32607 IN THE SUPREME COURT OF CANADA (ON APPEAL FROM THE FEDERAL COURT OF APPEAL) BETWEEN: Appellant (Appellant) - and-

BELL ALIANT REGIONAL COMMUNICATIONS, LIMITED PARTNERSHIP, THE CONSUMERS' ASSOCIATION OF CANADA, MTS ALLSTREAM INC., THE NATIONAL ANTI-POVERTY ORGANIZATION, PUBLIC INTEREST ADVOCACY CENTRE and COMMUNICATIONS COMPANY Respondents (Respondents) - and-

CANADIAN RADIO-TELEVISION AND TELECOMMUNICATIONS COMMISSION Intervener (Respondent)

AND BET WEE N: TELUS COMMUNICATIONS INC. Appellant (Respondent) - and-

BELL CANADA, ARCH DISABILITY LAW CENTRE, REGIONAL COMMUNICATIONS, LIMITED PARTNERSHIP, CANADIAN RADIO-TELEVISION AND TELECOMMUNICATIONS COMMISSION, THE CONSUMERS' ASSOCIATION OF CANADA, THE NATIONAL ANTI-POVERTY ORGANIZATION, PUBLIC INTEREST ADVOCACY CENTRE and MTS ALLSTREAM INC., TELECOMMUNICATIONS AND SOCIETE EN COMMANDITE TELEBEC Respondents (Respondents)

FACTUM OF THE RESPONDENTIINTERVENER CANADIAN RADIO-TELEVISION AND TELECOMMUNICATIONS COMMISSION - 2 -

Torys LLP Anthony McIntyre Suite 3000 Legal Counsel 79 Wellington Street West Canadian Radio-television and Box 270, TD Centre Telecommunications Commission Toronto, ON M5K lN2 1 Promenade du Portage Gatineau, QC KIA 4BI John B. Laskin Tel: 416.865.7317 Tel: 819.994.7572 [email protected] Fax: 819.953.0589 [email protected] Afshan Ali Tel: 416.865.8233 Ottawa Agent for the Respondent/Intervener, [email protected] Canadian Radio-television and Telecommunications Commission Fax: 416.865.7380

Solicitors for the Respondentlfutervener, Canadian Radio-television and Telecommunications Commission

Blake Cassels & Graydon LLP Gowling Lafleur Henderson LLP 199 Bay Street, Suite 2800 160 Elgin Street, Suite 2600 Commerce Court West Ottawa, ON KIP 853 Toronto, ON M5L 1A9 Neil Finkelstein Brian A. Crane, Q.C. Tel: 416.863.2266 Tel: 613.233.1781 [email protected] Fax: 613.563.9869 [email protected] David Kidd Ottawa Agents for the Appellant, Bell Tel: 613.788.2203 Canada [email protected]

Catherine Beagan Flood Tel: 416.863.2269 [email protected]

Fax: 416.863.2653

Solicitors for the Appellant, Bell Canada - 3 -

Burnet. Duckworth & Palmer LLP Gowling Lafleur Henderson LLP First Canadian Centre 160 Elgin Street - Suite 2600 Suite 1400,350 -7th Ave. SW Ottawa, ON KIN 8S3 Calgary, AB T2P 3N9 Henry S. Brown, Q.c. John E. Lowe Tel: 613.233.1781 Tel: 403.260.0257 Fax: 613.788.3433 Fax: 403.260.0332 [email protected] [email protected]

Solicitors for the Appellant, TELUS Ottawa Agents for the Appellant, TELUS Communications Inc. Communications Inc.

Paliare Roland Rosenberg Rothstein LLP Burke-Robertson 501-250 University Avenue 70 Gloucester Street Toronto, ON M5H 3E5 Ottawa, ON K2P OA2

Richard P. Stephenson Robert E. Houston Tel: 416.646.4325 Tel: 613.236.9665 Fax: 416.646.4335 Fax: 613.235.4430 [email protected] Solicitors for the Respondents, the Consumers' Ottawa Agents for the Respondents, the Association ofCanada, The National Anti-Poverty Consumers' Association of Canada, The Organization and Public Interest Advocacy Centre National Anti-Poverty Organization and Public Interest Advocacy Centre

Cox & Palmer 1100 Purdy's WharfTower One 1959 Upper Water Street P.O. Box 2380 Central Halifax, NS B3J 3E5

Daniel M. Campbell, Q.c. Tel: 902.421.6262 Fax: 902.421.3130 [email protected]

Solicitors for the Respondent, Bell Aliant Regional Communications, Limited Partnership - 4 -

Goodmans LLP Nelligan O'Brien Payne LLP 2400 - 250 Yonge Street 1900 - 66 Slater Street Toronto, ON M5B 2M6 Ottawa, ON KIP 5Hl

Michael Koch Dougald E. Brown Tel: 416.597.5156 Tel: 613.231.8210 Fax: 416.979.1234 Fax: 613.788.3661 [email protected] [email protected]

Solicitors for the Respondent, MTS Allstream Inc. Ottawa Agents for the Respondent, MTS Allstream Inc.

Saskatchewan Telecommunications 2121 Saskatchewan Drive 12th Floor Regina, SK S4P 3Y2

Robert Hersche Tel: 306.777.5346 Fax: 306.565.6216 robert.hersche@.sk.ca

Respondent

ARCH Disability Law Centre 425 Bloor Street East Suite 100 Toronto, ON M4W 3R5

Ivana Petricone Tel: 416.482.8255 Fax: 416.482.2981 [email protected]

Respondent - 5 -

Societe en Commandite Telebec 7151, rue Jean Talon est 7e estage Anjour, PQ HIM 3N8

Allen Mercier, Directeur-Recherche reglementaire Tel: 514.493.5340 Fax: 514.493.5379 [email protected]

Respondent TABLE OF CONTENTS

PART I- STATEMENT OF FACTS 1 Overview : 1 The CommIssIOn. .,s regu1atory an drate-settmg . powers .. 3 Detennining just and reasonable rates 4 Deferral accounts - genesis and rationale 6 Final rates were subject to the price caps/deferral accounts regime 9 The Deferral Accounts Decision 9 Implementation ofthe Deferral Accounts Decision 11 Decision ofthe Federal Court ofAppeal 12 Limits ofthe appellants' arguments 14

PART II - QUESTIONS IN ISSUE 15

PART III - STATEMENT OF ARGUMENT 15 Reasonableness is the appropriate standard ofreview ; 15 No basis for interference with the decision 20 Principles ofstatutory interpretation 21 The Commission had jurisdiction to require the establishment ofdeferral accounts 22 Authority includes authority to direct disposition offunds in deferral accounts 23 The Commission's decision was entirely prospective in purpose and effect 26 Rebates do not constitute a "confiscation" ofILECs' property 29 The Commission and the Court ofAppeal properly applied section 7 30

PART IV - SUBMISSIONS ON COSTS 31

PART V- ORDER SOUGHT 32

PART VI - TABLE OF AUTHORITIES 33

PART VII - RELEVANT STATUTES AND REGULATIONS 35 PART I ~ STATEMENT OF FACTS

Overview

1. The appellants, Bell and TELUS, appeal from the decision ofthe Federal Court ofAppeal upholding the Commission's Deferral Accounts Decision (Telecom Decision CRTC 2006-9). The appellants assert that in the Deferral Accounts Decision, the Commission exceeded its jurisdiction in directing incumbent telecommunication carriers to dispose ofcertain funds in their deferral accounts through rebates to consumers. The appellants fail to make out any proper basis for this Court to interfere with the decision ofthe Federal Court ofAppeal upholding the Commission's decision. The Commission acted fully within the broad jurisdiction conferred on it by Parliament.

2. In directing that certain deferral account funds be put towards subscriber rebates, the Commission did precisely what it is mandated to do under the Telecommunications Act - it made an order in the exercise ofits authority to detennine just and reasonable rates, and did so with a view to the telecommunications policy objectives set out in the Act. Bell and TELUS do not challenge the authority ofthe Commission to require the establishment ofdeferral accounts. Nor do they challenge the authority ofthe Commission to direct expenditures ofdeferral account funds for broadband expansion or enhanced accessibility, or the various other service initiatives for which they have applied for and obtained permission from the Commission to make draw­ downs from the deferral accounts.

3. The appellants' real complaint is with the manner in which the Commission directed the disposition ofthe remaining deferral account funds. This is not a matter ofjurisdiction, but a matter within the Commission's discretion. The Commission's decision is therefore reviewable only on a reasonableness standard. None ofthe arguments put forward by the appellants presents a basis on which to find the Commission's decision was beyond the range ofreasonable outcomes. The Commission's decision was, at a minimum, reasonable for at least four reasons. Even ifthe standard ofreview is correctness, these same reasons render it correct.

4. First, the Commission required the establishment ofthe deferral accounts, and later directed the disposition ofthose funds, in the exercise ofits broad mandate under the. Telecommunications Act to determine just and reasonable rates. Parliament has expressly - 2-

provided that in detennining just and reasonable rates, the Commission may adopt "any method or technique that it considers appropriate", is entitled to impose "any conditions on a carrier's offering and provision ofany telecommunications service" and may require a carrier to "adopt any accounting method or system ofaccounts for the purposes ofthe administration ofthe Act." Under this broad mandate, the Commission was authorized to not only establish the "method" of the deferral accounts, but direct their disposition in a manner it considers appropriate and with a view to implementing the telecommunications policy objectives set out in the Act. This is exactly what the Commission did.

