Quebecor President and Chief Executive Pierre Karl Péladeau speaks to the media after appearing at the Standing Committee on Industry and Technology on Parliament Hill, on Jan. 25.Dave Chan/The Globe and Mail
Quebecor Inc. QBR-B-T has been working with Ottawa to iron out details of its pledge to reduce wireless prices, including penalties if it breaks its promises, after acquiring Freedom Mobile as part of Rogers Communications Inc.’s RCI-B-T proposed takeover of Shaw Communications Inc. SJR-B-T, sources say.
Federal Industry Minister François-Philippe Champagne’s approval is the last regulatory hurdle that Rogers and Shaw need to clear before they can close their $20-billion deal, which was announced nearly two years ago on March 15, 2021. The deal would allow Quebecor’s Videotron Ltd. to expand outside of Quebec by acquiring Shaw’s Freedom Mobile, Canada’s fourth-largest wireless carrier, for $2.85-billion.
Mr. Champagne has also been in talks with Rogers in recent days to solidify the details of its pledge to spend $1-billion rolling out high-speed internet to rural, remote and Indigenous communities, according to three people familiar with the discussions. The Globe and Mail is not identifying the sources because they are not authorized to publicly discuss the matter.
The Globe previously reported that Mr. Champagne has asked Rogers and Quebecor to sign written undertakings that impose penalties if the companies do not fulfill their commitments to improve the affordability and accessibility of telecom services.
Mr. Champagne, whose department is reviewing the transfer of Shaw’s wireless licences to Videotron, has repeatedly stated that his goal is to ensure that the takeover results in lower cellphone bills.
The three companies have had to extend the deadline for their transactions a number of times because of regulatory issues, and are currently aiming to close the deal by March 31.
When asked by reporters last week why the process is taking so long, Mr. Champagne said he wants to ensure that the decision he makes is in the best interests of Canadians.
“When we have what we want, we will be able to announce it to Canadians and obviously render the decision,” he said.
A spokesperson for Mr. Champagne said the minister will render his decision “in due course.”
Rogers declined to comment, while a representative of Quebecor said the company is continuing to work with the government to obtain approval.
The Globe previously reported that the negotiations between the telecoms and the federal government have included discussions about reducing the domestic roaming rates that are charged when Freedom Mobile customers roam on the Rogers network.
Wireless carriers use domestic roaming agreements to fill in gaps in their networks by allowing their customers to connect to competitors’ towers. The resulting fees are borne by the carriers but ultimately passed down to customers via higher cellphone bills.
Access to cheaper domestic roaming rates would make it easier for Videotron to meet its promise to bring down wireless prices to the same levels it currently offers in Quebec. Those prices are, on average, 20 per cent lower than in the rest of the country, according to Mr. Champagne.
Quebecor has also agreed not to sell Freedom Mobile’s wireless licences for at least a decade if it is permitted to acquire the carrier, which serves roughly 1.7 million customers in Ontario, Alberta and British Columbia.
Canada’s wireless prices declined by an average of 2.6 per cent in 2022, according to a report published by Innovation, Science and Economic Development Canada on Friday. Mr. Champagne said in a statement that he was pleased to see the decline, but “there is still more work to do.”
With a report from Robert Fife
Alexandra Posadzki