Ottawa's Globalive decision overturned by court

A Federal Court justice has struck down the 2009 government decision that allowed Globalive to launch its Wind Mobile wireless brand.

A Federal Court justice has struck down the 2009 government decision that allowed Globalive to launch its Wind Mobile wireless brand.

Wind Mobile chairman Anthony Lacavera speaks during the company's launch in December 2009. A federal court struck down Ottawa's decision to overrule the CRTC and allow the company to launch a wireless service. ((Darren Calabrese/Canadian Press))

The Canadian Radio-television and Telecommunications Commission had originally found Globalive's complicated ownership structure — it is majority-funded by Egyptian billionaire Naguib Sawiris's Orascom empire — was in breach of Canada's limits on foreign ownership.

But the cabinet overruled that decision in December 2009, paving the way for the company's Wind Mobile launch that same month.

On Friday, Federal Court Justice Roger Hughes found Ottawa's move was based on "errors of law" and ruled it null and void. He also ordered a 45-day stay in the ruling, meaning the company has time to appeal and continue to operate in the interim.

"We are very disappointed with this decision," Globalive chairman Anthony Lacavera said. "We are examining our options but this is not over yet. We don't intend to back down."

Since its launch a little more than a year ago, Wind has already accumulated 250,000 customers, he noted.

Industry Minister Tony Clement said the government is studying the ruling and examining its options. "Our [government] stands with consumers who want more competition," he said in a tweet.

Later, Clement commented on the decision in an interview to air Saturday on CBC Radio's The House.

"I'll be studying the decision and reviewing our options, but … our government still believes very strongly that we should be on the side of consumers, and what consumers want is more choice," Clement told host Kathleen Petty.

Clement said the case came down to the fact the wireless auction that Globalive bid on was for Canadian companies only, and the CRTC had decided it had too much foreign ownership due to its Egyptian investment. The cabinet overturned the CRTC, and the federal court struck down the cabinet's decision Friday.

"Globalive, cabinet decided, was Canadian enough to participate in the auction. And so that's the decision we have to, in terms of the Federal Court decision, have to decide whether to appeal their judgment that we were wrong in that regard."

The case was brought by Wind competitor Public Mobile.

"We believe cabinet's decision is unfair to other wireless carriers, especially new entrants like Public Mobile that have played by the rules and secured substantial Canadian investment," Public Mobile CEO Alek Krstajic said in launching the suit.