5. Secon9' the rebate aspect ofthe Deferral Accounts Decision did not engag~ the principle against retrospectivity. This aspect ofthe decision is entirely prospective. The Commission did not purport to revisit a prior order. Rather, in directing the disposition of the funds in the deferral accounts, the Commission proceeded on the basis that the rates that generated the deferral . accounts were not only just and reasonable at the time they were made final but remained just and reasonable.

6. Third, an order directing carriers to rebate remaining funds in their accounts is not a confiscation ofthe carriers' property, as argued by TELUS. The Commission was entitled to establish the deferral account as a contingent obligation on incumbent carriers. The carriers were aware that they were not entitled to unfettered use offunds in the deferral accounts and knew from the outset that these funds could only be used for initiatives approved by the Commission, including possible subscriber rebates.

7. Fourth, neither the Commission nor the Federal Court ofAppeal treated section 7 ofthe Act, the provision which sets out the cluster ofCanadian telecommunications objectives that Parliament has authorized the Commission to consider and balance in all that it does, as a "power-conferring" provision. The reasons ofthe Commission and ofthe Federal Court of Appeal show that they properly treated section 7 as what it is - a statement ofobj ectives for considerations in exercising the Commission's powers - and not itself a grant ofpower.

8. This appeal should therefore be dismissed. - 3 -

The Commission's regulatory and rate-setting powers

9. Parliament has given the Commission, through the Telecommunications Act, a broad · mandate to regulate the offering and provision oftelecommunications services in Canada, and to ensure that the rates for those services are just and reasonable.

10. Section 47 ofthe Act requires the Commission to exercise all ofits powers, including its rate-making authority, with a view to implementing the Canadian telecommunications policy objectives that section 7 ofthe Act sets out. These objectives include:

• to facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions;

• to render reliable and affordable telecommunication services ofhigh quality accessible to in both urban and rural areas in all regions ofCanada;

• to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;

• to foster increased reliance on market forces for the provision oftelecommunications services and to ensure that regulation, where required, is efficient and effective;

• to encourage innovation in the provision oftelecommunications services; and

• to respond to the economic and social requirements ofusers oftelecommunications services.

Telecommunications Act, S.C. 1993, c. 38, ss. 7, 47

11. Part III ofthe Act gives the Commission broad rate-setting powers. Section 24 provides, among other things, that "[t]he offering and provision ofany telecommunications service by a Canadian carrier are subject to any conditions imposed by the Commission." Section 27(1) provides that all rates charged by a Canadian carrier must be just andreasonable. The Act then confers on the Commission wide latitude in setting just and reasonable rates.

• Section 25(1) prohibits any carrier from providing a telecommunications service except in accordance with a rate approved by the Commission. - 4 -

• Section 27(3) authorizes the Commission to "detennine in any case, as a question offact, whether a Canadian carrier has complied with" this requirement (and the further requirement in s. 27(2) that carriers not unjustly discriminate or give an undue or unreasonable preference).

• Section 27(5) states that in detennining whether rates are just and reasonable, the Commission "may adopt any method or technique it considers appropriate, whether based on a carrier's return on its rate base or oth~rwise."

• Section 32(c)-ifJ gives the Commission broad authority to amend, suspend, disallow or substitute tariffs filed by a Canadian carrier.

• Section 32(g) authonzes the Commission, for the purposes ofPart III, and in the absence ofany applicable provisions in Part III, "to determine any matter and make any order relating to the rates, tariffs or telecommunications services ofCanadian carriers."

Telecommunications Act, ss. 24, 25(1),27(1),(2), (3), (5), 32(c)-(g)

12. The Act expressly authorizes the Commission to require that incumbent local exchange earners like Bell and TELUS (sometimes called "ILEes") adopt "any accounting method or system ofaccounts for the purposes ofadministration of[theJAct."

Telecommunications Act, s. 37(1)(a)

13. The Act gives the Commission the right to be heard at any stage ofan appeal from one of its decisions under the Act. Appeals are pennissible only on questions ofIaw orjurisdiction. The determination ofthe Commission on a question offact is binding and conclusive. No costs may be awarded against the Commission.

Telecommunications Act, ss. 52(1), 64(1), (5), (6)

Determining just and reasonable rates

14. ill paragraphs 50 to 54 ofits factum, TELUS discusses the concept ofjust and reasonable rates as ifthe Commission were limited to the traditional approach offixing a fair return to the carrier on its rate base. This discussion ignores the fact that, even under the traditional approach, - 5 -

the fixing oftariffs that are just and reasonable necessarily involves the regulation ofthe revenues ofthe regulated entity.

Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission), [1989] 1 S.C.R. 1722 at 1747, Book ofAuthorities ofthe Appellant Bell Canada ("Bell's Authorities"), Volume I, Tab 4, p. 152 .

15. But even more importantly, and as poillted out above, through section 27(5) ofthe Telecommunications Act Parliament has expressly authorized the Commission, in determining whether rates are just and reasonable, to "adopt any method or technique that it considers appropriate, whether based on a carrier's return on its rate base or otherwise." There was no counterpart provision in the Railway Act (the statute governing telecommunications rates at the time ofthis Court's 1989 Bell Canada decision, on which the appellants here heavily rely).

16. The Telecommunications Act replaced the Railway Act in 1993. According to a background paper issued by the department that sponsored the new Act, the legislation was specifically intended to give the Commission more flexibility in determining rates. Referring in part to what became section 27(5), the document stated:

[T]he legislation modernizes and clarifies the CRTC's powers respecting determination ofrates in such a way as to give the CRTC more flexibility in this regard. A new provision even clearly authorizes the CRTC to choose the method it deems most appropriate for establishing the rates ofthe carriers it regulates, including the current method, which is based on the carrier's rate ofreturn on its rate base. Alternatively, the CRTC will be able to use price cap regulation, or even adopt social contracts.

Communications Canada, Telecommunications: New Legislation for Canada (February 1992), pp. 23-24, Book ofAuthorities ofthe Respondent Canadian Radio-television and Telecommunications Commission ("CRTC's Authorities"), Tab 2, pp. 22-23

17. This authorization in section 27(5), coupled with the Commission's mandate from Parliament to exercise its rate-making authority with a view to implementing the Canadian telecommunications policy objectives, distinguishes the Commission's current rate-making authority from the more limited authority that was given to it in the past, was often given to other - 6-

regulators, and is still exercised by some regulators today. This more limited authority entailed and entails determining a just and reasonable rate based on a fair return to the carrier on its rate base. It was in this regulatory context that the 1989 Bell Canada case was decided and the principles ofeconomic regulation on which TELUS relies were developed.

18. As the Court ofAppeal observed,

the CRTC's rating jurisdiction is not limited to considerations that have traditionally been considered relevant to ensuring fair price for consumers and a fair rate ofreturn to the provider of telecommunication services. Section 47 ofthe Telecommunications Act expressly requires the CRTC to consider, as well, the policy objectives listed in section 7 ofthe Telecommunications Act. What that means ... is that in rating decisions under the Telecommunications Act, the CRTC is entitled to consider any or all ofthe policy objectives listed in section 7.

Reasonsfor Judgment ofthe Federal Court ofAppeal dated March 7,2008 ("Reasons ofthe Federal Court ofAppear') at para. 35, Joint Appellants' Record ("Appellants' Record"), Volume I, p. 69

19. In a series ofdecisions beginning in 1994, the Commission specifically decided to move away from return on rate base regulation. It noted that the then-new Telecommunications Act had provided "the tools necessary to allow the Commission to alt,er the traditional manner in which it regulates (i.e. to depart from rate base rate ofreturn regulation)." It instituted instead a regulatory approach based on price regulation rather than earnings regulation, one that saw enhanced competition as a benefit to all users oftelecommunications. The new approach was aimed at fulfilling the Commission's new mandate ofimplementing the Canadian telecommunications policy objectives (set out for the first time in section 7 ofthe Act), which included balancing the interests ofsubscribers, ILECs and competitors.

Review ofregulatoryframework, Telecom Decision CRTC 94-19 at 4-6, 10-12, CRTC's Authorities, Tab 3, pp. 27-29, 33-35,

Deferral accounts - genesis and rationale

20. The deferral accounts mechanism was created as an integral part ofthe Commission's methodology for determining just and reasonable rates for ILECs like Bell and TELUS. The descriptions ofthe genesis'ofthe deferral accoUIits at paragraphs 8-21 ofBell's factum and - 7 -

paragraphs 19-25 ofTELUS' factum are generally accurate as far as they go, but do not fully reflect the underlying rationale for the accounts or the function that they served in the­ Commission's regulation ofrates.

21. In its Price Caps Decision, the Commission fixed, through the mechanism ofa price cap that took into account both productivity improvements and inflation, rates for residential services that it considered would ordinarily bejust and reasonable. However, the "pure" application of the price cap would have produced rates thatwere "too low" - and thus not just and reasonable ­ in periods when the incumbent companies achieved productivity improvements that were not fully offset by inflation. The rates would have been "too low" frQm the Commission's perspective because they would not have created enough ofan incentive for competitors to enter the market, in the longer-run interest ofsubscribers. They would thus not have fulfilled the .balance ofCanadian telecommunications objectives that the Commission intended. On the other hand, the Commission did not consider it just and reasonable that the incumbent carriers have unfettered use ofthe revenues that would be generated ifthey were permitted to charge higher rates. The Commission considered that this too would not reflect an appropriate balance of Canadian telecommunications objectives.

