CRTC Hearings Into Wind Mobile Begin

You might recall that Wind Mobile/Globalive has been the target of a CRTC probe into it’s ownership structure at the request of Telus, and that the CRTC not only went along with the request but fast tracked it as well. Yesterday was day one of the hearings and things to say the least are interesting. The key issue is if Wind Mobile is owned by Canadians or not:

The Telecom Act specifies that carriers must be overwhelmingly Canadian-controlled. Globalive insists that it has satisfied the requirements with a structure where Egyptian-based cellphone company Orascom holds a 65-per-cent equity stake. The arrangement uses a complicated formula that involves two holding companies in which Mr. Lacavera owns the majority of voting shares.

However Rogers, Bell and Telus don’t see it that way:

But Telus vice-president Ted Woodhead and Rogers Wireless executive Ken Engelhart argued Globalive was simply obscuring the fact that Naguib Sawiris, an Egyptian billionaire and CEO of Orascom, was using the company as a pawn to get its hands in the Canadian market.

“The capital structure is not compliant,” Mr. Woodhead said, “and the web of other connections and control can lead to no other conclusion than Globalive has yielded control to non-Canadians.”

The chief of regulatory affairs at Bell Canada, Mirko Bibic, also argued that Globalive does not have a Canadian majority on its board, another legal requirement.

“You’ve got Orascom directly appointing three [board members] and having a say … in the other four,” Mr. Bibic said. “That’s control … that allows Orascom to completely control the operating entity…. We submit that it’s all merely window dressing.”

Regardless of the outcome, expect the losing side of this fight to file some sort of an appeal instantly.

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