Reply Comments on Comments Received on Arbitration Rules ... · submissions and decisions regarding...
Transcript of Reply Comments on Comments Received on Arbitration Rules ... · submissions and decisions regarding...
For/Teresa Griffin-Muir
Vice President, Regulatory Affairs Vice-présidente des Affaires réglementaires
MTS Allstream Inc.
18 July 2008 by Email Mr. Peter Hill Director – Spectrum Management Operations Radiocommunication and Broadcasting Regulatory Branch Industry Canada 300 Slater Street Ottawa, ON K1A 0C8 Dear Mr. Hill: Subject: Consultation on Draft Arbitration Rules for Mandated Roaming/Antenna Tower
Sharing Disputes
MTS Allstream Inc. (MTS Allstream) provides the attached reply comments on the Department's
Draft Arbitration Rules for mandated roaming and antenna tower and site sharing disputes.
Yours truly,
Attachments
Winnipeg: PO Box 6666, MP19C, 333 Main Street, Winnipeg, MB R3C 3V6 Tel: (613) 688-8789 Fax: (613) 688-8303 email: [email protected] Ottawa: 14th Floor, 45 O'Connor Street, Ottawa, ON K1P 1A4 Tel: (613) 688-8789 Fax: (613) 688-8303 email: [email protected]
Mr. Peter Hill 18 July 2008
Consultation on Draft Arbitration Rules
For Mandated Roaming and Antenna Tower
And Site Sharing Disputes
Reply Comments of
18 July 2008
Industry Canada – Arbitration Rules
Mr. Peter Hill 18 July 2008
Table of Contents
I. INTRODUCTION ...................................................................................................1 II. "TECHNICAL FEASIBILITY" ISSUES .................................................................4 III. ARBITRATION RULES.........................................................................................5
A) Guidance to the Arbitral Tribunal (Section 2.3) ................................................5
B) Interpretation Issues (Article 1) .........................................................................7
C) Final Offer Arbitration Model..............................................................................8
D) Composition of Arbitral Panel and Appointing Committee...........................11
F) Confidentiality of Arbitral Proceedings and Awards .....................................14
G) Miscellaneous Additional Steps and Timelines..............................................15
H) Rights of Appeal – Finality of Arbitral Decisions ...........................................17 IV. CONCLUSION ....................................................................................................19
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I. INTRODUCTION
1. MTS Allstream Inc. (MTS Allstream) has reviewed the comments of interested parties
dated 23 June 2008 and as posted as of this date to the Department's website1 on the
Department's draft arbitration rules and procedures for mandated roaming and antenna
and site sharing disputes (Draft Arbitration Rules) and provides herein its reply
comments.
2. MTS Allstream's participation in this consultation process in relation to the Draft
Arbitration Rules, as well as in the proceeding that led to Conditions of Licence for
Mandatory Roaming and Antenna Tower and Site Sharing and to Prohibit Exclusive Site
Arrangements2 (Conditions of Licence), is focused on facilitating the Government's
objective of increasing new competitive entry into Canadian mobile wireless telephony
markets. MTS Allstream fundamentally supports the steps, timelines and proposed
finality of the Draft Arbitration Rules. Its comments and proposals in relation to the Draft
Arbitration Rules are intended to enhance rather than to hinder the just, speedy and
cost-effective resolution of disputes that may arise in relation to mandated roaming or
sharing of an antenna tower or other site (collectively, roaming/site sharing)
arrangements.
3. Parties other than the incumbents Bell Mobility, Rogers and TELUS (the Big 3) and
SaskTel also generally endorse the Final Offer Arbitration model, the procedural steps,
timelines and finality of the arbitral process that is described in the Draft Arbitration
Rules. These new entrant parties have also unanimously endorsed the fact that in order
for the Parties to the arbitration and for the Arbitral Tribunal to make informed
submissions and decisions regarding "commercially comparable rates, terms and
conditions", Parties should be required to disclose at the outset of an arbitration the
rates, terms and conditions of roaming/site sharing agreements or arrangements, as the
case may be, that are currently in place.
1 See http://www.ic.gc.ca/epic/site/smt-gst.nsf/en/sf08987e.html. 2 Published as Canada Gazette Notice No. DGRB-002-08 dated February 29, 2008, Canada Gazette, Part I,
Vol. 142, No. 10 — March 8, 2008 (Gazette Notice DGRB-002-08).
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4. On the other hand, the Big 3 incumbents and SaskTel argue that they would be
disadvantaged by the proposed timelines, the binding and final nature of arbitration, and
the need for confidential treatment of roaming/site sharing agreements and
arrangements already in place. In addition, the Big 3 and SaskTel argue that Final Offer
Arbitration is unfair and, more generally, that they would be disadvantaged by the
proposed arbitral process.