Regulatoryframeworkfor secondprice cap period, Telecom Decision CRTC 2002-34 ("Price Caps Decision") at paras. 1-12, 99,255-257,372-377,402-413, Bell's Authorities, Volume III, Tab 18, pp. 65-66, 76, 95,107-109, 111-113 Price capframework/or large incumbent local exchange carriers, Telecom Decision eRTC 2007-27 at para. 2, Bell's Authorities, Volume IT, Tab 16, p. 7 Reasons ofthe Federal Court ofAppeal at para. 10, Appellants' Record, Volume I, pp. 58-59

22. As TELUS acknowledges in its factum, deferral accounts are a common regulatory technique. In this case, the deferral accounts were a technique for ensuring that - taking into account the Canadian telecommunications policy objectives that Parliament mandated the Commission to implement - rates were just and reasonable at the time the rates were charged, from the perspective ofboth the amount paid by the subscribers and the amount received by the ILEe. The Commission "considered that the creation ofa deferral account ... would assist in achieving the price cap objective ofbalancing the interests ofcustomers, competitors and ILECs - 8 -

- the three main stakeholders in telecommunications markets." It described the accounts as "an integral part ofthe Commission's framework for ensuring that rates charged by Canadian carriers for telecommunications services are just and reasonable."

Disposition offunds in the deferral accounts, Telecom Decision CRTC 2006-9 ("Deferral Accounts Decision") at paras. 3-5, 49, . Appellants' Record, Volume I, pp. 7, 12

23. The Commission stated that it would review the amount in each ILEC's deferral account on an annual basis, no later than the second year ofthe price cap period, at the time ofthe ILEC's annual price cap filings. At that time, it would order the disposition ofthe amounts that had accrued in the deferral accounts during the previous year. The Commission stated that it would clear the funds in the deferral accounts in a manner that contributed to achieving the objectives ofth~ then-current price cap period, including balancing the interests ofthe three main stakeholders. The Commission made it clear in its decision that funds would be cleared and used for various purposes, including, but not limited to, possible subscriber rebates.

Price Caps Decision at paras. 404-413, Bell's Authorities, Volume III, Tab 18, pp. 112-113

24. Neither Bell nor TELUS nor anyone else sought to appeal the Price Caps Decision.

Reasons ofthe Federal Court ofAppeal at para. 14, Appellants' Record, Volume I, p. 60

25. As noted in paragraph 27 ofTELUS' factum, following the Price Caps Decision and prior to the Deferral Account Decision, ILECs - including TELUS - applied to the Commission for, and received, permission to draw down the deferral account funds for various service initiatives, including local and wireless number portability and service improvement plans in specified communities.

Telus Communications Inc. - Application to increase the capital costs ofits service improvement plan and related matters, Telecom Decision CRTC 2004-76 at paras. 9, 10, 15, CRTC's Authorities, Tab 5, pp. 124-126 Follow-up to Decision 2002-43 -Societe en Commandite TeIebec's request to recover the start-up costsfor local competition and local number portability, Telecom Decision ~ 9 -

CRTC 2005-76 at paras. 9, 19,26,28, CRTC's Authorities, Tab 6, pp. 127-128, 130-131

Final rates were subject to the price caps/deferral accounts regime

26. When the Commission made Bell's and TELUS' rates for the period in question here final, it did so subject to each incumbent carrier's continued maintenance ofits deferral account· For example, in the same decision in which it rendered Bell's rates final, it directed Bell to allocate funds to its deferral account. Bell continued following the decision to credit funds to this account. Similarly, when the Commission made TELUS' rates for the period in ,question final, it expressly did so in accordance with the price regulation regime that it had established in the Price Caps Decision. This regime included the condition that TELUS maintain a deferral account for later disposition.

Be'll Canada 2002 Annual Price cap filing, Telecom Decision CRTC 2003-15 at para. 65, Bell's Authorities, Volume Ill, Tab 19, . p.244 TEL US Communications Inc., 2002 Annualprice cap filing, Telecom Decision CRTC 2003-18 at paras. 1,30, Book of Authorities ofTELUS Communications Inc. ("TELUS' Authorities"), Tab 37, pp. 1,5-6 Reasons ofthe Federal Court ofAppeal, paras. 15-16, Appellants' Record, Volume I, p. 60 .

The Deferral Accounts Decision

27. As it had said it would do in the Price Caps Decision, the Commission invited proposals for disposing ofthe amounts accumulated in the deferral accounts during the first two years of the price cap period (and that had not been drawn down for approved service initiatives as described in paragraph 25 above). Parties were required to use the objectives identified in the Price Caps Decision as a guide in preparing their proposals.

Deferral Accounts Decision at para. 8, Appellants' Record, Volume I, p. 8

28. The Commission received numerous proposals for disposition ofthe funds, including proposals from Bell and TELUS. A variety ofuses for the funds were proposed, including - 10-

broadband service expansion, improving accessibility, price reductions and network improvements.

Deferral Accounts Decision at para. 14, Appellants' Record, Volume I, p. 8

29. Bell's and TELUS' proposals focused on the expansion ofbroadband services. Bell opposed the allocation ofdeferral account funds to customer rebates on the basis that rebates would be difficult to administer and would be misunderstood by customers as a significant rate reduction. It did not argue that customer rebates would retroactively amend final rates, though some other ILECs did make this argument. TELUS also opposed the allocation offunds to customer rebates.

Deferral Accounts Decision at paras. 63-66-67; 105-107, Appellants' Record, Volume I, pp. 14, 18

30. The Commission determined that expanding broadband service and improving accessibility to telecommunications services would be appropriate uses for deferral account funds. Disposing offunds for these purposes would further the objectives set out in the Price Caps Decision and section 7 ofthe Act.

Deferral Accounts Decision at paras. 73-80, 97, 100, 116, 210-211, Appellants' Record, Volume I, pp. 15-16,18-20,31

31. The Commission also determined that using funds in the deferral accounts for customer rebates would be consistent with section 7 ofthe Act and the objectives set out in the Price Caps Decision. It found that providing a one-time rebate to customers would not be equivalent to lowering the JLECs' rates. However, it considered that it would be overly complex and not cost­ effective to try to estimate rebate amounts proportionate to the amounts contributed by individual subscribers to the deferral accounts, and that the cost oftrying to locate former subscribers to pay them rebates would outweigh the benefits.

Deferral AccountsDecision at paras. 112-114, Appellants' Record, Volume I, p. 19

32. The Commission concluded that, to the greatest extent possible, ILECs should use the funds in their deferral accounts to fund initiatives, to be approved by the Commission, for - 11 -

broadband expansion and improved accessibility for persons with disabilities. It determined that any balance remaining in a deferral account once funding was used for approved initiatives should be rebated to subscribers. The subscriber rebate would in these circumstances be consistent with section 7 ofthe Telecommunications Act and the objectives set out in the Price Caps Decision.

DeferralAccounts Decision at para. 112, 116, Appellants' Record, Volume I, pp. 19-20 Reasons ofthe Federal Court ofAppeal at paras. 53-54, Appellants' Record, Volume I, pp. 75-76

33. Nowhere in the Deferral Accounts Decision did the Commission conclude that the rates in issue here were not just and reasonable at the time they were charged, or decide that those rates should be changed. Indeed, in the decision the Commission reviewed and reiterated the reasons why it considered those rates to be appropriate.

Deferral Accounts Decision at paras. 1-7, Appellants' Record, Volume I, pp. 7-8

Implementation of the Deferral Accounts Decision

34. Following the Deferral Accounts Decision the Commission issued two further de~isions towards its implementation. The first decision approved certain broadband expansion projects as to which there was no dispute. The second, Telecom Decision CRTC 2008-1, approved the spending ofdeferral account funds on certain other broadband expansion initiatives and certain accessibility initiatives, and directed the ILECs to submit proposals to rebate the remaining funds in the accounts to residential subscribers ofrecord as ofthe date ofthe decision, January 17, 2008.

Use ofdeferral accountfunds to improve access to telecommunications servicesfor persons with disabilities and to expand broadband services to rural and remote communities, Telecom Decision CRTC 2008-1 at paras. 112-114, Bell's Authorities, Volume III, Tab 22, p. 293

35. Since Telecom Decision CRTC 2008-1 has been stayed (except as it relates to initiatives to improve access to telecommunications for persons with disabilities) pending the proceedings in this Court, the ILECs have not yet submitted proposals and the Commission has not yet - 12 -

determined how the funds are to be credited to these subscribers. As the Court ofAppeal observed, the possibilities include a one-time credit and a reduction in the rates payable by these subscribers for some future period.

Order staying Telecom Decision CRTC 2008-1, Appellants' Record, Volume I, p. 124 Reasons ofthe Federal Court ofAppeal at para. 23, Appellants' Record, Volume I, p. 64

Decision of the Federal Court ofAppeal

36. As the Federal Court ofAppeal noted in its reasons, there was before it "no dispute that the CRTC is entitled to use the device ofa mandatory deferral account to impose a contingent obligation on a telecommunication service provider to make expenditures that the CRIC may direct in the future."

Reasons ofthe Federal Court ofAppeal at para. 52, Appellants' Record, Volume I, p. 75

37. Bell and TELUS also conceded during the argument ofthe appeal that the Commission had jurisdiction to direct that the ILECs use a portion ofthe funds in their deferral accounts to improve accessibility to telecommunications services for persons with disabilities.

