Decision on the Spectrum Licence Renewal Process for Non-Auctioned Broadband Radio Service (BRS) Licences

DGSO-001-20
March 2020

 
 
 

1. Intent

1. Through the release of this document, Innovation, Science and Economic Development Canada (ISED), on behalf of the Minister of Innovation, Science and Industry (the Minister), hereby announces the decisions resulting from the consultation undertaken inCanada Gazettenotice DGSO-002-19,Consultation on the Spectrum Licence Renewal Process for Non-Auctioned Broadband Radio Services (BRS) Licences (the Consultation).

2. All comments and reply comments received in response to the Consultation are available on ISED’sSpectrum management and telecommunications website. Comments and/or reply comments were received from:

  • Bell Mobility Inc. (Bell)
  • Cogeco Communications Inc. (Cogeco)
  • Ecotel Inc. (Ecotel)
  • Québecor Média Inc. (Québecor)
  • Rogers Communications Canada Inc. (Rogers)
  • Saskatchewan Telecommunications (SaskTel)
  • Shaw Communications Inc. (Shaw)
  • SSi Micro Ltd. (SSi)
  • TELUS Communications Inc. (TELUS)
  • Xplornet Communications Inc. (Xplornet)

3. This document (hereinafter referred to as the Decision) sets out decisions for the renewal of non-auctioned broadband radio services (BRS) licences.

2. Mandate

4. The Minister, through theDepartment of Industry Act, theRadiocommunication Actand theRadiocommunication Regulations, with due regard to the objectives of theTelecommunications Act, is responsible for spectrum management in Canada. As such, the Minister is responsible for developing goals and national policies for spectrum utilization and for ensuring effective management of the radio frequency spectrum resource.

3. Policy objectives

5. In developing policies and licensing frameworks to make spectrum available or to renew existing licences, ISED is guided by the policy objectives of theTelecommunications Act, and theSpectrum Policy Framework for Canada (SPFC), which seeks to maximize the economic and social benefits that Canadians derive from the use of the radio frequency spectrum resource. These objectives, along with the enabling guidelines outlined in the SPFC, continue to provide relevant direction to ISED in the delivery of its mandate to manage Canada’s spectrum resource.

6. ISED recognizes that Canadians want three things from their telecom services: high quality, broad coverage and affordable prices. Canadians rely on mobile services to access a variety of mobile applications, such as multi-media services, social networking and Internet browsing, to do business, to connect with others, and to manage finances, health and homes.

7. Through theInnovation and Skills Planand its focus on people, technologies and companies, the Government of Canada is committed to promoting growth across all sectors of the Canadian economy. The ubiquity of wireless technologies and services across sectors is a defining feature of this digital economy. The spectrum discussed in this Decision supports the development of Canada’s digital economy and the goals of the Innovation and Skills Plan by enabling Canadians to participate in the digital economy. Consequently, ISED’s objectives for the renewal of the relevant licences are to:

  • foster innovation and investment
  • support sustained competition so that consumers and businesses benefit from greater choice
  • facilitate deployment and timely availability of services across the country

4. Background

8. Following the designation of the 2500-2690 MHz frequency band for flexible use, ISED issued BRS licences to incumbent Multipoint Communication System and Multipoint Distribution System licensees for approximately two-thirds of their originally licensed spectrum (herein referred to as non-auctioned BRS licences). The remaining one-third of spectrum was returned to ISED and was auctioned in 2015. The majority of non-auctioned BRS licences will expire on March 31, 2021.

9. With the licence term near expiration, ISED issued Canada Gazette notice DGSO-002-19, Consultation on the Spectrum Licence Renewal Process for Non-Auctioned Broadband Radio Services (BRS) Licences. The Consultation sought input on four primary issues:

  • renewal eligibility
  • licence term
  • implementation of spectrum usage
  • other conditions of licence for renewed non-auctioned BRS licences

5. Renewal eligibility

10. The majority of non-auctioned BRS licences will expire on March 31, 2021. In the Consultation, ISED proposed to renew these licences where the licensee was able to demonstrate compliance with all conditions of licence.

Comments

11. Ecotel, Cogeco, SaskTel, SSi, Rogers, Bell and Shaw agreed with the proposal that non-auctioned BRS licences be renewed where licensees could demonstrate compliance with all conditions of licence. Moreover, Ecotel and Cogeco stated that no licences should be renewed if the licensee cannot demonstrate that services are being provided to customers.

12. Ecotel and Cogeco also proposed that any returned or non-renewed spectrum be made available on a first-come, first-served basis.