5. Having reviewed the comments of the parties and in particular those of the Big 3 and
SaskTel, MTS Allstream submits that the economic interest of the latter to delay the
effective implementation of roaming/site sharing with any competitor, and hence market
entry, is undeniable, as is the need, therefore, to foresee and counter this interest.
Accordingly, MTS Allstream's reply comments will focus on the following elements of the
Draft Arbitration Rules:
(a) All parties have acknowledged the Department's guidance that questions
concerning the technical feasibility of a roaming/site sharing request should
remain within the purview of the Department. It would, therefore, be desirable for
the Department to clarify this restriction on the Arbitral Tribunal's jurisdiction in
accordance with MTS Allstream's 23 June 2008 comments in this consultation
process;
(b) Both incumbents and new entrants voiced many conflicting concerns regarding
the lack of clarity in the wording and purpose of section 2.3 of the Draft
Arbitration Rules. There is no need to repeat, using different words, the clear
substantive principles that have already been enunciated by the Government in
its policy documents. Consistent with MTS Allstream's 23 June 2008 comments,
section 2.3 should therefore be eliminated;
(c) The provisions in the Draft Arbitration Rules with respect to timelines are
generally appropriate in their current form;
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(d) The arbitration rules should expressly provide for the disclosure of existing
agreements or arrangements in the arbitration process;
(e) Given the Big 3's clear and virtually stated incentive to delay as much as possible
the effective implementation of the Minister's policy decision to mandate
roaming/site sharing, MTS Allstream reiterates that the Final Offer Arbitration
model should be front-loaded such that parties have heightened incentives to
table their most reasonable offers at the beginning of the arbitration process;
(f) In the alternative, the presentation of Terms Sheets in the arbitral process could
be staggered, such that the Responding Licensee presents its Term Sheet first,
thereby allowing the Requesting Operator to base its responding Term Sheet on
the form and structure of the Responding Licensee's Term Sheet;
(g) Both incumbents and new entrants have expressed concerns relating to the
possibility of incongruent agreement structures and terms and conditions. Some
parties have suggested that this could be resolved through the appointment of
experts by the Parties to an arbitration or by the Arbitral Tribunal itself.
MTS Allstream submits that the appointment of experts should form the
exception to the rule, as it would add complexity and delay to the process.
Incongruent agreement structures and terms and conditions can largely be
avoided by:
i. Disclosure of existing agreements and arrangements; and
ii. As submitted by MTS Allstream in its 23 June 2008 comments, a rule that
the Term Sheets of the Parties to an arbitration should be based on a
template roaming/site sharing agreement; and
(h) The provisions in the Draft Arbitration Rules with respect to rights of appeal are
appropriate; however, it should also be made clear that a Responding Licensee
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may not refuse to grant roaming/site sharing in accordance with an arbitral award
pending any appeal or review.
6. Any failure on the part of MTS Allstream to respond to each and every one of the parties'
comments in this consultation should not be construed as agreement on MTS
Allstream's part with such comment or position where such agreement would be contrary
to the interests of MTS Allstream.
7. For the convenience of the Department and of the parties, a further revised blacklined
copy of Draft Arbitration Rules reflecting MTS Allstream's specific comments is attached
as Appendix A to this submission.
8. In addition, MTS Allstream refers the Department to Appendix B of MTS Allstream's
23 June 2008 comments, which proposes a roaming agreement to be used as a
standard or template roaming agreement. The adoption of a standard or template
roaming agreement sanctioned by Industry Canada would assist parties during the
negotiation process and ensure that the number of issues brought before an Arbitral
Tribunal for resolution are minimized. MTS Allstream further submits that, should the
Department adopt a template roaming agreement, it should also consider adopting a
template site sharing agreement.
II. "TECHNICAL FEASIBILITY" ISSUES
9. All parties to this consultation process have acknowledged the Department's guidance
that questions concerning the technical feasibility of a roaming/site sharing should
remain within the purview of the Department.
10. To avoid appeal, it would be desirable for the Department to more clearly delineate
the Department's jurisdiction over technical issues and the Arbitral Tribunal's jurisdiction
over all other issues related to a roaming/site sharing arrangement.
11. For purposes of the Draft Arbitration Rules, it should be clear that the condition of
licence relating to the Department's oversight of questions of technical feasibility applies
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not only in situations where the Responding Licensee intends to rely on technical
reasons or grounds to justify outright denial of a Proposal, but also where the
Responding Licensee intends to rely in whole or in part on technical reasons to justify a
deviation from commercial rates. For greater clarity, the Responding Licensee's initial
30-day response must detail any technical reasons that it intends to rely upon and the
expected implication of these. It should then be open to the Requesting Operator to
decide whether, in the circumstances, the technical issues raised by the Responding
Licensee are legitimate and can be appropriately be dealt with in the ensuing
negotiations or, if necessary, the commercial arbitration, or whether the Requesting
Operator will ask "Industry Canada to review the reasons provided by the Licensee."