Reasons ofthe Federal Court ofAppeal at para. 27, Appellants' Record, Volume I, p. 66

38. In dismissing the two appeals, the Court ofAppeal found that in practical terms, the· balance in an ILEC's deferral account could be regarded as "representing the amount ofa contingent obligation ofthe ILEC to use a certain portion ofthe rates collected from residential local subscribers in non-high cost serving areas in the manner that the CRTC would direct." It found that

there is no overpayment in fact or in law. The ILECs acted lawfully in charging and collecting the rates permitted by the CRTC. However, but for the need, perceived by the CRTC, to encourage competitors to enter the market for residential local subscribers in non-high cost service areas, the permitted rate would have been lower. - 13 -

Reasons ofthe Federal Court ofAppeal at para. 21, Appellants' Record, Volume I, p. 63

39. In considering the rebates directed by the Commission after the deferral account funds had been used for approved broadband expansion and accessibility projects, the Court observed that while "rebate" nonnally means a refund or repayment ofmoney to the person who paid it, the word was used in the Deferral Account Decision in a slightly different sense, "to connote a method, yet to be detennined, whereby the amount to be 'rebated' is used to benefit the relevant class ofsubscribers as it is constituted on some [specified] date." It pointed out that, for example, a "rebate" might be made by a one-time credit or a reduction in the rates payable by those subscribers for some future period. As mentioned in paragraph 34 above, the Commission detennined that the rebates would be made to subscribers ofrecord as ofJanuary 17,2008.

Reasons ofthe Federal Court ofAppeal at para. 23, Appellants' Record, Volume I, p. 64

40. The Court applied the correctness standard ofreview in detennining the scope ofthe Commission's authority. However, it suggested that the case might not be distinguishable from this Court's 2007 decision in Council ofCanadians with Disabilities v. Via Rail Canada In,c., in which this Court held that r,easonableness was the appropriate standard ofreview. The Court of Appeal's decision also pre-dated this Court's decision in Dunsmuir.

Reasons ofthe Federal Court ofAppeal at paras. 28-29, Appellants' Record, Volume I, pp. 66-67

41. The Court held that the Commission's rate-setting jurisdiction under the Telecommunications Act is not limited to considerations that have traditionally been considered relevant to ensuring a fair price for consumers and a fair return to the provider of telecommunication services. It noted that section 47 ofthe Act expressly requires the Commission to consider, as well, the policy objectives listed in section 7. This made relevant a broader range ofconsiderations.

Reasons ofthe Federal Court ofAppeal at paras. 35-41, Appellants' Record, Volume I, pp. 69-71 - 14-

42. Nothing in the Court ofAppeal's reasons for dismissing the appeals suggests that it treated sections 7 and 47 as sources ofjurisdiction. Rather, the Court referred to these provisions as prescribing factors ~at the Commission is entitled - and mandated - to consider in exercising its jurisdiction.

Reasons ofthe Federal Court ofAppeal at paras. 35-36,41, Appellants' Record, Volume I, pp. 69, 71

43. In dealing with the arguments in Bell's appeal that the Commission had engaged in impermissible retrospective rate regulation, the Court ofAppeal disting~ished the circumstances before it from those in this Court's 1989 Bell Canada decision, on which Bell heavily relied and both appel1ants rely again here. It noted, quoting this Court's decision, that in the 1989 case the Commission had found that rates that it had fixed for the earlier period were not in fact just and reasonable, and had ordered a credit to remedy the situation. Its decision to change those rates was therefore retrospective. Here, "by contrast, the rates in issue were determined to be just and reasonable when they were initially set, and the Commission has never determined otherwise. Those rates were subject to the Price Caps Decision and the deferral accounts. The Commission was entitied to direct the manner in which the funds in the accounts would be used, and, as the Commission found, using them for subscriber rebates was consistent with the Canadian telecommunications policy objectives set out in s. 7 ofthe Telecommunications Act.

Reasons ofthe Federal Court ofAppeal at paras. 49-55, Appellants' Record, Volume I, pp. 74-76

44. The Court therefore found that "[t]he su;bscriber rebate in this case did not, in intent or in effect, reduce retrospectively any rates that had been determined to be just and reasonable. It was ... entirely prospective."

Reasons ofthe Federal Court ofAppeal at para. 55, Appellants' Record, Volume I, p. 76

Limits ofthe appeJlants' arguments

45. In their factums, Bell and TELUS do not challenge the authority ofthe Commission to require the establishment ofdeferral accounts. Nor do they challenge the authority ofthe Commission to direct expenditures ofdeferral account funds for broadband expansion or - 15 -.

enhanced accessibility or other service initiatives for which they applied for draw-downs from the deferral accounts. The appellants accept the Commission's directions that they spend the funds for these purposes. Indeed, they have sought from the Commission directions that the funds be used for broadband expansion, as well as for other service initiatives.

PART II - QUESTIONS IN ISSUE

46. The issues in this appeal from the Commission's perspective, and the Commission's position on these issues are as follows:

(1) What is the applicable standard ofreview on the matters in issue in this appeal?

As noted above, the appellants do not take issue with the Commission's jurisdiction to establish the deferral accounts. By accepting that the Commission may direct expenditures be made towards broadband expansion and accessibility initiatives, the appellants also agree that the Commission hasjurisdiction to order the disposition ofthose accounts. The crux ofthe appellants' complaint is therefore with the manner in which the Commission exercised its discretion in ordering the disposition ofthe remainingfunds. This decision is subject to review on the standard ofreasonableness.

(2) Have the appellants shown any proper basis for the Court to interfere with the Commission's order directing that Bell and TELUS dispose ofany funds in their deferral accounts not approved for broadband expansion or improved accessibility initiatives through rebates to consumers?

No. The Commission's decision cannot be regardedas unreasonable. In the alternative, the Commission correctly determined that it hadjurisdiction to dispose ofthefunds that accumulated in the deferral accounts andproperly exercised its jurisdiction in this case.

PART III - STATEMENT OF ARGUMENT

Reasonableness is the appropriate standard of review

47. Applying the factors recently set out by this Court in Dunsmuir, the appropriate standard ofreview in this case is reasonableness. The specialized expertise ofthe Commission, the nature - 16 -

ofthe question and the existing jurisprudence lead to the conclusion that the Commission's decision should be approached with respectful deference.

48. The Commission has specialized expertise. This Court has held that the proper concern ofthe reviewing court is not the expertise ofthe decision-maker in general, but its expertise relative to that ofthe court vis-a-vis the particular issue. In detennining the standard ofreview of a decision involving interpretation and application ofa statute, the focus ofthe inquiry is on the specific provision that the tribunal invoked and applied. Some provisions within the same Act may require greater curial deference than others. This Court has also repeatedly recognized the Commission as "a specialized administrative tribunal ... which possesses considerable expertise over" matters that fall squarely within its jurisdiction.

Barrie Public Utilities v. Canadian Cable Television Assn., [2003] 1 S.c.R. 476, 2003 SCC 28 at paras. 12-13, Bell's Authorities, Volume I, Tab 2, pp. 63-64

49. This case involves a decision made by the Commission in the exercise ofits rate-making authority. The decision engaged the Commission's authority under section 27(1) ofthe Act - the provision that requires, among other things, that all rates charged by a carrier be just and reasonable - and the other provisions that infonn and facilitate the Commission's ability to carry out its mandate ofdetenniningjust and reasonable rates - sections 7, 27(5), 37(1)(a), and 47.

50. The detennination ofjust and reasonable rates lies at the very core ofthe Commission's expertise, experience and policy-making role. Parliament has given the Commission a broad mandate to detennine just and reasonable rates. It is entitled to impose "any conditions" on a carrier's offering and provision ofany telecommunication services. It is also entitled to "adopt any method or technique that it considers appropriate" in setting just and reasonable rates. It may, in addition, require a Canadian carrier to "adopt any accounting method or system of accounts for the purposes ofadministration ofthe Act." This broad mandate demonstrates Parliament's intention to leave to the Commission, as an expert tribunal, the resolution ofthe interpretive questions bound up in detennining just and reasonable rates. This is a case where "the broad policy context ofa specialized agency infuses the exercise ofstatutory interpretation such that application ofthe enabling statute is no longer a matter of 'pure statutory interpretation'." - 17 -

Telecommunications Act, ss. 24, 27(1), 27(5), 32(c)-(g) AIlstream Corp. v. Bell Canada, 2005 FCA 247 at paras. 27-30, . CRTC's Authorities, Tab 1, pp. 18-19 Council ofCanadians with Disabilities v. VIA Rail Canada Inc., [2007] 1 S.C.R. 650, 2007 SCC 15 at paras. 92-93, Bell's Authorities, Volume I, Tab 7, pp. 267-268

51. The much greater relative expertise ofthe Commission on the matters at issue in this case calls for a high level ofdeference.

52. Nature ofthe question. This factor also militates in favour ofdeference. The question decided by the Commission was discretionary and polycentric, rather than truly jurisdictional.

53. There is no dispute that the Commission had the power to direct the disposition ofthe funds in the deferral account funds. Bell and TELUS each admit in their factums in this appeal (see paragraph 18 ofBell's factum and paragraph 78 ofTELDS' factum), and acknowledged in the Federal Court ofAppeal, that the Commission had jurisdiction to direct that ILECs use funds in their deferral accounts for initiatives to improve accessibility to telecommunications services for persons with disabilities. The appellants also acknowledged - through their actions - that the Commission had jurisdiction to order that deferral account funds be used for broadband expansion; they both specifically sought orders from the Commission to this effect. They also sought permission from the Commission, prior to the Deferral Accounts Decision, to make draw­ downs from the deferral account for other service initiatives. There is thus no true question of jurisdiction as defined in Dunsmuir - "in the narrow sense ofwhether or not the [Commission] .had the authority to make the inquiry."

