Von Finckentstein appointment likely only first move from Conservatives

The federal Conservative government started its makeover of the CRTC last week by appointing Konrad von Finckenstein as the tribunal’s chair on January 25.Von Finckenstein has a long and distinguished career in the public service, particularly in the domain of competition law and free trade. In addition to heading up the Competition Bureau of Canada for five years, he was the assistant deputy minister for free trade policy at Foreign Affairs and International Trade, as well as the coordinator for the implementation of the North American Free Trade Agreement at the Department of Justice. He was most recently a judge on the Federal Court of Canada. Prior to the announcement of von Finckenstein’s appointment, one industry source commented that the future of the commission would be determined on the basis of the kind of person the government chose as its chair – either it would choose someone who would be charged with winding the organization down or it would choose someone that would reform it to be more in tune with a fully competitive telecom market. If the government wanted someone in place that would steer the commission on a definitive market forces heading, then von Finckenstein is the right choice. The commission now has a chair more likely to take a Competition Bureau approach to regulating the industry, rather than the approach it has taken in the past. And that should please incumbents, which have strenuously argued that telecommunications is an industry like all others and doesn’t deserve special treatment and coddling.The Competition Bureau has recently argued that the CRTC, when forbearing from regulating a telecom market segment, must do so as fully as possible and with very clearly circumscribed conditions, thereby eliminating any jurisdictional ambiguities post forbearance. If von Finckenstein subscribes to this point of view, he may ensure that future forbearance orders issued by the commission set very limited conditions, thereby putting more of an onus on the bureau for the ongoing monitoring of the telecommunications industry. While the new chair has a lot of government, free trade and competition law experience, the CRTC, however, is an expert tribunal serving two industries – telecommunications and broadcasting – that have historically been characterized by an almost lethal mix of complexity, politics and competing interests which has coloured how successive CRTC commissioners have undertaken their mandate. Keith Spicer used the platform of chair to expound on a number of policy issues, seeing his mandate as expansive rather than limited to the narrow confines of interpreting government policy. Charles Dalfen on the other hand stuck to his knitting, so much so that many in the telecom industry grumbled at his micro-management of the affairs of the commission. It’s very early days so it may be a while before we see a coherent vision coming from von Finckenstein’s office. The new chair has little direct experience in either one of the commission’s two regulated industries. During his tenure at the Competition Bureau he dabbled in telecommunications as the agency aggressively went after telemarketers and fraudsters. It also took on the thorny issue of whether Bell Canada was under-pricing its high speed ADSL Internet service to retail customers and overcharging the same service to Internet resellers. The bureau eventually declined to take action in that case. The issue of expertise is one that divides telecom and broadcasting industry observers. One source stated that the commission is an expert tribunal and as such, an expert in potatoes or airlines can’t be expected to understand sufficiently the issues before it. The same should hold true for the commissioners. Others are not so sure. At the cloudy heights of the commissioners and the chair, most, if not all, of the details have been ironed out through a series of discussions among the staff. Issue experts then make their pitch to the commissioners, sometimes in clear language that explains the issues and presents a menu of choices for them to consider. With such an operating procedure, it probably doesn’t matter who the commissioners are, as long as the staff take the time to explain issues in clear, everyday English, along with the requisite consequences of each recommendation. Some industry sources actually think the commission could benefit from a more "CEO approach," where the details remain at the staff level, leaving the commission to focus on the bigger issues. Under such a scenario, von Finckenstein is again a good choice – no industry affiliation at all, so he can be expected to take a more objective perspective on the issues coming before him. Most observers, however, indicated a preference for a commission that strikes a balance between commissioners with telecom and broadcasting experience and those without. Certainly, having a lack of expertise could work against the industry affected.On telecom, the CRTC could be looking at that type of situation later this year. The current executive director for telecommunications Len Katz is scheduled to leave the commission in June 2007. Apparently, his term cannot be renewed. Couple that with Andreé Noël’s departure in October, Dalfen’s departure, and persistent rumours that Richard French wants to or will leave, and the commission could have a serious depletion of telecom expertise. Now that the chair has been chosen, the Conservatives will have to deal with filling the spots to be left vacant in the coming months by Joan Pennefather, Stuart Langford, Barbara Cram and Noël. If the Tories want to expand the commission to its maximum size of 13 commissioners, another two bodies will have to be found. And this raises another issue. Now that accountability legislation is the law of the land, how many credible candidates in either broadcasting or telecom would want to become a commissioner if it means spending five years in purgatory after their term expires?Under the terms of the Accountability Act, once you leave the government payroll, you are banned from lobbying the government for a period of five years. In addition, you are prohibited from entering into an employment contract with an employer in the same industry one year prior to your last day as a public servant and for one year after you leave. These conditions put considerable restraints on an individual who is in mid-career in either telecom or broadcasting.However, there are clauses within the law that allow a person to get exemptions from some of the more onerous conditions. Regardless of this flexibility, it is an issue that many potential candidates must take into account as they contemplate an offer from the Governor-in-Council. If the political winds appear to be blowing an election into their laps, the Conservatives could just sit back and do nothing at all in terms of appointing new staff for the next year. Under the Telecommunications Act, a quorum of the commission for issues related to the Act is two; for uncontested items, it’s one. However, industry sources suggest it’s unlikely the government will sit back and let the number of commissioners slowly dwindle over time. After all, it is a perfect opportunity for the government to re-mould the commission in its image, to ensure that it makes telecom decisions more in line with the government’s thinking and that it can take on the challenges faced by the broadcasting sector. Only time will tell if the opportunity presented to the government results in a weaker commission beholden to its political masters or an independent, arm’s length quasi-judicial government agency that has been remodelled to face the challenges of this century.

Von Finckentstein appointment likely only first move from Conservatives

News | February 2, 2007

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us