III. ARBITRATION RULES
A) Guidance to the Arbitral Tribunal (Section 2.3)
12. MTS Allstream notes that section 2.3 of the Draft Arbitration Rules was subject to
criticism and concern from all quarters. Aside from the non-mandatory nature of the
language in the first sentence of section 2.3, particularly problematic was the lack of
clarity in the use of the words "market information" in relation to international markets on
the one hand and "market forces" in relation to the Canadian market on the other.
13. The parties' often contradictory submissions regarding the areas of uncertainty and
proposed solutions underline the danger of a clause like section 2.3, which attempts to
put into its own words the policies already set out in the Policy Framework for the
Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in
the 2 GHz Range3 (AWS Policy Framework), the Licensing Framework for the Auction
for Spectrum Licences for Advanced Wireless Services and other Spectrum in the 2 GHz
Range4 (AWS Licensing Framework) or in the Conditions of Licence themselves. The
relevant principles are already laid out in the Government's policy documents. The
arbitration framework and the Draft Arbitration Rules should obviously be consistent with
3 Canada Gazette Notice No. DGTP-007-07 dated November 29, 2007, Canada Gazette, Part I, Vol. 141, No. 49
— December 8, 2007. 4 Canada Gazette Notice No. DGRB-011-07 dated December 14, 2007, Canada Gazette, Part I, Vol. 141, No. 51
— December 22, 2007.
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the Government's overall policy framework, as enunciated in the AWS Policy
Framework, the AWS Licensing Framework and the Conditions of Licence.
14. Section 2.3, to the extent it deviates in any way from the policies already set out in the
AWS Policy Framework, the AWS Licensing Framework or in the revised Conditions of
Licence has the potential of confusing the issues and giving parties the opportunity to
argue for new or different policy considerations.
15. Indeed, Bell Mobility and Rogers go so far as to suggest that a new section be added to
the arbitration rules to expressly confirm the precedence of the Conditions of Licence
and the Responses to Questions for Clarification on the AWS Policy and Licensing
Frameworks over the arbitration rules.5 The AWS Policy Framework and the AWS
Licensing Framework must be included in the pantheon of interpretational tools. If an
order of precedence is to be ascribed, one should assign priority to the documents that
established the general statements of policy, namely the AWS Policy Framework and
the AWS Licensing Framework. Listing only the Conditions of Licence and the
Responses to Questions for Clarification on the AWS Policy and Licensing Frameworks,
as suggested by Bell Mobility and Rogers, would be incomplete insofar as a listing of the
relevant policy documents is concerned and should therefore be avoided as it would
introduce more questions and uncertainty rather than dispelling the same.
16. In MTS Allstream's view, the parties to arbitration would be entitled to make submissions
based on the policy documents and an Arbitral Tribunal should be guided by the policy
objectives of the Government. It would only create uncertainty and confusion to attempt
to impose an order or precedence or priority as between each the policy documents and
Conditions of Licence.
17. Therefore, MTS Allstream submits that it is unnecessary and inappropriate to include
section 2.3 in the arbitration rules.
5 See Bell Mobility, 23 June 2008 comments, paragraph 16.
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B) Interpretation Issues (Article 1)
18. With respect to Bell Mobility's proposal that the definitions of the terms "roaming",
"licensee", "roaming agreement" and "site sharing agreement" in the arbitration rules be
made "consistent" with those in the Conditions of Licence and that a new definition for
"ancillary equipment and services" be added,6 the problem is that there are no
definitions of these terms per se in the Conditions of Licence or in the Questions for
Clarification on the AWS Policy and Licensing Framework documents.7 In its definition
for "Licensee", Bell Mobility proposes to exclude a provisional licence winner who is a
high bidder in a spectrum auction.8 The intent behind this amendment appears to be to
preclude arbitration up until such time as such a provisional licence winner is actually
licensed. This would clearly be at odds with the AWS Policy Framework, the AWS
Licensing Framework and the Conditions of Licence. For example, the Conditions of
Licence clearly state that Responding Licensees must respond to, negotiate in good
faith, share sites and provide roaming to any radiocommunication carriers or cellular,
PCS or AWS licensees or any "party who is a provisional licence winner following the
Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in
the 2 GHz Range."9
19. The definition proposed for "Ancillary Equipment and Services", does not include a
single concrete example of exactly what Bell Mobility means to exclude from this
definition by way of ancillary "services." Similarly, Bell Mobility has failed to substantiate
what is typical or atypical of site sharing agreements in North America by way of
cabinets, shelters, electrical power, and generators.10
6 See Bell Mobility, 23 June 2008, paragraph 15 and paragraphs 39 to 44. TELUS also makes some modifications
to the Article 1 of the Draft Arbitration Rules, without explaining the rationale behind these modifications. 7 There are no definitions of the terms that Bell Mobility seeks to improve. Rather, to fully understand these terms,
the AWS Policy Framework, the Licensing Framework and the Conditions of Licence must be read as a whole. 8 Bell Mobility removes from the definition of "Licensee" a provisional licence winner who is a high bidder in a
completed spectrum auction. See Bell Mobility, 23 June 2008 comments, Appendix (Blacklined Version), page 2 of 14.