Dunsmuir v. New Brunswick, 2008 SCC 9 at para. 59, Bell's Authorities, Volume II, Tab 9, p. 45

54. Rather, the issue in dispute is the manner in which the Commission directed the funds that were not approved for broadband expansion and accessibility initiatives should be spent. This is not a question ofjurisdiction as the appellants submit, but one ofdiscretion. As this Court has often stated, courts "should not be alert to brand as jurisdictional, and therefore subject to broader curial review, that which may be doubtfully so." - 18 -

Dunsmuir v. New Brunswick at para. 59, Bell's Authorities, Volume II, Tab 9, p. 45

. 55. This caution is particularly relevant here, when Parliament has determined that the Commission's determination as to whether a telecommunications service provider's rates are just and reasonable is a non-appealable determination offact.

Telecommunications Act, ss. 27(3), 52(1), 64(1)

56. The determination ofjust and reasonable rates - ofwhich the establishment, administration and disposition ofthe deferral accounts was one facet - is a polycentric exercise. The Commission is called upon to balance the interests ofILECs, competitors and customers in setting rates that are just and reasonable. In balancing these interests, and deciding whether a rate is just and reasonable, the Cominission must have regard to the policy objectives mandated under section 7 ofthe Act. This involves the weighing ofa large number of interlocking and interacting interests and considerations. In these circumstances, the Federal Court ofAppeal has held that courts should show restraint when reviewing Commission decisions.

Telecommunications Act, ss. 27(1), 27(5), 32(g), 47 Allstream Corp. v. Bell Canada at paras. 26-30, CRTC's Authorities, Tab 1, pp. 18-19 MTS Allstream Inc. v. Edmonton (City), 2007 FCA 106 at para. 44, 73, B~ll's Authorities, Volume II, Tab 11, pp. 226, 231

57. Existingjurisprudence. In Allstream Corp. v. Bell Canada, and later reiterated in MTS Allstream Inc. v. Edmonton (City), the Federal Court ofAppeal determined that the applicable standard ofreview ofa decision ofthe Commission in the exercise ofits rate-making authority is . patent unreasonableness (reasonableness after Dunsmuir). This is the category ofquestion before the Court in this appeal.

Allstream v. Bell Canada at para. 31, CRTC's Authorities, Tab 1, p. 19 MTS Allstream Inc. v. Edmonton (City) at para. 73, Bell's Authorities, Volume II, Tab 11, p. 231 Dunsmuir v. New Brunswick at para. 54, Bell's Authorities, Volume II, Tab 9, p. 42 . 19 -

58. None ofthe cases on which the appellants rely (in paragraphs 31-36 ofBell's factum and paragraphs 44-49 ofTELUS , factum) involves a question ofthe nature at issue on this appeal. These cases therefore do not assist in detennining the standard ofreview here.

• The issue in ATCa Gas & Pipelines Ltd. v. (Energy & Utilities Board) was whether a regulator, authorized to fix a utility's rates based on return on rate base, had jurisdiction to allocate to ratepayers a portion ofthe proceed~ ofthe sale ofassets in which the utility had invested. The allocation was not in furtherance ofthe regulator's overall protective role ofensuring that rates are just and reasonable.

• The issue in the 1989 Bell Canada decision was the power ofthe Commission to "revisit" interim rates following a factual finding that these rates were not just and reasonable at the time they were established and to subsequently order a one-time credit to remedy this situation. • While the Barrie Public Utilities case also involved a decision ofthe Commission under theTelecommunications Act, the decision was one interpreting an expression found in section 43(5) ofthe Act - "the supporting structure ofa transmission line" - that this Court held had no technical meaning, and whose interpretation was not a polycentric question and did not engage the Commission's relative expertise. The provisions at issue here, by contrast, are bound up in the determination ofjust and reasonable rates, a function at the core ofthe Commission's expertise.

• MTS Allstream Inc. v. City ofEdmonton also dealt with the interpretation ofsection 43 of the Act, and as expressly stated in that decision, did not involve issues pertaining to Commission's exercise ofits rate-making authority.

• Telephone Co. v. Shaw Cablesystems (B. C) Limited involved a conflict between a Commission decision and a decision ofanother administrative tribunal, a federal labour arbitration board.

ATca Gas & Pipelines Ltd. v. Alberta (Energy & Utilities Board), [2006] 1 S.C.R. 140,2006 SCC 4, Bell's Authorities, Volume I, Tab 1, TELUS' Authorities, Tab 7 Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission), [1989] 1 S.C.R. 1722, Bell's Authorities, Volume I, Tab 4, TELUS' Authorities, Tab 11 - 20-

Barrie Public Utilities v. Canadian Cable Television Assn., [2003] 1 S.c.R. 476, 2003 SCC 28, Bell's Authorities, Volume I, Tab 2, TELUS' Authorities, Tab 9 MTS Allstream Inc. v. Edmonton (City), Bell's Authorities, Volume II, Tab 11 British Columbia Telephone Co. v. Shaw Cablesystems (B.C.) Ltd., [1995] 2 S.C.R. 739, Bell's Authorities, Volume I, Tab 5

59. While the Commission may not have provided detailed reasons setting out its view ofits authority, this is not a barrier to applying the reasonableness standard. As the Court stated at paragraphs 48-49 ofDunsmuir, and as TELUS acknowledges in its factum at paragraph 77, respectful deference in the context ofthe reasonableness standard implies that courts will give due consideration to the detenninations ofdecision makers, including attention to the reasons that either were offered or could be offered in support ofdecision.

Dunsmuir v. New Brunswick at paras. 48-49, Bell's Authorities, Volume II, Tab 9, pp. 40-41

60. The Dunsmuir factors therefore lead to the conclusion that Court must not interfere with the Commission's decision unless it is unreasonable; that is, unless it is outside the range of possible, acceptable outcomes.

Dunsmuir v. New Brunswick at paras. 47, Bell'sAuthorities, Volume II, Tab 9, pp. 39-40

No basis for interference with the decision

61. In this case, the Commission, applying its expertise, determined that customer rebates were an appropriate means ofdisposing ofany remaining funds in ILEC deferral accounts once funds had been used towards broadband expansion and accessibility initiatives. In reaching its decision regarding the disposition ofthe deferral account funds, the Commission heard from a number ofdifferent stakeholders, considered various factors and determined that it would be consistent with the policy objectives in section 7 to direct that funds be put towards customer rebates. 1 - 21 - I 62. There was nothing unreasonable about this decision. In the alternative, it was correct. None ofthe reasons that the appellants put forward provides a basis for interfering with the I decision.

63. First, the Commission had broad authority under its legislative mandate to require the I establishment ofthe deferral accounts and to direct their subsequent disposition in a manner I consistent with the objectives ofthe Act. Second, the rebate aspect ofthe Deferral Accounts Decision does not purport to revisit a prior order, or otherwise interfere with an ILECs past revenues. The rebates are prospective in both purpose and effect. Third, ordering that ILECs dispose ofthe funds through rebates does not constitute a "confiscation" ofILECs' property. Fourth, the Commission and the Court ofAppeal properly applied section 7 ofthe Act.

Principles ofstatutory interpretation

64. As this Court has repeatedly stated, the principles ofstatutory interpretation require that the words ofan Act must be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme ofthe Act, the object ofthe Act and the intention of Parliament.

ATeo Gas & Pipelines Ltd. v. Alberta (Energy and Utilities Board), [2006] 1 S.C.R. 140 at para. 37, Bell's Authorities, Volume I, Tab 1, pp. 14-15

65. Administrative tribunals may obtain their jurisdiction either from express grants ofpower under the governing statute, or by necessary implication from the powers expressly given.

ATCO Gas & Pipelines Ltd. v. Alberta (Energy and Utilities Board) at para. 38, Bell's Authorities, Volume I, Tab 1, p. 15

66. Under the doctrine ofjurisdiction by necessary implication, the powers conferred by an enabling statute are construed to include not only those expressly granted but also, by implication, all powers that are practically necessary for the accomplishment ofthe objectives of the legislation. The doctrine ensures that administrative bodies have the necessaryjurisdiction to accomplish their statutory mandate. When legislation attempts to create a comprehensive regulatory framework, the tribunal must have the powers which by practical necessity and necessary implication flow from the regulatory authority explicitly conferred upon it. - 22-

A TCO Gas & Pipelines Ltd. v. Alberta (Energy and Utilities Board) at paras. 50-51, Bell's Authorities, Volume I, Tab 1, p. 18

67. As this Court cautioned in Bell Canada v. Canada, "although courts must refrain from unduly broadening the powers ofsuch regulatory authorities through judicial law-making, they must also avoid sterilizing these powers through overly technical interpretations ofenabling statutes."

Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission) at 1756, Bell's Authorities, Volume I, Tab 1,p.161

The Commission hadjurisdiction to require the establishment ofdeferral accounts

68. The Commission required ILECs to establish deferral accounts as an integral part ofthe Price Cap regime, to ensure that rates are just and reasonable.

69. A reading ofthe Act, consistent with the principles ofstatutory interpretation described above, shows that Parliament gave the Commission the express power to require the establishment ofdeferral accounts as part ofits broad mandate to determine just and reasonable rate~. The Commission is entitled to adopt "any method or technique that it considers appropriate" in doing so. It is entitled to impose "any conditions on a carrier's offering and provision ofany telecommunications services." It may require a Canadian carrier to "adopt any accounting method or system ofaccounts for the purposes ofthe administration ofthe Act." It may make "any decision" subject to "the fulfilment ofa specified condition." This statutory language demonstrates that Parliament intended to give the Commission the flexibility to establish just and reasonable rates using any method, including the establishment and payment out ofa deferral account, for purposes consistent with the policy objectives ofthe Act. The legislative history referred to above reinforces this conclusion.

