The history our foreign ownership regulations in telecommunications dates back to the Free-Trade Agreement with the U.S. in 1987 when the policy was adopted to mirror U.S. regulations of the time. The Telecommunications act was drafted in 1993 and regulations came into force for telecommunications foreign ownership in 1994 outlining that companies must be owned and operated by Canadians. However, while other countries have reviewed their foreign ownership regulations, the issue has been put on the backburner here in Canada. The history of this policy is described by the Canadian Centre for Policy Alternatives in the book The Internet Tree. While Canadians were heading telecommunications developments in the past, we are now lagging far behind our global competitors in the developed world. In the end of 2008, Canada actually ranked 27th out of 30 OECD countries for average monthly broadband prices and 25th in download speeds (73.) One of the biggest obstacles we have had to overcome in effectively wiring the country is our size. We have 5 time zones, and the European Union can fit into us twice. This challenging geography required huge financial investments. Previously, in the 1800s, the obvious solution to this was foreign investment. But, there were complaints and problems with this arrangement, some of which were that rural areas were being ignored, service was lacking, prices were too high and foreign owned telecommunications companies eliminated new entrants with anti-competitive prices behaviour (47.) Sounds similar to the complaints we have today. When the government claimed in 1987 that ‘domestic ownership of Canada’s telecommunications infrastructure is essential to national sovereignty and security,’ this made sense to Canadians, but the concerns expressed by Canadians now mirror the concerns from the past, which means the Government’s solution for these problems have yet to fix the problem (and neither have market forces.)
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