9 See Conditions of Licence for Mandatory Antenna Tower and Site Sharing and to Prohibit Exclusive Site Arrangements, condition 2 and Conditions of Licence for Mandatory Roaming, condition 1d.
10 See Bell Mobility, 23 June 2008 comments, paragraphs 41 to 43.
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20. The fact is that once relevant site sharing agreements and arrangements are disclosed
and produced by Responding Licensees in accordance with the arbitration rules (as
proposed by MTS Allstream and other new entrant parties), it will be clear to the Parties
and to the Arbitral Tribunal exactly what ancillary equipment and services are typically
associated with and provided by Responding Licensees to their counterparts. To restrict
the definition of ancillary equipment and services without knowing what is typical in
Bell Mobility's site/sharing arrangements or those of other Licensees would indeed give
rise to unwarranted debates that could be avoided once proper disclosure of relevant
agreements and arrangements is made.
C) Final Offer Arbitration Model
21. As presaged by their contributions to the consultation session that took place on
23 May 2008, the Big 3 (including TELUS), as well as SaskTel, fundamentally objected
to the Final Offer Arbitration model proposed by MTS Allstream and TELUS in the
DGRB-010-07 proceeding.
22. That the Big 3 are united in their opposition to the Final Offer Arbitration model is hardly
surprising. In the proceeding that led up to Gazette Notice DGRB-002-08, their
arguments in relation to the implementation of mandated roaming/sites sharing were
devoted to creating pre-conditions or allegedly "technical" impediments to roaming/site
sharing for the sole purpose of creating barriers to the implementation of roaming/site
sharing as mandated by the Minister. Left to the operation of market forces alone, the
economic self-interest of the Big 3 (the parties that new entrants will necessarily have to
negotiate with), dictates that they deny, delay or hinder any competitive entry to the
greatest extent possible. It is, therefore, appropriate to build into the Department's
arbitration framework added incentives for the incumbent licensees to negotiate in good
faith. Final offer arbitration builds in these incentives as there is little to be gained and
more to lose from delaying the presentation of a best offer.
23. Final Offer Arbitration is certainly appropriate as the means of resolving issues
concerning roaming/site sharing, since the nature and type of roaming/site sharing is
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mandated and defined by Industry Canada and any technical issues are to be carved out
and dealt with separately and on a preliminary basis by Industry Canada. As a result,
the range of commercial issues that should arise in relation to the negotiation of a
commercially reasonable roaming/site sharing agreement should be relatively limited
and therefore conducive to Final Offer Arbitration.
24. Final offer arbitration is an accepted model for arbitration that has many precedents in a
variety of contexts. Indeed, Final Offer Arbitration is the preferable or most appropriate
model to adopt where, as in the case of mandatory roaming/site sharing, the ultimate
objective is to conclude an agreement. In this regard, MTS Allstream notes that
Videotron's reference to the Canada Transportation Act's provisions for Final Offer
Arbitration is relevant. The scheme of Part IV of that Act is intended to provide an
arbitral framework pursuant to which a shipper and carrier may resolve issues
surrounding a shipper's dissatisfaction with the rate or rates charged or proposed to be
charged by a carrier for the movement of goods, with the ultimate objective of altering
the carrier's tariffs or to form an agreement between the carrier and the shipper.
25. Final Offer Arbitration is also appropriate where, as in the case of shippers and carriers,
one side in the negotiation has more market power than the other. The Government
instituted mandated roaming/site sharing precisely because market forces, left to
operate on their own, would not yield access at commercially reasonable rates to the
existing infrastructure of the Big 3.
26. Furthermore, Final Offer Arbitration will provide the added and necessary incentives to
the Big 3 to negotiate in good faith and to present their best, most reasonable offers
during the negotiation period or early on in the arbitration process. Clearly, Final Offer
Arbitration presents the least likelihood of delay, since the parties will be motivated to
present reasonable terms and conditions at the outset since the arbitral panel is required
to select the most "reasonable" offer of the two offers. In this regard, TELUS agrees that
presenting final terms well into the arbitration process is not an "effective inducement to
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reasonable negotiation" and "that final offers should crystallize before the arbitration
proceedings commence."11
27. To make the Final Offer Arbitration model even more effective, in its 23 June 2008
comments, MTS Allstream made two proposals:
(a) MTS Allstream proposed that parties should be required to put forward their
"final" Term Sheet once, at the outset of the arbitration process, rather than at
the close of the oral hearing or with the filing of final written submissions; and
(b) MTS Allstream proposed that the Department should adopt a template roaming
agreement. This would further reduce the number of issues to be resolved
between a Responding Licensee and a Requesting Operator.