13. Xplornet suggested that ISED treat both the 2500 MHz and 3500 MHz bands similarly, as both are valuable mid-range frequency bands that support 5G technology. They also recommended that ISED take a holistic assessment of all available mid-band 5G spectrum when developing policy. In their reply comments, Bell, SSi, SaskTel, Shaw and Rogers disagreed with Xplornet’s proposal, citing the previous fundamental reallocation of the 2500 MHz band and resulting return of one-third of the authorized spectrum (as explained in paragraph 8, above).

Discussion

14. As stated in the Framework for Spectrum Auctions in Canada (FSAC), at the end of the initial licence term, or any subsequent term, licensees will have a high expectation of renewal unless a breach of licence condition has occurred, a fundamental reallocation of spectrum to a new service is required or an overriding policy need arises.

15. ISED fundamentally reallocated the 2500 MHz band in 2006 when designating it for mobile, fixed and broadcasting use (DGTP-002-06, Policy Provisions for the Band 2500-2690 MHz to Facilitate Future Mobile Service). Under the DGTP-002-06 Policy, any of the allocated services could be used, including mobile, fixed or broadcasting. Prior to being issued a flexible-use licence, licensees were required to return some of their originally authorized spectrum in the band, a similar process to the recent 3500 MHz fundamental reallocation decision.

16. ISED is not planning another fundamental reallocation of the 2500 MHz spectrum, nor is there any overriding policy need that would preclude renewal of these licences at this time. Accordingly, ISED proposed to renew all non-auctioned BRS licences where the licensee is able to demonstrate that they comply with all licence conditions, including deployment. In the Consultation, ISED proposed that deployment will be considered satisfied where the licensee can demonstrate that they are actively providing commercial wireless services with their licence to at least the minimum levels set out in annex C of Decisions on the Transition to Broadband Radio Service (BRS) in the Band 2500-2690 MHz and Consultation on Changes Related to the Band Plan. ISED believes that licences should be renewed if the spectrum is providing services and is being put to use. If licensees fail to deploy to the minimum level, they would not be eligible for a new long-term spectrum licence under the renewal process. As such, any licences returned to ISED may be made available in a future licensing process, subject to a public consultation.

Decision

A. Where all conditions of licence for the non-auctioned BRS licences have been met, including the deployment conditions as set out in paragraph 16 above, licensees will be eligible for new spectrum licences through this renewal process.

6. Licence term

17. Non-auctioned BRS licences will begin to expire on March 31, 2021, whereas auctioned BRS licences will expire on March 31, 2035, at the end of their current 20-year licence term.

18. In the Consultation, ISED proposed that non-auctioned BRS licences be renewed with a licence term of 14 years (to March 31, 2035), in an effort to harmonize the expiry of all BRS licences within the band.

Comments

19. The majority of respondents, including Rogers, Ecotel, SaskTel, Shaw, SSi, TELUS and Xplornet, supported the proposed 14-year licence term where all conditions of licence have been met, agreeing with ISED’s objective of harmonizing the expiry date of BRS licences.

20. Rogers, SSi and Xplornet included the caveat that upon expiry in 2035, that both auctioned BRS and non-auctioned BRS licences have a high expectation of renewal for a future term of 20 years.

21. Bell disagreed with the proposed term and recommended ISED renew non-auctioned BRS licences for 20 years, to ensure greater certainty in network planning and return on investment.

22. Cogeco held no preference concerning the licence term as long as mid-term deployment conditions are increased to a Tier 4 level to support rural deployment.

Discussion

23. Within the FSAC, ISED adopted a flexible approach in determining licence terms, allowing for licence terms of up to 20 years. ISED recognizes that licence terms in excess of 10 years create greater incentives for financial institutions to invest in the telecommunications industry and for the industry to further innovate and invest in the development of network infrastructure and technologies.

24. A 14-year licence term provides the necessary certainty for companies to continue to invest and expand their networks. It also effectively harmonizes the expiry of BRS licences within the band, streamlining and reducing some of the reporting requirements.

25. Consistent with the FSAC, and noting that the Minister retains the discretion to amend terms and conditions of licence at any time, a licence term of 14 years will apply to renewed non-auctioned BRS licences.

Decision

B. Where all conditions of licence for the non-auctioned BRS licences have been met, including the deployment conditions as set out in paragraph 16 above, licensees will be eligible for renewal for a 14-year term through this renewal process.

7. Implementation of spectrum usage

26. Deployment requirements are a condition of licence that requires licensees to deploy services to a minimum percentage of the population within the licence area, within a specified timeline. ISED uses deployment requirements to facilitate timely availability of services across the country, including rural areas.