Telecommunications Act, ss. 24,27(1),27(5), 37(l)(a), 47 Allstream Corp. v. Bell Canada at paras. 26-34, CRTC's Authorities, Tab 1, pp. 18-19

70. In setting just and reasonable rates for ILECs and in regulating the effects ofthe price cap constraint on local competition, the Commission detennined that the deferral account mechanism - 23 -

was an appropriate "method or technique" to use and a proper "accounting method or system of accounts" for ILECS to adopt. Its approval ofthe ILECs' rates was subject to the condition that they maintain the deferral accounts for later disposition. These detenninations were within the express authority ofthe Commission to make. How the Act's requirement that rates be just and reasonable can best be achieved has been left entirely to the Commission's detennination.

Telecommunications Act, S8. 27(5), 37(1)(a) Ryan, Canadian Telecommunications Law andRegulation (2005+) at §612, CRTC's Authorities, Tab 4, p. 122

71. In view ofParliament's express authorization in section 27(5), there is no reason why the Commission could not adopt the establishment and disposition ofdeferral accounts as a "method or system" for detenniningjust and reasonable rates, whether or not other regulators have chosen to use these accounts in this manner.

72. TELUS acknowledges in paragraph 74 ofits factum that regulators commonly use deferral accounts in regulating rates. Even if, as TELUS argues, the deferral account technique has not ordinarily been used in precisely the same way, that does not preclude the Commission . from using it as it did here. To freeze in time the manner in which the Cornrilission may deploy the regulatory tools available to it would undennine Parliament's intention that it have maximm:n flexibility in determining just and reasonable rates.

A uthority includes authority to direct disposition offunds in deferral accounts

73. The Commission's authority to require ILECs to establish deferral accounts includes the authority to direct the disposition ofthe funds with a view to implementing the telecommunications policy objectives in the Act. This authority is derived from the express provisions under the Act. In the alternative, this authority is implicit in the statute - that is, the power ofthe Commission to direct the disposition ofdeferral account funds is practically necessary to the :fulfillment ofthe purposes and objectives ofthe Act, and in particular the Commission's rate setting mandate.

74. As noted above, the Act provides the Commission with the authority to use any method or technique in detennining just and reasonable rates. The establishment ofa deferral account is . one such method or technique. Similarly, the disposition ofthe deferral account also derives - 24-

from the express statutory mandate identified in paragraph 69 above - that is, it is part ofthe "method or technique" the Commission adopted in considering just and reasonable rates.

Telecommunications Act, ss. 24, 27(1), 27(5), 37(1)(a), 47

75. Alternatively, the Commission's power to order the disposition offunds from the deferral accounts is implicitin the Act. This power flows by necessary implication from the Commission's authority to establish the deferral accounts under sections 27(5) and 37(1)(a) of the Act: it is inherent in the deferral account "method or technique" that the funds in a deferral account will at some point be paid out. The Commission's power to order the disposition ofthe deferral account funds is therefore practically necessary to achieve the purposes and objectives of the Act - including the determination ofjust and reasonable rates by any method or technique the Commission considers appropriate. The Commission's authority to require the establishment ofdeferral accounts would be oflittle regulatory value ifit was without authority to require disposition ofdeferral account funds in a manner it deems appropriate in accordance with the policies and objectives ofthe governing legislation.

. ATeO Gas & Pipelines Ltd. v. Alberta (Energy and Utilities Board) at paras. 50-51, Bell's Authorities, Volume I, Tab 1, p. 18

76. The appellants have acknowledged that the Commission has this authority. Bell and TELUS explicitly acknowledge in their factums (paragraph 18 ofBell's factum and paragraph 78 ofTELUS' factum) that the Commission had jurisdiction to order ILECs to use funds in their deferral accounts on initiatives to improve accessibility to telecommunications services for persons with disabilities. TELUS agrees at paragraph 78 ofits factum that the Commission has jurisdiction to direct the use ofdeferral account funds for broadband expansion. Bell has implicitly acknowledged this jurisdiction; it specifically sought a direction to this effect. The appellants had also earlier sought the Commission's pennission to make draw-downs from the deferral accounts for other service initiatives.

77. TELUS and Bell have thus recognized, both in the positions that they have taken and in their conduct, that the power to require the establishment ofdeferral accounts entails the power to direct the disposition ofthe funds in the accounts. Otherwise there would be no point in - 25 -

requiring the establishment ofthe accounts in the first place. As TELUS states at paragraph 78 ofits factum, "[t]he point ofdispute is not whether the CRTC may direct any expenditures."

78. There is no difference in principle between requiring use ofdeferral account funds for improving accessibility or for broadband expansion - which Bell and TELUSaccept the Commission has jurisdiction to do - and requiring their use to lower the amount that customers will pay for the telecommunication services that they receive during the billing period or period when the rebates that the Commission has directed are ultimately credited. All reflect ways of regulating the return to the carrier and requiring expenditures out ofdeferral account funds that achieve telecommunications policy objectives.

79. This Court's ATCO decision, on which the appellants, and TELUS in particular rely, does not lead to the contrary conclusion. In ATCO, the regulator had a limited, return on rate base mandate in setting rates. The issue was whether a regulator, authorized to fix a utility's rates based on return on rate base, had jurisdiction to allocate to ratepayers a portion ofthe proceeds of the sale ofassets in which the utility had invested, outside any rate-setting proceeding. The governing legislative provision only gave the regulator authority to approve the sale ofassets, and did not give the regulator authority to distribute sale proceeds to ratepayers. The regulator ordered that sale proceeds be distributed to rate payers to rectify what it perceived to be a historic-overcompensation to the utility by ratepayers. The statutory scheme in ATCO contained no provisions analogous to sections 7 and 47 ofthe Telecommunications Act, and no language authorizing the use of"any method or technique" to achieve regulatory objectives.

ATCO Gas & Pipelines Ltd. v. Alberta (Energy & Utilities Board), 2006 SCC 4 at paras. 5, 8, 62-67, Bell's Authorities, Volume I, Tab 2, pp. 8-9,20-21

80. Here, by contrast, the Commission is not limited in the methods or techniques it may employ in regulating rates. It is also mandated to pursue a wider range ofobjectives, both economic and social. In requiring the ILECs to establish and then pay funds out ofdeferral accounts, the Commission was not purporting to deal with assets in which they had invested or trying to remedy a perceived erroneous overpayment to ILEes. Rather, it was doing what this Court indicated in ATCO a regulator is to do - it was determining rates that it considered just.and reasonable in all ofthe circumstances. As noted above, the Commission had made it clear from - 26-

the outset that carriers would not have free use ofthe funds generated by the rates paid into the accounts.

81. The Commission's detennination ofhow funds in the deferral accounts were to be spent was a determination that it was entitled to make as part ofits o.uthority to require that deferral accounts be established in the first place.

The Commission's decision was entirely prospective in purpose and effect

82. As the Court ofAppeal correctly determined, the Commission's decision to dispose of certain deferral account funds through customer rebates was prospective. Contrary to the appellants' submissions, there was no uncertainty created by ordering ILECs to dispose oftheir deferral account funds through rebates. In directing the disposition ofdeferral account funds through rebates, the Commission did not review and change rates that it had finally detennined w~re just and reasonable. There was no revisiting ofa previous order in effort to remedy the imposition ofunjust orunreasonable rates. Nor did the order interfere with ILECs' revenues or constitute a "confiscation" ofan ILEC's property.

83. The Commission did not revisit aprevious order. The Commission's decision as to how deferral account· funds should now be spent entailed no determination that !LECs' rates were not just and reasonable at the time they were charged, with respect to either the amount paid by subscribers or the establishment and maintenance ofthe ILECs' deferral accounts. Those rates were and remain just and reasonable. They served the policy objectives that they were intended to serve. Rather, the Commission's decision reflects a detennination, based on the prevailing circumstances, as to how these funds should now most appropriately be spent to achieve telecommunications policy objectives. The decision is merely the next step in the implementation ofthe decision establishing the deferral account.

84. As explained above, the Commission fixed rates that it determined were just and reasonable, taking into account its assessment ofCanadian telecommunications policy objectives, as Parliament has mandated. As part ofapproving those rates it required that the ILECs establish deferral accounts and made it clear that the funds in the accounts were subject to disposition as it would later direct. This aspect ofits Tate decision was also aimed at achieving, consistent with the telecommunications policy objectives, a balancing ofthe interests of - 27 -

customers, competitors and ILECs. The Commission considered the rates just and reasonable in part for the very reason that they were subject to the condition that Bell and TELUS establish a deferral account for later disposition. When Bell's and TELUS' rates were made final, they were made final subject to each ILECs' continued maintenance ofits deferral account for later disposition.

85. As the Court ofAppeal found, the effect ofthe Commission's decision is also entirely prospective. Accessibility will be better going forward. New broadband facilities will be built. Subscribers who were subscribers as ofJanuary 17, 2008 will pay less for the telecommunication services that they receive during the billing period or period when the rebates are ultimately credited.

86. Bell and TELUS accept the validity ofthe Commission's directions to spend deferral account funds on the first two ofthese three purposes. There is no difference in principle between the first two and the third. All reflect ways ofmaking expenditures out ofdeferral account funds that achieve, prospectively, telecommunications policy objectives.

87. As the Court ofAppeal also concluded, the 1989 Bell Canada decision does not apply here. This Court's decision in the 1989 Bell Canada case described the issue before it as "the power to revisit the period during which interim rates were in force." ~ that case the Commission stated when setting interim rates that they would be subject to review, based in part on whether the assumptions they reflected about Bell's return on equity turned out to be accurate. When the Commission "revisited" the interim rates in its final decision, it found that they had generated excess revenues in light ofthe appropriate return on equity. It therefore ordered that the rates be reduced retrospectively through a rebate. Its objective was to render just and reasonable rates that had turned out not to be just and reasonable.

Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission) at 1730d-j, 1733d-1735f, 1749b, Bell's Authorities, Volume I, Tab 4, pp. 135, 138-140, 154

88. This Court summarized the position in the 1989 case as follows:

[The Commission] has examined the period during which interim rates were in force ..., for the purpose ofascertaining whether these interim rates were in fact just and reasonable. Following a - 28-

factual finding that these rates were not just and reasonable, the one-time credit order now contested before this Court was made in order to remedy this situation.

Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission) at I749c-e, Bell's Authorities, Volume I, Tab 4, p. 154

89. Here, by contrast, there was no "revisiting," and no determination that the rates during the relevant period were not just and reasonable. Instead the Commission has determined how revenues generated by those just and reasonable rates should now be deployed.

90. Nor, contrary to what Bell and TELUS suggest, did this Court determine in the 1989 Bell Canada decision that a credit described as a rebate is necessarily retrospective. As the passage quoted in paragraph 88 makes clear, the Commission ordered a rebate in that case for the express purpose ofmaking past rates just and reasonable. This Court held that, even though a one-time credit to current subscribers was "not the perfect way ofreimbursing excess revenues," it was a reasonable way ofdoing so in view ofthe cost and complexity ofpaying refunds to the actual customers who had paid too much.

Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission) at 1762d-1763a, Bell's Authorities, Volume I, Tab 4, pp. 167-168

91. Nothing in this Court's 1989 decision supports the conclusion that rebates are always retrospective.

92. Rebates do not interfere with past revenues. The ILECs knew in advance that they were not entitled to unrestricted access to the funds in their accounts. They could put in place accounting practices to segregate and deal with the funds pending directions from the Commission. The Commission's directions affect only the funds in the deferral accounts, which had already been set aside. The appellants and the other ILECs therefore did not run the risk of spending or distributing the funds without knowing that they would be held accountable for them at a later date. In these circumstances, the rebate aspect ofthe Deferral Accounts Decision is not retrospective in effect. - 29-

93. Accordingly, the case of Calgary (City) v. Madison Natural Gas Co., on which that Bell relies at paragraph 19 ofits factum, is oflittle assistance. That case involved a regulator reserving for itselfthe right to order, at a laterdate, that a utility disgorge any surpluses earned in excess ofthe allowable rate ofreturn. The surpluses were not collected in a deferral account. Rather, any future order by the regulator would require the surpluses be disgorged directly from the company's profits.

Calgary (City) v. Madison Natural Gas Co. (1959), 19 D.L.R. (2d) 655 at 661 (Alta S.C.A.D.), Bell's Authorities, Volume I, Tab 6, p. 217

94. Here, there is no disgorgement ofrevenues to which the ILECs otherwise had unfettered access. Bell and TELUS, like the other ILECs, had notice that they were not allowed free use of the deferral account funds. They knew that, as stated in the Price Caps Decision, these funds would be distributed in a manner to be directed by the Commission, which could include subscriber rebates. There was no uncertainty associated with the disposition ofthe deferral account funds through rebates. The principle against retrospectivity is therefore not engaged.

95. For these reasons, the rebate aspect ofthe Commission's Deferral Accounts Decision was prospective in both purpose and effect.

Rebates do ltot constitute a "confiscation" offLEes' property.

96. For the same reasons set out above in paragraphs 92-95, ordering payment ofrebates did not constitute a "confiscation" ofILECs' property. As the Federal Court ofAppeal noted, none ofthe parties in the court below, including TELUS, took issue with the Commission using the deferral accounts to impose a contingent obligation on ILECs. The Commission made clear when it required the establishment ofthe accounts in the Price Caps Decision that, though the amounts in the accounts would be paid as part ofrates that it was just and reasonable for customers to pay, it would not be just and reasonable for the earners to have free use ofthe funds as part oftheir return for providing services. The ILECs were therefore not entitled to use these funds for initiatives other than those approved by the Commission.

Price Caps Decision at paras. 402-411, Bell's Authorities, Volume lIT, Tab 18, pp. 111-113 - 30-

Reasons ofthe Federal Court ofAppeal at paras. 21, 52, Appellants' Record, Volume I, pp. 63, 75

The Commission and the Court ofAppealproperly applied section 7

97. The argument that the Commission and the Federal Court ofAppeal treated section 7 as a "power-conferring provision" does not survive a reading ofeither the Deferral Accounts Decision or the reasons ofthe Federal Court ofAppeal.

98. The Commission specifically stated in the Deferral Accounts Decision that "section 7 of the Act sets out the Canadian telecommunications policy objectives and that in this proceeding, as in others, the Commission is obliged to exercise its powers with a view to implementing those objectives" (emphasis added). Its reasons thus faithfully reflected the mandate given it by Parliament in section 47 which provides that the Commission "shall exercise its powers ... with a view to implementing the Canadian telecommunications policy objectives" (emphasis added). The Commission considered that consumer rebates would further these objectives. As discussed above, it had power to require rebates with aview to these objectives.

Deferral Accounts Decision at paras. 23-24,74-80, Appellants' Record, Volume I, pp. 9-10, 15-16

99. The Federal Court ofAppeal correctly described section 7 and section 47 as prescribing the policy objectives that the Commission is expressly required to consider. The combined effect ofthese provisions, the Court stated, was that "the CRTC's rating jurisdiction is not limited to considerations that have traditionally been considered relevant," and that "[t]he range ofconsiderations that are relevant to CRTC rating decisions is considerably broader than the range ofconsiderations expressed or implicit in the statutory schemes considered in" the authorities on which the appellants relied. It concluded that both in setting rates in the Price Caps Decision and in providing for the disposition ofdeferral account funds in the Deferral Accounts Decision, the Commission "based its decision on factors that it is permitted by section 7 to take into account."

Reasons ofthe Federal Court ofAppeal at paras. 35, 37, 41, Appellants' Record, Volume I, pp. 69-71 ·31 -

100. The Federal Court ofAppeal did not do as Bell and TELUS now suggest. Rather, the Court expressly distinguished between the jurisdiction ofthe Commission to regulate and approve rates for telecommunications services, using any method or technique, and its mandate to take into account telecommunications policy objectives in doing so.

Reasons ofthe Federal Court ofAppeal at para. 41, Appellants' Record, Volume I, p. 71

101. Contrary to the appellants' submissions, the Commission's and the Court's reliance on section 7 and 47 is not analogous to what occurred in the Barrie Public Utilities case. As noted above in paragraph 58, the context ofthat case was very different from that here. Barrie Public Utilities involved the question whether the phrase "transmission lines" in section 43(5) ofthe Telecommunications Act was broad enough to includethe power poles ofprovincially regulated electric power companies so as to make these utilities subject to the Commission'sjurisdiction. In that case, the Court held that the policy objectives in section 7 were used to give section 43(5) a scope beyond its plain meaning and that ofrelated provisions and the Act as a whole.

Barrie Public Utilities v. Canadian Cable Television Assn. at paras. 1-2, Bell's Authorities, Volume I, Tab 2, p. 59

102. This case, by contrast, involves resort to the policy objectives set out in section 7 in exercising the Commission's core jurisdiction to determine just and reasonable rates. Moreover, the plain meaning ofthe relevant provisions ofthe Act is not limiting but expansive. To repeat, it expressly authorizes the Coinmission to adopt any method or technique that it considers appropriate in determining whether a rate is just and reasonable, and expressly requires that it consider the section 7 objectives in all that it does.

103. The Commission's decision and the reasons ofthe Court ofAppeal demonstrate that both appropriately treated section 7 not as "power-conferring" but as what it is: a statement by Parliament ofthe Canadian policy objectives that the Commission is to consider in exercising all ofits powers, including its rate setting powers, under the Act.

PART IV - SUBMISSIONS ON COSTS

104. The Commission does not seek costs. As set out in paragraph 13, none may be awarded against it. - 32 -

PART V- ORDER SOUGHT

105. The Commission requests an order dismissing the appeal.

ALL OF WHICH IS RESPECTFULLY SUBMITTED

John B. Laskin

Afshan Ali

Counsel for the Respondent/Intervener Canadian Radio-television and Telecommunications Commission - 33 -

PART VI - TABLE OF AUTHORITIES

Paragraph(s) in Cases Factum

·1. Allstream Corp. v. Bell Canada, 2005 FCA 247 50,56,57,69

2. ATCO Gas & Pipelines Ltd. v. Alberta (Energy & Utilities Board), 58, 64, 65, 66, [2006] 1 S.C.R. 140,2006 SCC 4 75, 79

3. Barrie Public Utilities v. Canadian Cable Television Assn., [2003J 48,58,101 1 S.C.R. 476, 2003 SCC 28

4. Bell Canada 2002 Annual Price cap filing, Telecom Decision 26 eRTC 2003-15

5. Bell Canada v. Canada (Canadian Radio-television and 14,15,17,43, Telecommunications Commission), [1989J 1 s.e.R. 1722 58,67,87,88,90

