Federal Court dismisses Terrestar’s appeal of CRTC spectrum revenue decision

Terrestar Solutions Inc.’s long-drawn-out fight against the CRTC’s decision that spectrum sublicensing revenues must be included in telecom companies’ financial contribution requirements has been dismissed with costs by the Federal Court of Appeal. The dispute began in 2022, when Terrestar tried to subtract spectrum sale and subordination earnings from its Canadian telecom service revenues in an annual report, which would have lowered the company’s contribution requirements to the National Contribution Fund. All service providers making over $10 million in annual Canadian telecom service revenues must contribute a percentage of that money to the fund, which supports CRTC initiatives including the Broadband Fund and video relay service. But the CRTC stepped in to block Terrestar’s deduction efforts, and the two bodies have been duking it out at various dispute stages for the last four years. The court appeal was filed in November 2024, but before that, Terrestar filed a Part 1 application with the CRTC, arguing the sale and subordination of spectrum does not fall under the Telecommunications Act’s definition of a “telecommunications service.” Spectrum subordination is when a company leases the rights to use part or all of its licensed spectrum to another wireless carrier. After the telco’s application was denied, on the basis that “any service that is incidental to the business of providing telecommunications services” also counts as a telecommunications service, Terrestar filed a review and vary application in 2023. The company also requested a stay of the decision until the regulator ruled on the review and vary application. Both were rejected in 2024. Terrestar’s appeal asked the court to strike down the CRTC decision and issue an order “declaring that the sale and subordination of electromagnetic spectrum are neither ‘telecommunications services’ nor services that are ‘incidental to the business of providing telecommunications services.’” In contrast to Terrestar’s arguments, Justice Peter G. Pamel found the commission did not err in its original decision, for which he said the regulator provided adequate reasoning. Terrestar had also argued the commission engaged in retroactive decision-making, as there were no previous CRTC decisions or documents that indicated spectrum sale and subordination were considered incidental to the business of providing telecom services. “I disagree,” wrote Pamel. “A retroactive law operates backward, affecting circumstances as they existed before the law was enacted—altering the legal landscape from what it was at that time.” “The review decision did not change the legal landscape. Rather, the Commission applied the existing legal standard in section 23 of the Act to TerreStar’s actual circumstances.” Terrestar failed to convince Pamel of any of its arguments, and he called the company’s assertion that the CRTC made a legal ruling regarding the interpretation of operating revenues a mischaracterization. The appeal was dismissed on July 28, with costs of $5,000 to be awarded to the CRTC. mcollins@thewirereport.ca

Federal Court dismisses Terrestar’s appeal of CRTC spectrum revenue decision

Court |
By Maria Collins
|July 30, 2026

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Federal Court dismisses Terrestar’s appeal of CRTC spectrum revenue decision

Court | By Maria Collins |July 30, 2026

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