27. Non-auctioned BRS licensees are required to meet deployment requirements on a Tier 3 level (with the exception of the Yukon, the Northwest Territories and Nunavut, which will be required to deploy on a Tier 4 level) as set out in annex C of Decisions on the Transition to Broadband Radio Service (BRS) in the Band 2500–2690 MHz and Consultation on Changes Related to the Band Plan.

28. The Consultation proposed to harmonize deployment requirements within the BRS band. As proposed, licencees of renewed non-auctioned BRS licences would be required to meet mid-term deployment levels (10-50% of population coverage) on a Tier 3 level (with the exception of the Yukon, the Northwest Territories and Nunavut, which will be required to deploy on a Tier 4 level), corresponding with auctioned BRS licences deployment conditions. In addition, it was also proposed that non-auctioned BRS licensees must continue to meet these minimum population coverage levels for the remainder of the licence term to be eligible for renewal.

Comments

29. Bell, SaskTel, Shaw, SSi, TELUS and Xplornet supported the harmonization of deployment requirements given the predictability and certainty it would provide the carriers for network planning and deployment.

30. Conversely, Rogers did not see the need to maintain deployment requirements, stating that 99% of Canada’s population already has access to wireless services. However, Rogers did agree with ISED’s proposal to harmonize deployment requirements, should ISED decide there is still a need.

31. Ecotel and Cogeco proposed ISED impose stronger deployment requirements, by increasing population coverage levels as a condition of licence to a Tier 4 area basis by 2025. Ecotel stressed that Tier 4 deployment requirements would promote deployment to rural and remote areas by providing an incentive for licensees to either deploy more broadly or enter into subordination arrangements.

32. As another means to promote rural deployment, Cogeco suggested that any unused Tier 4 portions of licences be returned to ISED and made available to those who can demonstrate their capacity to use the spectrum. Cogeco further suggested that any licensee that has entered into a subordinate licensing arrangement prior to the licence’s expiry be afforded a grace period of three additional years to deploy.

Discussion

33. The renewal decision provides an opportunity to harmonize the deployment conditions for BRS licences and ensure that the spectrum is used for the economic and social benefit of Canadians. As noted by Bell, SaskTel, Shaw, SSi, TELUS and Xplornet, the harmonization would promote the predictability and certainty needed for network planning and deployment for carriers.

34. It was proposed that ISED could incentivize rural deployment by imposing more stringent deployment requirements and increasing deployment conditions to a Tier 4 level. Whilst ISED is focused on increasing rural deployment, increasing deployment conditions for renewed licences would create a new subset of licence conditions and would create unnecessary complexity and uncertainty for network planning.

35. As specified in annex B of the Consultation, these licences are transferable in whole or in part, in both bandwidth and geographic dimension. A subordinate licence may also be issued. To maximize the benefits that Canadians derive from the use of the spectrum, ISED encourages subordination in cases where the licensee does not plan to deploy services.

36. The current Framework Relating to Transfers, Divisions and Subordinate Licensing of Spectrum Licences for Commercial Mobile Spectrum (the Transfer Framework) is effective in facilitating subordination agreements, and relies upon market forces rather than regulatory measures. Any policy changes regarding mandatory subordination would be subject to a separate consultation.

Decision

C. Deployment levels for BRS licences issued through this renewal process will apply as follows:

• Mid-term deployment: Tier 3 population coverage level by March 31, 2025 (with the exception of the Yukon, the Northwest Territories and Nunavut, which will be required to deploy on a Tier 4 population coverage level). See annex A of this Decision.

• Thereafter licensees will be required to meet these minimum population coverage levels on an ongoing basis until March 31, 2035.

8. Other conditions of licence for renewed non-auctioned BRS licences

37. In addition to conditions of licence already discussed, ISED sought comments on all other proposed conditions of licence for non-auctioned BRS licences issued through the renewal process as set out in annex B of the Consultation. Other conditions of licence that received comments include:

  • mandatory roaming
  • lawful interception
  • research and development
  • annual reporting
  • mandatory subordination

8.1 Mandatory roaming

38. The following section discusses comments received regarding mandatory roaming conditions that would apply to renewed non-auction BRS licences.

Comments

39. Bell and TELUS opposed mandatory roaming and recommended its removal as a condition of licence, suggesting that it was no longer necessary given the Canadian Radio-television and Telecommunications Commission’s (CRTC) mandate requiring national wireless operators to offer certain wholesale wireless roaming services. Bell asserted that mandatory roaming is at odds with the principle of facilities-based competition and acts as a disincentive to network infrastructure investment since a carrier could choose to roam instead of invest. This sentiment was echoed by TELUS, who requested ISED reconsider this condition on all licences, not just BRS licences. Bell and TELUS believe that all licences should be subject to competitive market forces and emphasized the importance of competitive market forces for 5G networks.

