LICENSING CONDITIONS IN THE TELECOMMUNICATIONS SECTOR

UNCLAS OTTAWA 001917 SIPDIS STATE FOR EB/CIP, EB/BTA/DCT AND WHA/CAN STATE PASS USTR FOR J.MCHALE AND S.CHANDLER FCC FOR INTERNATIONAL - D.ABELSON, J.MANN AND P.COOPER USDOC FOR 4310/IEP/OOC/WH/J.BENDER USDOC ALSO FOR NTIA - BURR GENEVA FOR USTR E.O. 12958: N/A TAGS: ECPS ETRD CA SUBJECT: LICENSING CONDITIONS IN THE TELECOMMUNICATIONS SECTOR REF: STATE 114687 ¶1. Fees paid by telecommunications carriers in Canada are based on the cost of the regulators' telecommunications-related activities, multiplied by the carrier's share of industry operating revenue (see Telecommunications Fees Regulations, SOR/95-157). Telecoms firms have not complained to us about such costs. Nor are we aware of any capitalization or bonding requirement. ¶2. The main market access barrier is the restriction on foreign ownership. Because non-Canadians may own no more than 46.7 percent of a "facilities-based" telecommunication carrier, U.S. and other foreign telecom players can only enter the Canadian market in partnership with Canadian firms. DICKSON