Federal cabinet upholds CRTC decision on Telus-Bell contract dispute

The Conservative government has denied Telus Corp.’s petition to cabinet to review a controversial CRTC decision that weighed into a dispute between Telus and Bell Canada over a federal government contract. The CRTC decision, issued in January 2009, allowed Bell to continue to charge for network services on a government contract that Telus had won and taken over. Bell was granted authority to continue providing services because the transition wasn’t complete. Industry Canada spokeswoman Lauren Hébert said by email Friday that the federal cabinet let the CRTC decision stand last December after a careful review. “The Government found the decision is consistent with Canadian telecommunications policy objectives,” she wrote. “The CRTC is the appropriate agency to adjudicate contractual disputes for regulated telecommunications services.” On Dec. 9, 2010, the federal cabinet ruled that it would neither vary the decision, nor send it back to the commission for review. It has not been reported until now. In June 2007, Telus was awarded a $213-million network services contract with the Department of National Defence. Bell previously held the contract, which was due to expire Dec. 15, 2008. But the services transition from Bell to Telus did not meet the deadline, and as a result of the CRTC decision, Bell continued to charge for services. Telus said the network transition was effectively complete by the deadline, but Bell argued that the switch could not happen until the final circuit was cut. Telus brought the issue to the Federal Court of Appeal, which ruled in Bell’s favour last July. The CRTC also denied a request for review a month later. The unanimous Federal Court of Appeal decision noted that, as the government continued to pay Bell for services Telus could not provide by the deadline, Telus had to compensate Public Works and Government Services an undisclosed amount. The decision said the CRTC decision “may indirectly cause TELUS financial loss.” Telus had argued that the confusion over the contract could put a chill on the enterprise market’s interest in government services contracts. Ted Woodhead, Telus’ vice-president of telecom policy and regulatory affairs, said in a previous interview that the CRTC decision would have “profound impacts” on the government’s procurement of large, public sector contracts. “People need to look, in the long run, at what the impact of this is on the enterprise market. It puts a chill on competition in that market,” he said. Bell and Telus did not comment for this story. news@thewirereport.ca

Federal cabinet upholds CRTC decision on Telus-Bell contract dispute

News | June 10, 2011

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