40. Cogeco, SSi, Rogers, Xplornet, Shaw and Québecor supported maintaining the mandatory roaming condition of licence, given the Client Procedures Circular (CPC) 2-0-17, Conditions of Licence for Mandatory Roaming and Antenna Tower and Site Sharing and to Prohibit Exclusive Site Arrangements covers areas not duplicated by the CRTC Telecom Regulatory Policy CRTC 2015-177, Regulatory framework for wholesale mobile wireless services. Rogers expressed support for the CPC-2-0-17 roaming request process as the commercial negotiation timelines and obligatory arbitration (if the two parties cannot come to a roaming agreement) has benefited many Canadian mobile customers.

41. Rogers disagreed that mandatory roaming is at odds with facilities-based competition compared to joint network agreements as put forward by Bell and TELUS. Rogers alleged that given Bell and TELUS operate a joint network, the mandatory roaming condition of licence allows Bell and TELUS to avoid investing billions in their own network. Rogers believes the condition of licence mitigates the economic advantage their joint network creates and should be maintained for 5G deployments.

42. Rogers limited their support to only carriers who operate their own network. Cogeco recommended ISED enlarge the scope to include facilities-based networks, providing maximum flexibility for smaller regional carriers to access networks.

43. Shaw, Xplornet and SSi maintained that the issue of mandatory roaming should not be considered as part of the BRS renewal. Instead, the parties assert that the current CRTC review of the wireless services framework will ensure that the federal regime for wholesale wireless services serves the needs of Canadians.

Discussion

44. The mandatory roaming condition of licence is an important part of ISED’s policy as laid out in CPC-2-0-17. The condition of licence balances the objective of encouraging the deployment of networks with access to wholesale roaming services as operators continue to expand their networks.

45. The CRTC’s Telecom Regulatory Policy 2015-177 decision established that the CRTC would regulate the rates of roaming services provided by Bell, Rogers and TELUS to match those of other wireless carriers. It was a response to particular market circumstances and applies to specified national wireless carriers and services. It does not serve the same purpose as ISED’s mandatory roaming condition of licence, nor does it replace the general condition of licence.

46. The mandatory roaming condition of licence applies to all licensees in the Cellular, Personal Communications Services (PCS), Advanced Wireless Services, Mobile Broadband Service and BRS bands. Any changes to this condition would need to be considered in the context of all commercial mobile bands.

47. The elements within the Consultation were limited to the administration of non-auctioned BRS licences. Thus, issues that could affect other licences, such as the potential removal of the mandatory roaming condition from all spectrum licences, would need to be addressed more broadly. Recognizing the differing views, ISED may consult on this condition of licence in the future, within the context of all commercial mobile bands. The mandatory roaming condition of licence will remain as proposed.

8.2 Lawful intercept

48. The following section discusses comments received regarding lawful intercept conditions that would apply to renewed non-auction BRS licences.

Comments

49. Rogers and SSi proposed modifying the condition of licence regarding lawful interception. SSi supported Rogers' call to examine the scope of the condition of licence. Rogers proposed limiting the lawful intercept capabilities to those provided for in industry standards and incorporated in commercially available equipment. Rogers noted that by limiting the scope to industry standards, technology vendors would be more likely to build equipment options available at a lower cost than the current unique proprietary solutions required.

Discussion

50. Lawful interception is an important and well-established technique used by law enforcement and national security agencies to conduct investigations. In the context of telecommunications in Canada, it consists of the interception of communications and the search and seizure of information carried out pursuant to legal authority.

51. For licensees planning to install and operate technologies or topologies that are not circuit-switched or are currently under development, ISED will require that the licensee implement any lawful interception solution available to the licensee.

52. To ensure continued provision of intercept capabilities, as authorized by law, the condition of licence will be adopted as proposed. These standards may be amended from time to time; however, an overall change in approach would be the subject of a consultation through the Solicitor General of Canada.

8.3 Research and development (R&D)

53. The following section discusses comments received regarding R&D conditions that would apply to renewed non-auction BRS licences.

Comments

54. Rogers, Bell, Shaw and SSi requested that ISED eliminate the R&D condition of licence. Rogers also noted that such a requirement is no longer necessary as market forces ensure wireless equipment manufacturers and licensees continue to invest heavily in R&D.