28. Having read the 23 June 2008 comments of other interested parties, MTS Allstream
notes that the foregoing improvements foresaw and address any concerns regarding the
difficulty of dealing with incongruent Term Sheets12 while at the same time maintaining
the incentives of the Big 3 to negotiate in good faith. To assist in this regard, the
Department should develop and adopt a template site sharing agreement. The
Department should also give due consideration to developing two or more templates for
Proposals to access a large number of sites as opposed to one or a small number of
additional sites.
29. As an alternative and to respond to the concerns raised by the Big 3 regarding
incongruent Term Sheets, the arbitration procedures could also be amended as follows:
(a) Within 3 Business Days of the appointment of the Arbitral Tribunal, the
Responding Licensee within the meaning of the Conditions of Licence shall
submit a Term Sheet for Roaming or Site Sharing, as the case may be;
11 TELUS, 23 June 2008 comments, page 4. 12 See Quebecor Media Inc. (QMI), 23 June 2008 comments, page 6; and Rogers, 23 June 2008 comments,
page 1. QMI suggests that the parties and Arbitral Tribunal deal with the issue of incongruent term sheets by agreeing on the elements of the terms sheets at the First Procedural Hearing.
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(b) Within 7 Business Days of the appointment of the Arbitral Tribunal, the
Requesting Operation will submit a responding Term Sheet for Roaming or Site
Sharing, as the case may be.
30. Adopting a template agreement or allowing for the staggered submission of Term Sheets
such that the basic structure of agreement proposed by the Responding Licensee will
form the basis of the eventual agreement would reduce the potential for incongruent
Term Sheets or agreement structures. This would facilitate negotiation and failing that,
the arbitral process, since it would better enable the Parties to join issues, rather than
arguing at cross-purposes regarding widely divergent agreement structures.
31. Adopting either of MTS Allstream's proposals would have the salutary effect of greatly
reducing the potential for applications for judicial review of arbitral awards, simply by
virtue of the fact that the Department, through a Final Offer Arbitration that is based on a
template agreement or that is based on the prevailing form of agreement in use in the
Responding Licensee's territory, will have greatly reduced the number of differences
between the Parties through the use of a commonly understood agreement structure.
D) Composition of Arbitral Panel and Appointing Committee
32. Several parties have suggested that members of the Appointment Committee should not
be eligible to serve as members of an Arbitral Tribunal.
33. By way of reply, MTS Allstream submits that where the Parties agree, there can be no
prejudice from the selection of a member of an Appointing Committee as an arbitrator.
However, MTS Allstream concurs that absent such consent, members of the Appointing
Committee should not be eligible to be named as an arbitrator by way of any method
contemplated by the Rules (other than the agreement of the Parties). Consequential
amendments to section 3.3 of the Draft Arbitration Rules are reflected in Appendix A of
this reply.
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34. The Big 3 and SaskTel have also recommended that the Arbitral Tribunal should by
default be composed of three arbitrators rather than a single arbitrator or propose that
three-person tribunals should be the rule except where Short Form Procedures apply (in
the case of the Big 3 only for disputes concerning a single antenna tower). Under
MTS Allstream's proposals in this consultation process, only a single, long-form
procedure should apply, by default, adding further certainty to the process. A
three-member Arbitral Tribunal will be more costly to the Parties (a factor that is likely to
have a proportionately greater impact on a new entrant rather than one of the Big 3).
The Big 3 have offered no real, reasoned justification for a right to a three-member
Arbitral Tribunal. Defaulting to a three-person Arbitral Tribunal gives rise to concerns
regarding the availability of arbitrators, particularly in the initial stages of the
implementation of the Conditions of Licence. Given the streamlined nature of the issues
and processes, a three-person tribunal should form the exception and not the rule.
E) Disclosure and Production of Relevant Roaming/Site Sharing Agreements
35. MTS Allstream has recommended that the Draft Arbitration Rules explicitly provide for
the production of a copy or details of all current roaming/site sharing agreements and
arrangements, as the case may be.13 It is noteworthy that all new entrant parties
participating in this consultation voiced their unanimous support for this important
principle.14
36. In contrast, the Big 3 seek to withhold any and all disclosure from Requesting Operators
and in some cases the Arbitral Tribunal itself on grounds that disclosure would
purportedly subvert market forces or the foundational principles embodied in the
Conditions of Licence.15
13 See section 9.2 of MTS Allstream's revised arbitration rules, attached at Appendix A of these reply comments.
See also subsection 9.1(b) of the revised arbitration rules which makes a minor consequential amendment to the rules pertaining to the procedural hearing, which acknowledges the documentary disclosure requirements of section 9.2.
