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


Mr. Peter Hill 18 July 2008 Page 1 of 19

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).



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;



(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



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



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.



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.



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.



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



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



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.



(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.



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.



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.



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.



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.



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.



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).



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.



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.


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