55. While opposed to the condition, Bell and Rogers proposed that at a minimum, ISED lower the revenue exemption threshold and reduce the 2% spending requirements (e.g. to 1%), to prevent distorting the marketplace and free up more capital for investment.

56. SSi and Shaw disagreed with the Bell and Rogers proposal to expand the requirement to include providers who make less than $1 billion in annual gross operation revenues. Shaw cited it would negatively impact smaller providers and reduce incentives to enter the Canadian wireless market by impoverishing new and niche players.

Discussion

57. Investment in R&D is a fundamental part of the telecommunications industry. R&D requirements align with ISED’s spectrum objectives of fostering innovation and investment, and maximizing the economic and social benefits that Canadians derive from the use of the radio frequency spectrum resource.

58. Annual reports submitted by licensees show that, on average, between 2001 and 2010, R&D expenditures by the major carriers exceeded the 2% requirement. ISED considers that the R&D licence condition may pose an administrative and financial burden on small and medium wireless service providers.

59. R&D continues to be recognized as a significant contributing factor to the continuing success of the digital economy in Canada. Maintaining the requirement reaffirms the federal government’s support for research, technology and investment in the current and future prosperity of Canadians.

60. The R&D requirements condition of licence will be adopted as proposed.

8.4 Annual reporting

61. The following section discusses comments received regarding annual reporting conditions that would apply to renewed non-auction BRS licences.

Comments

62. Rogers, Bell, SSi, Xplornet and Shaw favoured removing the annual reporting requirement to decrease the administrative burden on licensees.

63. Bell also recommended lengthening the interval in which submissions and reports are provided to ISED. Alternatively, Bell also proposed a model whereby companies would be required to provide information when requested by ISED. This proposal was supported by Rogers in their reply comments.

64. Bell indicated that ISED should run a separate formal consultation on the need for annual reports.

Discussion

65. Currently, spectrum licence conditions include a requirement to submit an annual report to ISED to provide some basic information on spectrum use as well as existing company reports. These submissions provide ISED with valuable information on spectrum use and are used as a means to efficiently and effectively manage spectrum.

66. ISED recognizes that some of the information contained within these reports is publically available. Balancing the need for current spectrum usage data with the administrative burden concerns raised by licensees, ISED may consult on this licence condition in the future.

67. Until ISED formally consults, the annual reporting condition of licence will remain as proposed.

8.5 Mandatory subordination

68. The following section discusses comments received regarding a mandatory subordination condition that would apply to renewed non-auction BRS licences.

Comments

69. Ecotel and Cogeco recommended ISED include mandatory subordination as a condition of licence, to extend the provision of services to rural areas and facilitate spectrum access in areas where spectrum is not currently being used. Ecotel, highlighting some of their struggles with accessing spectrum through the secondary markets and in entering into agreements with primary licence holders, concluded that mandating subordination would facilitate the process of accessing spectrum on the secondary market.

70. SSi, Bell and Rogers disagreed with mandatory subordination, with Bell and Rogers noting that the current SPFC is the most effective method of facilitating agreements.

71. Bell and Rogers stated that licence terms and deployment conditions are designed to give licensees time to deploy spectrum and earn a return on their investment. Forcing spectrum subordination could hinder a primary licence holder’s future deployment plans in that area and could also interfere with their ability to meet ISED’s current deployment conditions. As Rogers noted, any mandatory process or involuntary sub-division could result in interference and serve as an impediment to future deployment plans.

Discussion

72. ISED recognizes that spectrum sharing and subordination can enable more rapid and targeted deployment of next generation services to Canadians, including those in rural areas. ISED’s approach to spectrum licences has included various measures such as deployment requirements to promote connectivity and subordination.

73. The current SPFC states that market forces should be relied upon to the maximum extent feasible under the Telecommunications Act and that regulatory measures should be minimally intrusive. ISED continually processes subordinate applications for rural areas. Subordination and other spectrum sharing agreements are negotiated on a voluntary basis to ensure that the primary licensee’s deployment plans are not impacted to the detriment of their subscribers and planned network expansions.

74. As stated in the Spectrum Outlook 2018 to 2022, with the anticipated increased demand for spectrum and the growing importance of wireless services for Canadians in all regions, ISED will develop licensing policies to ensure that Canadians in all areas of the country, including rural areas, benefit from the latest technologies including 5G. ISED is undertaking a review of spectrum access in the secondary market to identify any gaps and opportunities. These policies will be developed in a transparent manner through consultation.

Decision

D. The conditions of licence in annex B of this Decision will apply to all renewed non-auctioned BRS spectrum licences issued through this renewal process.