14 See Eastlink, 23 June 2008 comments, paragraphs 10(a) and (b); Globalive, 23 June 2008 comments, pages 3 and 4; LSA Inc., 23 June 2008 comments, page 3; and QMI, 23 June 2008 comments, page 9.
15 See Bell Mobility, 23 June 2008 comments, paragraphs 27 and 28.
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37. Full transparency of the rates, terms and conditions of existing roaming/site sharing
agreements is consistent with the reality that the Canadian mobile wireless market is not
as competitive as it should be and that the operation of so called "market forces" alone
would provide no incentive whatsoever to incumbent licensees to enter into roaming/site
sharing arrangements with new entrants. Nor do transparency principles subvert market
forces.16 Rather, transparency removes the impediment of imperfect information in
achieving the Government's objective of granting roaming/site sharing to new entrants at
rates that are reasonably comparable to rates upon which similar services are being
provided in situations where the parties have relatively equal bargaining power.
38. Given the policy objectives of the Government in mandating roaming/site sharing, the
Minister should institute processes which favour the public interest in disclosure over the
purely private interest in withholding the most direct, relevant information regarding the
central issue to be determined in the arbitration.
39. It is ironic that the Big 3, who profess to be genuinely concerned about the fairness of
the process, should be so opposed to transparency principles in relation to the rates,
terms and conditions of roaming/site sharing arrangements already in place. Openness
and transparency are keystone principles of the doctrine of fairness. The Big 3's
selective reliance on fairness principles points to the self-serving nature of their
submissions in this consultation process.
40. Transparency and openness in relation to the rates, terms and conditions of roaming/site
sharing arrangements already in place is necessary in order to be consistent with the
AWS Policy Framework, the AWS Licensing Framework and Conditions of Licence. As
conceded by Bell Mobility, the central issue to be determined in arbitration pursuant to
the arbitration rules is whether the rates, terms and conditions proposed by a
Responding Licensee are reasonably comparable to rates currently charged to others for
similar services. Given that this is the central issue of the negotiation and the potential
arbitral proceeding, it is difficult if not impossible to imagine how the Requesting
Operator and Arbitral Tribunal could make informed submissions or decisions on the
16 Bell Mobility's logic in this regard is contorted – see Bell Mobility, 23 June 2008 comments, paragraph 27.
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criteria of whether the rates, terms and conditions proposed by a Responding Licensee
are "reasonably comparable to rates currently charged"17 without disclosure of
concluded roaming/site sharing arrangements.
41. Nor would it be sufficient, as argued by Bell Mobility, for Responding Licensees to
disclose to the Arbitral Tribunal and/or expert the rates currently charged to others for
similar services but to withhold such information from the Requesting Operator. The
rates, terms and conditions of roaming/site sharing arrangements pursuant to which the
Responding Licensee currently provides similar services to others are directly relevant to
the criterion of rates, terms and conditions that are negotiated between reasonably
comparable competitors.
42. Withholding disclosure is likely to increase the cost and length of the proceedings. As
well, the Requesting Operator will have to establish by way of cross-examination much
of the factual or evidentiary basis necessary in order to gauge the reasonableness of the
Responding Licensee's submissions. Furthermore, leaving disclosure to a later, ad hoc
stage of the proceeding would delay the timelines. Given the central issue to be
determined in arbitration, the Department should not leave to an ad hoc process the
requirement to disclose information that is so clearly relevant and necessary to the final
arbitral award.
F) Confidentiality of Arbitral Proceedings and Awards
43. MTS Allstream concurs with the view that the arbitration process itself is a bilateral
process and therefore, no other parties would be permitted to intervene in the arbitration
proceeding. However, MTS Allstream submits that awards made by Arbitral Tribunals
should be published, as should the Term Sheet adopted by the Arbitral Tribunal in an
award.
17 See Conditions of LIcence 8.4.b) and 9.4.b). For other purposes, Bell Mobility concedes that achieving an
agreement that incorporates "commercially reasonable rates that are comparable to those extant in the market for a comparable service or facility" … "is, and must be, the only standard that the Arbitral Tribunals strive for in making their final awards"; see Bell Mobility, 23 June 2008 comments, paragraph 7.
