that the Commissioner is currently raising before this tribunal, I am not convinced that the outcome could have been different. Remanding it to court is pointless.”
The Competition Bureau’s allegations focused on what it claimed were four major legal errors, with particular focus on how the show’s proposed sale of Freedom Mobile to Videotron influenced the court’s decision. was
Bureau attorney Alexander Gay argued that the court should have evaluated the transaction as originally proposed before adding the sale of Shaw’s Freedom Mobile to Quebec-owned Videotron.
Gay said the deal would not have gone through if it had been assessed as a remedy for competitive concerns rather than as an integral part of the deal.
“Almost entirely a series of service agreements between competitors. They weren’t considered,” said Gay.
“That’s a big mistake, and I think it gives enough doubt that in this case it should really be sent back for that very reason.”
Judge Strata said investigating only a merger that could not move forward without the sale of Freedom Mobile was a “foray into fiction and fantasy” and that the court was not bound by the deal’s previous structure. rice field.
The transaction, which Rogers hopes will be completed by January 31, is subject to approval from the Minister of Industry, François-Philippe Champagne.
In a statement, Champagne said it is reviewing the Federal Court of Appeal’s decision and will eventually make a decision on the transaction.
“Promoting competition and affordability in the telecommunications sector was and remains my top priority,” he said.
Rogers Communications, Shaw Communications and Quebecor applauded Tuesday’s court ruling.
“We welcome this clear, unambiguous and unanimous decision by the Federal Court of Appeal,” they said in a joint release.
“We will continue to work with Innovation, Science and Economic Development Canada to complete a competitive transaction to create a stronger fourth wireless operator in Canada and a stronger wireline competitor. to secure the final approval required for
Advocacy group OpenMedia said in a statement that the deal would mean fewer options and higher prices.
“The deal that the court accepted is still terrible for ordinary Canadians,” said Matt Hatfield, director of OpenMedia campaigns.
He called on Champagne to block the deal and instead set lower rates for internet service providers to access its internet infrastructure.
The House Industry and Technology Committee, which had previously recommended against the deal, plans to meet Wednesday to reconsider the deal.
Competition Commissioner Matthew Boswell said he was disappointed by the ruling.
“While today’s developments are disappointing, we stand by the results of the investigation and the decision to contest the merger,” he said in a release Tuesday evening.
“After a thorough investigation of the facts, we brought a strong and responsible case to court.”
Boswell said he continued to disagree with the court’s findings, but accepted the decision and would not pursue further appeals.
This report by the Canadian Press was first published on January 24, 2023.