9. Fees for renewed spectrum licences

75. The following section discusses comments received regarding fees that would apply to renewed non-auction BRS licences.

Comments

76. Rogers, TELUS and SSi proposed a decrease in spectrum licence fees. Rogers and SSi expressed adopting an administrative cost-recovery spectrum fee regime, similar to the one in the U.S., which would allow facilities-based network operators to invest greater amounts of capital in new technologies and expand current network capacity and coverage. SSi also proposed lowering licence fees, specifically lower than PCS and cellular licence fees.

Discussion

77. The FSAC states that for licences issued through a renewal process, licence fees that reflect some measure of market value will apply.

78. This fee regime could be addressed in a future consultation to determine BRS licence fees. ISED intends to consult on a new licence fee applicable to all BRS licences issued to incumbents either through the voluntary conversion process, the transition policy or at auction.

Decision

10. Next steps

79. Licences that are not renewed will be reassigned through a subsequent licensing process. This subsequent licensing process will be the subject of a future consultation.

11. Obtaining copies

80. All spectrum-related documents referred to in this paper are available on ISED’s Spectrum management and telecommunications web page.

81. For further information concerning the decisions outlined in this paper or related matters, contact:

Innovation, Science and Economic Development Canada
c/o Senior Director, Spectrum Operations
235 Queen Street, 6th Floor
Ottawa ON K1A 0H5
Email: ic.spectrumoperations-operationsduspectre.ic@canada.ca

Annex A: Deployment requirements

Annex A: Deployment requirements

Tiers 3 and 4

Service area name

Minimum population coverage

3-01

Newfoundland and Labrador

30%

3-02

Prince Edward Island

30%

3-03

Mainland Nova Scotia

40%

3-04

Cape Breton

30%

3-05

Southern New Brunswick

50%

3-06

Western New Brunswick

30%

3-07

Eastern New Brunswick

30%

3-08

Bas du fleuve/Gaspésie

15%

3-09

Québec

50%

3-10

Chicoutimi-Jonquière

40%

3-11

Eastern Townships

30%

3-12

Trois-Rivières

30%

3-13

Montréal

50%

3-14

Upper Outaouais

10%

3-15

Ottawa/Outaouais

50%

3-16

Pembroke

15%

3-17

Abitibi

30%

3-18

Cornwall

50%

3-19

Brockville

40%

3-20

Kingston

50%

3-21

Belleville

40%

3-22

Cobourg

30%

3-23

Peterborough

50%

3-24

Huntsville

30%

3-25

Toronto

50%

3-26

Barrie

30%

3-27

Guelph/Kitchener

50%

3-28

Listowel/Goderich/Stratford

15%

3-29

Niagara-St. Catharines

50%

3-30

London/Woodstock/St. Thomas

50%

3-31

Chatham

50%

3-32

Windsor/Leamington

50%

3-33

Strathroy

50%

3-34

North Bay

40%

3-35

Sault Ste. Marie

50%

3-36

Sudbury

50%

3-37

Kirkland Lake

30%

3-38

Thunder Bay

40%

3-39

Winnipeg

50%

3-40

Brandon

20%

3-41

Regina

40%

3-42

Moose Jaw

25%

3-43

Saskatoon

40%

3-44

Edmonton

50%

3-45

Medicine Hat/Brooks

30%

3-46

Lethbridge

40%

3-47

Calgary

50%

3-48

Red Deer

25%

3-49

Grande Prairie

25%

3-50

Kootenays

15%

3-51

Okanagan/Columbia

40%

3-52

Vancouver

50%

3-53

Victoria

50%

3-54

Nanaimo

40%

3-55

Courtenay

50%

3-56

Thompson/Cariboo

40%

3-57

Prince George

40%

3-58

Dawson Creek

30%

4-170

Yukon

20%

4-171

Nunavut

20%

4-172

Northwest Territories

20%

Annex B: Conditions of licence

1. The following conditions are for renewed non-auctioned BRS spectrum licences.

2. It should be noted that the licences are subject to the relevant provisions in the Radiocommunication Act and the Radiocommunication Regulations, as amended from time to time. For example, the Minister of Innovation, Science and Industry continues to have the power to amend the terms and conditions of spectrum licences, under paragraph 5(1)(b) of the Radiocommunication Act. The Minister may do so for a variety of reasons, including furtherance of the policy objectives set out in section 7 of the Telecommunications Act and the policy objectives related to this band. Such action would normally only be undertaken after consultation.

