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Industry committee delves into Rogers-Shaw deal as fate rests with Minister Champagne

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Rogers-Shaw deal

Key players and close watchers of Rogers Communications Inc.’s proposed takeover of Shaw Communications Inc. shared their views on the $26-billion deal at a House of Commons committee Wednesday as Industry Minister François-Philippe Champagne deliberates on its fate.

Critics of the deal, including academics and competitors, used the industry and technology meeting to argue that Champagne should either block the deal entirely or impose stricter conditions on it, while also raising concerns about the enforceability of the criteria he has already set out.

Proponents of the deal, including Rogers chief executive Tony Staffieri, emphasized the extensive and robust regulatory review that has found the deal meets the standards of Canada’s competition laws, including through weeks of hearings at the Competition Tribunal.

The tribunal’s decision was further upheld by the Federal Court of Appeal on Tuesday, a decision that the Competition Bureau said it was deeply disappointed about but accepts.

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The committee, which previously recommended against the deal, has no power over the decision that now rests with Minister Champagne, who said Wednesday he is still looking at the Court of Appeal’s ruling and other considerations and will make a decision in due course.

“I set a number of expectations that I would like to be met. And that’s what I’m going to be reflecting on, what are the expectations that I can demand that would ensure competition, that would ensure the fact that we have affordability,” he said.

At the committee, Staffieri looked to remind members of the numerous commitments Rogers has made already on investments, along with the benefits of selling Shaw’s Freedom Mobile to Quebecor Inc.’s Videotron Ltd. as part of the deal.

“These transactions have gone through a rigorous review, and will increase competition,” said Staffieri.

Edward Iacobucci, a professor at the University of Toronto’s Faculty of Law, agreed that the deal had seen a fair and rigorous review, while Jennifer Quaid, an associate professor at the University of Ottawa’s Faculty of Law, raised several concerns about how the review took place, as well as whether all of the necessary expertise was represented at the Competition Tribunal.

“I think it’s time to reconsider whether we have the right decision-making body,” she said.

Keldon Bester, co-founder of the Canadian Anti-Monopoly Project, used the forum in part to push for Champagne to add more conditions to his approval of the deal, including more aggressive pricing benchmarks, a timeline to reach them and consequences if they aren’t met.

He and others also emphasized the need to reconsider current competition laws, including through the public review set to launch soon.

Members of Parliament also raised concerns about the enforceability of the conditions of the deal, echoing concerns raised by the Competition Bureau that the numerous benefits Rogers is offering to Videotron are not reliable, with the two companies already feuding about service agreements in Quebec.

Committee members also raised concerns on how Rogers was able to choose who would be its wireless competitor in Western markets when it chose Videotron, with Globalive Inc. chairman chief Anthony Lacavera telling them that he bid close to a billion dollars higher than Videotron did for Freedom.

Staffieri maintained that Rogers chose Videotron as it best met the criteria set out for a viable fourth national carrier, including a proven track record, significant scale, and a credible path to a 5G network.

Rogers, which first proposed the deal in March 2021, is aiming to close it by the extended Jan. 31 deadline.

This report by The Canadian Press was first published Jan. 25, 2023.

Companies in this story: (TSX:RCI.B, TSK:SJR.B, TSX:QBR.B)

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Alberta to require 'free speech reporting' after uproar over controversial academic visit – CBC.ca

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Alberta to require ‘free speech reporting’ after uproar over controversial academic visit  CBC.ca

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Canada’s Black population faces varying job prospects despite equal education. Here’s why – Global News

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Canada’s Black population faces varying job prospects despite equal education. Here’s why  Global News

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Inflation in Canada: Finance ministers meet

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TORONTO – The two big spending pressures on the federal government right now are health care and the global transition to a clean economy, Deputy Prime Minister and Finance Minister Chrystia Freeland said Friday.
After hosting an in-person meeting with the provincial and territorial finance ministers, Freeland said U.S. President Joe Biden’s Inflation Reduction Act, which includes electric-vehicle incentives that favour manufacturers in Canada and Mexico as well as the U.S., has changed the playing field when it comes to the global competition for capital.

“I cannot emphasize too strongly how much I believe that we need to seize the moment and build the clean economy of the 21st century,” Freeland said during a news conference held at the University of Toronto’s Munk School of Global Affairs and Public Policy.

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“This is a huge economic opportunity.”

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Canada needs to invest in the transition in order to potentially have an outsized share in the economy of the future, she said, or it risks being left behind.

This year in particular will be an important year for attracting capital to Canada, she said, calling for the provinces and territories to chip in.

“This is a truly historic, once-in-a-generation economic moment and it will take a team Canada effort to seize it.”

At the same time, Freeland spoke of the need for fiscal restraint amid economic uncertainty.

“We know that one of the most important things the federal government can do to help Canadians today is to be mindful of our responsibility not to pour fuel on the fire of inflation,” she said.

Freeland said these two major spending pressures, which were among the topics prioritized at Friday’s meeting, come at a time of a global economic slowdown which poses restraint on government spending.

Prime Minister Justin Trudeau is set to meet with the premiers Feb. 7 to discuss a long-awaited deal on health-care spending. The provinces have been asking for increases to the health transfer to the tune of billions of dollars.

Freeland said it’s clear that the federal government needs to invest in health care and reiterated the government’s commitment to doing so but would not say whether she thinks the amount the provinces are asking for in increased health transfers is feasible.

“It’s time to see the numbers,” Quebec Finance Minister Eric Girard said Friday afternoon, in anticipation of the Feb. 7 meeting.

The meeting of the finance ministers comes at a tense time for many Canadian consumers, with inflation still running hot and interest rates much higher than they were a year ago.

The ministers also spoke with Bank of Canada governor Tiff Macklem Friday and discussed the economic outlook for Canada and the world, said Freeland.

“We’re very aware of the uncertainty in the global economy right now,” said Freeland. “Inflation is high and interest rates are high.”

“Things are tough for a lot of Canadians and a lot of Canadian families today and at the federal level, this is a time of real fiscal constraint.”

The Bank of Canada raised its key interest rate again last week, bringing it to 4.5 per cent, but signalled it’s taking a pause to let the impact of its aggressive hiking cycle sink in.

The economy is showing signs of slowing, but inflation was still high at 6.3 per cent in December, with food prices in particular remaining elevated year over year.

Interest rates have put a damper on the housing market, sending prices and sales downward for months on end even as the cost of renting went up in 2022.

Meanwhile, the labour market has remained strong, with the unemployment rate nearing record lows in December at five per cent.

This report by The Canadian Press was first published Feb. 3, 2023.

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