CRTC kills the Bell-Astral deal, but Bell is going over daddy’s head to mommy – UPDATED

Not in the cards. For now.

Good news for a Friday! Well, unless you’re a fan of media conglomeration I guess. The CRTC has flat out rejected Bell’s request for approval of their planned buyout of Astral. Not hemming and hawing like they usually do, but just stone-cold giving Bell the finger. But Bell won’t take this decision lying down, they’ve got plans! Evil, nefarious plans!

Let’s take a step back here for those who are wondering what’s up. My regular readers (hi mom and Steve!) will remember that last month I wrote about the hearings the CRTC was holding in Montreal into Bell’s proposal to buy Astral Media for $3.4 billion. Bell said it would be good for the media landscape in this country. Just about everyone else disagreed.

And the CRTC, so often seen as pro-everyone but consumers, actually disagreed too! Yesterday they released Broadcasting Decision 2012-574 (do not try to read it, I implore you) which laid the smack down on Bell and put the kibosh on the deal. The overall gist of why is that the deal just would not be good for Canadians. Huh? Since when does the CRTC do that? Let’s go to the blockquotes:

The Commission considers that the concerns related to competition, ownership concentration in television and radio, vertical integration and the exercise of market power are very substantial and fatal to the application.

I am STUNNED I tell you. The CRTC actually doing its job and protecting competition? But wait, there’s more:

The Commission finds that BCE has not discharged its burden and demonstrated that, on balance, this transaction is in the public interest. The benefits proposed would advantage BCE and its services, but the Commission is not persuaded that the transaction would provide significant and unequivocal benefits to the Canadian broadcasting system and to Canadians sufficient to outweigh the concerns

Public interest? Canadians? Who are you, and what have you done with my CRTC?

So what has this got to do with internet law? Well, not much anymore! Had the deal gone through, the media landscape including the internet would have been fundamentally altered. Now, Canadian internet will just be the same crappy expensive service you’ve always had. Also, Bell’s promise to start a “Netflix-like service” in Canada is now down the (inter-)tubes. But it probably would have sucked anyway, so no great loss.

HOLD THE PHONE!

If you think this story is over, you are sorely mistaken. Or you’ve never worked in the legal / regulatory department of a large Canadian media company. Every decision can be appealed. Every decision must be appealed. There’s lawyers’ fees to be made!

*** Please see correction below*** Now it’s time to get lawyer-y. Sorry. The CRTC is governed by the Telecommunications Act. According to that Act, decisions of the CRTC can be reviewed or modified in several ways. First, the CRTC can review and modify its own decisions. Huh? Let’s just skip that one. Next, section 64 of the Act says that decisions can be appealed to the Federal Court of Appeal. The problem with that one is that only decisions that deal with “questions of law or jurisdiction” can be appealed. Since this decision is one that’s really of general policy, I am not sure it would qualify. Though Bell has 30 days to file an appeal there, so we’ll see.

But there is another way. Section 12 of the Act says:

Within one year after a decision by the Commission, the Governor in Council may, on petition in writing presented to the Governor in Council within ninety days after the decision, or on the Governor in Council’s own motion, by order, vary or rescind the decision or refer it back to the Commission for reconsideration of all or a portion of it.

Booyah! We have a winner! That’s what Bell is going to do. Because they are “shocked” at the decision. Now, I am sure many of you are asking who or what the fuck is the “Governor in Council”? Good question! It’s one of those terms only known to politicos and lawyers. It essentially means the Cabinet, all the ministers of stuff. Technically, it really is the Governor General acting on the advice of the Federal cabinet. But that’s just confusing. Suffice it to say, it’s a group of people who can throw this decision out the window, and who listen to Stephen Harper.

It ain’t over ’til it’s over.

UPDATE – Well, well, well. Like, ten minutes after I clicked publish, the news broke that Ottawa will NOT intervene in the decision. Sure, make me look bad Ottawa. Here’s what Heritage Minister James Moore’s spokesperson said:

“CRTC decisions are made independent of the Government of Canada,” Mr. Gariepy said.

“Cabinet has no legal ability to overturn this decision.”

WRONG buddy. Read my blog post! I just showed you where the legal ability is. Hmmm. Anyway, Bell still has the Federal Court of Appeal. You can absolutely expect they’ll file an appeal now.

*** UPDATE #2 / CORRECTION – As an astute reader has pointed out, this decision was made under the Broadcasting act, not the Telecommunications Act. The CRTC has functions and makes decisions under both Acts. As a result, my analysis of the appeal process is not accurate. While the standard of review to the Federal Court of Appeal is the same for decisions under both acts, Governor in Council can only order the CRTC to do something based on “general application on broad policy matters” (section 7 of the Broadcasting Act). That is the path Bell wanted to take (see e.g. this story), and it may have had merit, though of course that point is moot now.

I sincerely regret my error and thank Will for the correction. I apologise to my readers and to anyone reading this now and seeing all the strikeout.