3. The licensee must be fully aware of its obligations with respect to licence terms and conditions. Innovation, Science and Economic Development Canada (ISED) will monitor compliance and take any necessary action to ensure compliance and to enforce the provisions of the Radiocommunication Act and the Radiocommunication Regulations.

B1. Licence term

4. The term of this licence is 14 years from the date of renewal (March 31, 2021). At the end of this term, the licensee will have a high expectation that a new licence will be issued for a subsequent term through a renewal process unless a breach of licence condition has occurred, a fundamental reallocation of spectrum to a new service is required, or an overriding policy need arises.

5. The process for issuing licences after this term and any issues relating to renewal, including the terms and conditions of the new licence, will be determined by the Minister following a public consultation.

B2. Eligibility

6. The licensee must comply on an ongoing basis with the applicable eligibility criteria in subsection 9(1) of the Radiocommunication Regulations. The licensee must notify the Minister of any change that would have a material effect on its eligibility. Such notification must be made in advance of any proposed transactions within its knowledge.

B3. Licence transferability, divisibility and subordinate licensing

7. This licence is transferable in whole or in part (divisibility), in both bandwidth and geographic dimensions, subject to ISED’s approval. A Subordinate Licence may also be issued in regard to this licence. ISED’s approval is required for each proposed Subordinate Licence.

8. The licensee must make the Transfer Request in writing to ISED. The Transfer Request will be treated as set out in Client Procedures Circular CPC-2-1-23, Licensing Procedure for Spectrum Licences for Terrestrial Services, as amended from time to time.

9. The licensee must apply in writing to ISED for approval prior to implementing any Deemed Transfer, which will be treated as set out in CPC-2-1-23. The implementation of a Deemed Transfer without the prior approval of ISED will be considered a breach of this condition of licence.

10. Should the licensee enter into any Agreement that provides for a Prospective Transfer with another holder of a Licence for commercial mobile spectrum (including any Affiliate, agent or representative of the other licence holder), the licensee must apply in writing to ISED for review of the Prospective Transfer within 15 days of entering into the Agreement, which will be treated as set out in CPC-2-1-23. Should ISED issue a decision indicating that the Prospective Transfer is not approved, it will be a breach of this condition of licence for a licensee to remain in an Agreement that provides for the Prospective Transfer for a period of more than 90 days from the date of the decision.

11. In all cases, the licensee must follow the procedures as outlined in CPC-2-1-23.

12. All capitalized terms have the meaning ascribed to them in CPC-2-1-23.

B4. Treatment of existing spectrum users

13. The licensee must comply with all displacement and/or transition policies set out in SMSE-005-11, Decisions on a Band Plan for Broadband Radio Service (BRS) and Consultation on a Policy and Technical Framework to Licence Spectrum in the Band 2500-2690 MHz. In addition, the licensee must not cause harmful interference to the grandfathered stations in Manitoba, as per DGSO-001-10, Decisions on the Transition to Broadband Radio Service (BRS) in the Band 2500-2690 MHz and Consultation on Changes Related to the Band Plan.

B5. Radio station installations

14. The licensee must comply with Client Procedures Circular CPC-2-0-03, Radiocommunication and Broadcasting Antenna Systems, as amended from time to time.

B6. Provision of technical information

15. When ISED requests technical information on a particular station or network, the licensee must provide the information in accordance with the definitions, criteria, frequency and timelines specified in the request. For further information, refer to Client Procedures Circular CPC-2-1-23, Licensing Procedure for Spectrum Licences for Terrestrial Services, as amended from time to time.

B7. Compliance with legislation, regulation and other obligations

16. The licensee is subject to, and must comply with, the Radiocommunication Act and the Radiocommunication Regulations, as amended from time to time. The licensee must use the assigned spectrum in accordance with the Canadian Table of Frequency Allocations and the spectrum policies applicable to this band, as amended from time to time. The licence is issued on condition that all representations made in relation to obtaining this licence are all true and complete in every respect.

B8. Technical considerations, and international and domestic coordination

17. The licensee must comply on an ongoing basis with the technical aspects of the appropriate Radio Standards Specifications (RSS) and Standard Radio System Plans (SRSP), as amended from time to time. Where applicable, the licensee must use its best efforts to enter into mutually acceptable agreements with other parties for facilitating the reasonable and timely development of their respective systems, and to coordinate with other licensed users in Canada and internationally.

18. The licensee must comply with the obligations arising from current and future frequency coordination agreements established between Canada and other countries and shall be required to provide information or take actions to implement these obligations as indicated in the applicable SRSP. Although frequency assignments are not subject to site licensing, the licensee may be required through the appropriate SRSP to furnish all necessary technical data for each relevant site.