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44. Bell Mobility argued that the language at section 10.2(e) that excludes "sensitive
commercial information" from decision summaries or extracts that would be published
under the Department's Draft Arbitration Rules is unclear and would likely lead to
endless debates regarding what is sensitive or not. Consistent with MTS Allstream's
other recommendations herein (such as the adoption of a template agreement and the
transparency principles outlined above), MTS Allstream submits that it would make little
sense to withhold disclosure of the rates, terms and conditions upon which an Arbitral
Tribunal has made its award. Furthermore, the Government's purpose of achieving
roaming/site sharing on commercial terms as quickly and as cost-effectively as possible
would be furthered if the Term Sheet upon which the arbitrated agreement was based
were to be published.18
45. MTS Allstream has made certain additional consequential amendments to Article 10 and
in particular section 10.2 and added a new section 10.4. These are reflected in the
blacklined version of the arbitration rules that are attached at Appendix A to these reply
comments.
G) Miscellaneous Additional Steps and Timelines
46. MTS Allstream strongly endorses the fact that throughout the Draft Arbitration Rules, the
Department has clearly set out explicit timelines for the performance or satisfaction of
each possible step in the arbitration process.
47. MTS Allstream also submits that default timelines that are expressly provided for in the
Draft Arbitration Rules are generally speaking, reasonable. In this regard,
MTS Allstream would have no objection to Quebecor Media Inc.'s suggestion that the
arbitration rules make it more explicit (through an amendment of section 2.5 of the Draft
Arbitration Rules) that the timelines set out in the rules should not be deviated from by
an Arbitral Tribunal except for "good reason and after consultation with the Parties."
18 MTS Allstream notes that Globalive draws an analogy between the public interest that drives the Canadian
Radio-television and Telecommunications Commission's requirement that the terms of building access arrangements be disclosed and the public interest that drove the Minister to mandate roaming and site sharing. Globalive also requests that a similar public database in which "all antenna tower site access agreements are posted". Transparency of arbitral awards and approved Term Sheets is an obvious precondition to the creation of such a public resource.
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Mr. Peter Hill 18 July 2008 Page 16 of 19
48. In contrast, the Big 3 and SaskTel seek to impose panoply of additional steps and built-
in delays into the timelines, as summarized in the table below, along with
MTS Allstream's response to these proposals. MTS Allstream notes that many of the
concerns expressed by the Big 3 regarding uncertainty would be readily addressed
through the adoption of a template agreement or, in the alternative, a process that
requires the Responding Licensee to provide the form of agreement that it is prepared to
enter into, thereby reducing the issues of contention between the Parties.
49. Bell Mobility, in particular, also comments on the need for impartial arbitrators and
experts. MTS Allstream observes that the impartiality of the decision-maker goes
without saying and that the provisions contained in the Draft Arbitration Rules already
allow parties the remedy of judicial review for biased decision-making.
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Mr. Peter Hill 18 July 2008 Page 17 of 19
Issue Draft Arbitration Rules
Proposed Big 3 Modification
MTS Allstream Position
Response to Notice of Arbitration
N/A 719 days of receipt of Notice of Arbitration
If allowed, should take place within 3 days of receipt of Notice of Arbitration
Appointment of Arbitral Tribunal by Parties
3 days of receipt of Notice of Arbitration
520 days of receipt of Notice of Arbitration
Unnecessary given the Appointing Committee process outlined in section 5.2 of the Draft Arbitration Rules and no justification provided by Big 3
Appointment of Arbitral Tribunal through Appointing Committee Process
Seven days from receipt of list of three potential arbitrators from Appointing Committee; if no agreement, a further 2 days within which each Party may strike out the name of one arbitrator
If no agreement within seven days of receipt of list from Appointing Committee, a further 5 days21 within which each Party may strike out the name of one arbitrator.
Unnecessary, given amount of time since Notice of Arbitration for Parties to consider issues and seven days already expired to consider list of three potential arbitrators from Appointing Committee
Size of Arbitral Tribunal
Default to single arbitrator
Default to 3-person Arbitral Tribunal22
DGRB-002-08 states that three-arbitrator model is reserved for complex situations, such as a request for national roaming or multi-site tower agreement. Three-arbitrator model should be exception, not rule, as it will add cost. With adoption of MTS Allstream's template agreement or alternative proposal, complexity will be reduced.
Oral Hearing To be completed within 3 days or less
To be completed in 5 23days or less
Unnecessary, especially with adoption of MTS Allstream's template agreement or alternative proposal, which would reduce any complexity.
Transcripts No transcripts to be required.
Big 3 argue that transcripts should be allowed if one or both Parties agree to cover the costs.24
Transcripts should not be permitted unless directed by the Arbitral Tribunal or on consent of Parties.
Timelines Approximately 90 days from Notice of Arbitration
Rogers argues for significant expansion of timelines ; expansion to 130 days from Notice of Arbitration
In addition to the 90-day negotiation period, the additional 40 days proposed by Rogers does not appear justified in any way.
