Regulating Resellers: Important Changes to the Telecommunications Industry

In an effort to enable companies to be proactive about recent legislative changes, we are sending out this communication (written by Caravel Law’s own Benjamin Rovet) regarding the CRTC’s recent compliance and enforcement directives set out in Telecom Regulatory Policy CRTC-2016-442.

Telecom Regulatory Policy 2017-11 – A Summary

Until recently, the CRTC enjoyed a limited ability to directly regulate resellers. The Telecommunications Act (the “Act”) provided the CRTC with the ability to regulate only “telecommunications common carriers”, i.e. those carriers who own or operate a transmission facility used to provide telecommunications services to the public.

Resellers are telecommunications services providers (“TSPs”) who do not own or operate their own transmission facilities, but rather lease facilities from wholesale providers in order to provide telecommunications services. To ensure that resellers abide by applicable CRTC decisions and rules, the CRTC has engaged in indirect regulation and requires telecommunications common carriers to include in their tariffs and service agreements with resellers certain mandatory provisions, mostly centering around consumer safeguards, but also the requirement that resellers register with the CRTC.

In December 2014, the Act was amended to grant the CRTC the authority to:

  • impose general administrative monetary penalties (AMPs) to promote compliance with the Act and any regulation or decision under the Act; and
  • directly regulate non-carriers (i.e. resellers).

Last year the CRTC surveyed carriers and discovered that there are at least 3,000 resellers who have not registered. As a result, the CRTC recently released Telecom Regulatory Policy 2017-11. In that decision, the CRTC decided to take up its authority under the Act and directed that all persons who provide telecommunications services (i.e. resellers) must (i) abide by all applicable existing consumer safeguard obligations; and (ii) register with the Commission prior to receiving services from a carrier. Further, resellers who provide wholesale telecommunications services to resellers, must also include these requirements in their agreements and service arrangements with other resellers.

Resellers who have yet to register must do so by July 17, 2017. Resellers entering into new contracts (including renewals and amendments) with carriers will have to register prior to receiving telecommunication services for resale. Resellers who do not register by the foregoing deadline could face penalties (i.e. AMPs) and require their underlying wholesale providers to cease providing services.

Should you (or anyone you know) provide telecommunications services in Canada and would like to be advised/assisted with complying with these changes, please contact:

Shari Zinman | CARAVEL LAW
Director of Client and Lawyer Happiness

p: 416-348-0313, ext. 108
e: |

Thank you,

Caravel Law

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