B9. Lawful interception

19. The licensee operating as a telecommunication common carrier using the spectrum for voice telephony systems must, from the inception of service, provide for and maintain lawful interception capabilities as authorized by law. The requirements for lawful interception capabilities are provided in the Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications (Rev. Nov. 95). These standards may be amended from time to time.

20. The licensee may request the Minister to forbear from enforcing certain assistance capability requirements for a limited period of time. The Minister, following consultation with Public Safety Canada, may exercise the power to forbear from enforcing a requirement or requirements where, in the opinion of the Minister, the requirement is not reasonably achievable. Requests for forbearance must include specific details and dates indicating when compliance to the requirement can be expected.

B10. Research and development (R&D)

21. The licensee must invest, as a minimum, 2% of its adjusted gross revenues resulting from the use of this licence, averaged over the term of the licence, in eligible R&D activities related to telecommunications. Eligible R&D activities are those that meet the definition of scientific research and experimental development adopted in the Income Tax Act, as amended from time to time. Adjusted gross revenues are defined as total service revenues, less inter-carrier payments, bad debts, third-party commissions, and provincial goods and services taxes collected. The licensee is exempt from R&D expenditure requirements if it, together with all affiliated licensees that are subject to the R&D condition of licence, has less than $1 billion in annual gross operating revenues from the provision of wireless services in Canada, averaged over the term of the licence. For this condition of licence, an affiliate is defined as a person who controls the carrier, or who is controlled by the carrier or by any person who controls the carrier, as per subsection 35(3) of the Telecommunications Act.

B11. General deployment requirement

22. Licensees will be required to demonstrate to the Minister that this spectrum has been put to use, as specified in section 7 and annex A of this Decision, within 4 years of the initial issuance of the licence. When the spectrum is put to use, it shall be used to provide services predominantly to Canadians within the service area.

23. ISED will review licensees’ compliance with their deployment conditions at years 4 and 14. Where, at any point in the licence term, the licensee is not in compliance with its deployment conditions, ISED may invoke various compliance and enforcement measures.

24. These measures may include warning, administrative monetary penalties, legal action, licence amendments, suspensions or other measures. In certain cases of non-compliance, ISED may determine that the most appropriate course of action is to revoke the licence.

25. Where a licence is transferred, the requirement for the new licensee to deploy will continue to be based on the date the initial licence was issued. Deployment by a subordinate licensee will count towards the requirement of the primary licensee.

B12. Mandatory antenna tower and site sharing

26. The licensee must comply with the mandatory antenna tower and site-sharing requirements set out in Client Procedures Circular CPC-2-0-17, Conditions of Licence for Mandatory Roaming and Antenna Tower and Site Sharing and to Prohibit Exclusive Site Arrangements, as amended from time to time.

B13. Mandatory roaming

27. The licensee must comply with the mandatory roaming requirements set out in CPC-2-0-17, as amended from time to time.

B14. Annual report

28. The licensee must submit an annual report for each year of the licence term, which includes all of the following information:

  • a statement indicating continued compliance with all conditions of licence
  • an update on the implementation and spectrum usage within the area covered by the licence
  • existing audited financial statements with an accompanying auditor's report
  • a statement indicating the annual gross operating revenues from the provision of wireless services in Canada and, where applicable, the annual adjusted gross revenues resulting from the use of this licence, as defined in these conditions of licence
  • a report of the R&D expenditures as set out in these conditions of licence; ISED may request an audited statement of R&D expenditures with an accompanying auditor's report at its discretion
  • supporting financial statements where a licensee is claiming an exemption based on, together with all affiliated licensees that are subject to the R&D condition of licence, it having less than $1 billion in annual gross operating revenues from the provision of wireless services in Canada, averaged over the term of the licence
  • a copy of any existing corporate annual report for the licensee's fiscal year with respect to the authorization
  • other information related to the licence as specified in any notice updating the reporting requirements as issued by ISED

29. All reports and statements are to be certified by an officer of the company and submitted, in writing, within 120 days of the licensee's fiscal year end. Where the licensee holds multiple licences, spectrum implementation reports should be broken down by licence area. Confidential information provided will be treated in accordance with subsection 20(1) of the Access to Information Act.

30. Reports are to be submitted to ISED at the following address:

Innovation, Science and Economic Development
Spectrum Management Operations Branch
Manager, Operational Policy
235 Queen Street, 6th Floor East
Ottawa  ON  K1A 0H5

Email: ic.spectrumoperations-operationsduspectre.ic@canada.ca

B15. Amendments

31. The Minister retains the discretion to amend these terms and conditions of licence at any time.