H) Rights of Appeal – Finality of Arbitral Decisions
50. MTS Allstream concurs with the Department's view that rights of appeal to the courts or
otherwise should be kept to a minimum. More importantly, the Conditions of Licence
explicitly state that "any arbitral award or results under this condition of licence shall be
19 Bell Mobility, 23 June 2008 Appendix, section 4.1.1. 20 Bell Mobility, 23 June 2008 Appendix, section 5.1. 21 Bell Mobility, 23 June 2008 Appendix, section 5.2. 22 Bell Mobility, 23 June 2008 Appendix, section 5.3. 23 Bell Mobility, 23 June 2008 Appendix, section 9.8(b) 24 Bell Mobility, 23 June 2008 Appendix, section 9.8(c).
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Mr. Peter Hill 18 July 2008 Page 18 of 19
final and binding with no right of appeal subject to applicable provincial or territorial
legislation."
51. The provisions of the Draft Arbitration Rules at paragraph 1.1(l), section 2.6 and 11.5
(section 11.7 of MTS Allstream's blacklined version attached at Appendix A) balance the
public interest in avoiding limitless rights of appeal and a recognition that a Party may
not derogate from certain provisions of laws of arbitration relating to rights of judicial
review.
52. In this regard, MTS Allstream notes that the Big 3 are quick to argue that the Draft
Arbitration Rules engender uncertainty as to whether or not rights of judicial review are
precluded.25 And yet, in their discussion, the Big 3 fail to take into consideration
section 2.6 of the Draft Arbitration Rules, which provides that in the event of conflict with
any provisions of the Law of the Arbitration (by default, the Arbitration Act, 1991 of
Ontario) from which the Parties cannot derogate, the provisions of the Law of the
Arbitration are to prevail.
53. MTS Allstream submits that the provisions of the Draft Arbitration Rules are clear that
the Parties should have no rights of appeal or judicial review other than those rights from
which the Parties cannot derogate by operation of law. As a result no change to the
Draft Arbitration Rules to clarify this point is required.
54. However, MTS Allstream reiterates that, pending appeal or review by a court or any
other body, a Party that is a Responding Licensee pursuant to Conditions of Licence
may not refuse to grant roaming or site sharing in accordance with the terms of the
25 See for example, Bell Mobility at paragraphs 34-38, which make no reference to section 2.6 of the Draft
Arbitration Rules. In addition, Bell Mobility assumes that there will be a further right of judicial review to Federal Court pursuant to section 18.1 of the Federal Courts Act. MTS Allstream notes that there is some doubt as to the validity of this proposition: see Team Transport Services Ltd. v. Klair, 2008 BCCA 226, 2008 CarswellBC 1062, affirmed 2007 BCSC 1394, 2007 CarswellBC 2241, [2007] B.C.W.L.D. 5691 (B.C. S.C. [In Chambers]), which reports the decision on a judicial review application from the decision of an arbitral panel appointed pursuant to an agreement, which licensees under the Canada Transportation Act were compelled to enter into by virtue of an Order in Council made pursuant to section 47 of the Canada Transportation Act. The agreement stated that the arbitration was to be conducted pursuant to the British Columbia Commercial Arbitration Act. Notwithstanding the compulsion to enter into the arbitration agreement was solely derived from a federal statute, the British Columbia Supreme Court exercised its review jurisdiction and no party appears to have argued that the arbitral panel so appointed was subject to the review jurisdiction of the Federal Court.
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Mr. Peter Hill 18 July 2008 Page 19 of 19
award, subject to any decision on appeal or review by a court or any other body.26 This
point is not addressed in the Draft Arbitration Rules and should be clarified in the
interests of certainty and the promotion of competitive entry.
IV. CONCLUSION
55. The arbitration rules in their final form should be designed to minimize instances in which
the parties will have the need to resort to arbitration. In other words, the rules of
arbitration should incent both the Requesting Operator and the Responding Licensee
that controls an existing telecommunications network or an antenna tower or other site,
to propose good faith terms from the outset and to negotiate in good faith within the
90 day-period of receipt of a Proposal for roaming/site sharing.
56. MTS Allstream submits that the Draft Arbitration Rules as originally proposed by the
Department appear to be designed to act on the foregoing incentives. MTS Allstream's
comments and proposals in relation to the Draft Arbitration Rules will enhance the just,
speedy and cost-effective determination of disputes that may arise in relation to
mandated roaming/site sharing. With the additional clarity proposed by MTS Allstream,
the arbitration rules will indeed further the realization of the Minister's objective of
ensuring greater competition in Canadian mobile wireless telephony markets and
delivering to Canadian consumers the benefits of greater innovation and choice that only
competition can bring.
*** End of document ***
26 The ADR Institute made a similar proposal in its 22 January 2008 comments in the Gazette Notice DGRB-010-07
proceeding.
Industry Canada – Arbitration Rules