Canada Plans Radio Spectrum Auction in 2012

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Canada's federal government has announced that it plans to hold a radio spectrum auction in 2012 to allocate the digital dividend spectrum that is due to become available when analogue television signals are switched off at the end of August 2011.

"We know that 700 megahertz is going to be available as people switch to digital TV," Industry Minister Tony Clement told reporters. "And we know that the 2500 megahertz is also going to be available, so I have instructed my department to get ready and to start the process rolling."

The auction is also expected to act as a spur to the government to clarify the laws on foreign shareholding in Canadian telecoms networks. Any confusion over shareholder limits could deter investors and reduce the potential revenues for the government.

Clement also confirmed that he is still considering how to handle the possibility that participants will try to raise funds from foreign investors and whether rules governing foreign ownership should be revised before the auction.

"The two are not really divorced because people have to know what access to capital they're going to have before they can bid in an auction," Clement said. "We have done a series of consultations over the summer with the Canadian public as well as the telecom industry on the issue of foreign capital access and we're considering our options."

The controversy over foreign investors grew when Egypt's Orascom Telecom was found by an investigation to be the de-facto majority investor in new entrant, Globalive. Attempts to block the investment were however overturned by the government.

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Tags: radio spectrum  700mhz  telecom  auction  television  Canada 

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