6. British Columbia Telephone Co. v. Shaw Cablesystems (B. C) Ltd., 58 . [1995] 2 S.c.R. 739

7. Calgary (City) v. Madison Natural Gas Co. (1959), 19 D.L.R. (2d) 93 655 (Alta S.C.A.D.)

8. Communications Canada, Telecommunications: New Legislation 16 for Canada (February 1992)

9. Council ofCanadians with Disabilities v. VIA Rail Canada Inc., 40,50 [2007] 1 S.C.R. 650,2007 SCC 15 .

10. Disposition offunds in the deferral accounts, Telecom Decision 1,22,25,27-33, CRTC 2006-9 92,95,97,98

11. Dunsmuir v. New Brunswick, 2008 SCC 9 40,47,53,54, 57,59,60

12. Follow-up to Decision 2002-43 -Socifite en Commandite TeIebec's 25 request to r.ecover the start-up costs for local competition and local numberportability, Telecom Decision CRTC 2005-76 13. MTS Allstream Inc. v. Edmonton (City), 2007 FCA l06 56, 57,58

14. Price cap frameworkfor large incumbent local exchange carriers, 21 Telecom Decision CRTC 2007-27 ·34 -

Paragraph(s) in Cases Factum

15. Regulatoryframeworkfor secondprice cap period, Telecom 21,23,24,25, Decision CRTC 2002-34 26,27,30,31, 32,43,94,96

16. Review ofregulatoryframework, Telecom Decision CRTC 94-19 19

17. Ryan, Canadian Telecommunications Law and Regulation (2005+) 70

18. TEL US Communications Inc., 2002 Annualprice cap filing, 26 Telecom Decision CRTC 2003-18

19. TEL US Communications Inc. - Application to increase the capital 25 costs ofits service improvement plan and related matters, Telecom Decision CRTC 2004-76

20. Use ofdeferral accountfunds to improve access to 34,35 telecommunications servicesfor persons with disabilities and to expand broadband services to rural and remote communities, Telecom Decision CRTC 2008-1 - 35 -

PART VII - RELEVANT STATUTES AND REGULATIONS

Telecommunications Act Loi sur les telecommunications

1993, c. 38 '1993, ch. 38

T-3.4 T-3.4

[Assented to June 23rd, 1993J [Sanctionnee Ie 23 juin 1993J

An Act respecting telecommunications Loi concernant les telecommunications

CANADIAN TELECOMMUNICATIONS POLICY POLITIQUE CANADIENNE DE TELECOMMUNICATION

Objectives Politique

7. It is hereby affirmed that telecommunications 7. La presente loi affirme Ie caractere essentiel des performs an essential role in the maintenance of telecommunications pour I'identite et la souverainete Canada's identity and sovereignty and that the Canadian canadiennes; fa politique canadienne de telecommunications policy has as its objectives telecommunication vise a:

(a) to facilitate the orderly development throughout a) favoriser Ie developpement ordonne des Canada of a telecommunications system that serves telecommunications partout au Canada en un to safeguard, enrich and strengthen the social and systeme qui contribue a sauvegarder, enrichir et economic fabric of Canada and its regions; renforcer la structure sociale et economique du Canada et de ses regions; (b) to render reliable and affordable telecommunications services of high quality b) permettrel'acces aux Canadiens dans toutes les accessible to Canadians in both urban and rural regions - rurales ou urbaines - du Canada a des areas in all regions of Canada; services de telecommunication sOrs, abordables et de qualM; , (c) to enhance the efficiency and competitiveness, at the national and international levels, of Canadian c) accroltre I'efficacite et la competitivite, sur les plans telecommunications; national et international, des telecommunications canadiennes; (ef) to promote the ownership and control of .Canadian carriers by Canadians; d) promouvoir I'accession ala propriete des entreprises canadiennes, et a leur controle, par des Canadiens; (e) to promote the use of Canadian transmission facilities for telecommunications within Canada and between Canada and points outside Canada; e) promouvoir I'utilisation d'installations de transmission canadiennes pour les telecommunications a l'interieur du Canada et a (f) to foster increased reliance on market forces for destination ou en provenance de I'etranger; the provision of telecommunications services and to ensure that regLilation, where required, is efficient and effective; f) favoriser Ie libre jeu du marche en ce qui conceme la fourniture de services de telecommunication et assurer I'efficacit~ de la n§glementation, dans Ie cas (g) to stimulate research and development in -36-

Canada in the field of telecommunications and to 00 celle-ci est necessaire; encourage innovation in the provision of telecommunications services; g) stimuler la recherche et Ie developpement au Canada dans Ie domaine des telecommunications (h) to respond to the economic and social ains; que !'innovation en ce qui touche la fourniture de requirements of users of telecommunications services dans ce domaine; services; and h) satisfaire les exigences economiques et sociales (I) to contribute to the protection of the privacy of des usagers des services de telecommunication; persons. I) contribuer ala protection de la vie privee des personnes.

PARTIE III

TARIFS, INSTALLATIONS ET SERVICES PART III

RATES, FACILITIES AND SERVICES FOURNITURE DE SERVICES

Conditions de commercialisation PROVISION OF SERVICES 24. L'offre et la fourniture des services de Conditions of service telecommunication par f'entreprise canadienne sont assujetties aux conditions fixees par Ie Conseil au 24. The offering and provision of any contenues dans une tarification approuvee par celui-ci. telecommunications service by a Canadian carrier are subject to any conditions imposed by the Commission or Autorisation necessaire pour les tarifs included in a tariff approved by the Commission.

25. (1) L'entreprise canadienne doit foumir les Telecommunications rates to be approved services de telecommunication en conformite avec la tarification deposee aupres du Conseil et approuvee par 25. (1) No Canadian carrier shall provide a celui-ci fixant - notamment sous forme de maximum, de telecommunications service except in accordance with a minimum ou des deux - les tarifs a imposer ou a tariff filed with and approved by the Commission that percevoir. specifies the rate or the maximum or minimum rate, or both, to be charged for the service. Tarifs justes et raisonnables

Just and reasonable rates 27. (1) Tous les tarifs doivent etre justes et raisonnables. 27. (1) Every rate charged by a Canadian carrier for a telecommunications service shall be just and Discrimination injuste reasonable. (2) II est interdit a I'entreprise canadienne, en ce qui Unjust discrimination concerne soit la fourniture de services de telecommunication, soit "imposition ou la perception des (2) No Canadian carrier shall, in relation to the provision tarifs y afferents. d'etablir une discrimination injuste, au of a telecommunications service or the charging of a rate d'accorder - y compris envers elle-meme - une for it, unjustly discriminate or give an undue or preference indue ou deraisonnable. au encore de faire unreasonable preference toward any person, including subir un desavantage de meme nature. itself, or subject any person to an undue or unreasonable disadvantage. Questions de fait

Questions of fact (3) Le Conseil peut determiner, comme question de fait, si rentreprise canadienne s'est ou non conformee aux (3) The Commission may determine in any case, as a dispositions du present article ou des articles 25 ou 29 ou question of fact, whether a Canadian carrier has a toute decision prise au titre des articles 24, 25, 29, 34 complied with section 25, this section or section 29, or ou40. -37 -

with any decision made under section 24, 25,29, 34 or 40. Fardeau de la preuve

• Burden of proof (4) II incombe aI'entreprise canadienne qui a fait preuve de discrimination, accorde une preference ou fait subir un (4) The burden of establishing before the Commission desavantage d'etablir, devant Ie Conseil, qu'i1s ne sont that any discrimination is not unjust or that any pas injustes, indus ou deraisonnables, selon Ie cas. preference or disadvC3ntage is not undue or unreasonable is on the Canadian carrier that Methodes discriminates, gives the preference or subjects the person to the disadvantage. (5) Pour determiner si les tarifs de I'entreprise canadienne sont justes et raisonnables, Ie Conseil peut Method utiliser la methode ou la technique qu'jf estime appropriee, qu'eIJe soit ou non fondee sur Ie taux de (5) In determining whether a rate is just and rendement par rapport a la base tarifaire de I'entreprise. reasonable, the Commission may adopt any method or technique that it considers appropriate, whether based Precision on a carrier's return on its rate base or otherwise. (6) Le present article n'a pas pour eftet d'empecher Exception I'entreprise canadienne de fournir, graluilemenl au mayennant un tarif reduit, des services de (6) Notwithstanding subsections (1) and (2), a Canadian telecommunication soit a ses administrateurs, dirigeants, carrier may provide telecommunications services at no employes et anciens employes soit, avec I'agrement du charge or at a reduced rate Conseil, ades organismes de bienfaisance, a des personnes defavorisees ou atoute personne. (8) to the carrier's directors, officers, employees or former employees; or

(b) with the approval of the Commission, to any charitable organization or disadvantaged person or other person. Pouvoirs

General powers 32. Le Conseil peut, pour I'application de /a presente partie: 32. The Commission may, for the purposes of this Part, c} modifier toute tarification deposee aux termes de I'article 25 ou tout accord ou entente vises aI'article c) amend any tariff filed under section 25 or any 29; agreement or arrangement submitted for approval under section 29; d) suspendre au refuser I'application de tout ou partie d'une tarification, d'un accord ou d'une entente qu'il (d) suspend or disallow any portion of a tariff, juge incompatible avec la presente partie; agreement or arrangementthat is in its opinion inconsistent with this Part; e} obliger I'entreprise en cause a remplacer les dispositions rejetees, ou y proceder lui-meme; (e) substitute or require the Canadian carrier to substitute other provisions for those disallowed; f) obliger I'entreprise en cause a deposer, en tout au en partie, une tarification ou un accord ou une (f) require the Canadian carrier to file another tariff, entente en remplacement de dispositions rejetees ou agreement or arrangement, or another portion of it, dont ('application est suspendue; in substitution for a suspended or disallowed tariff, agreement, arrangement or portion; and g) en ('absence dedisposition applicable dans la presente partie, trancher toute question touchant les (g) in the absence of any applicable provision in this tarifs et tarifications des entreprisescanadiennes ou Part, determine any matter and make any order les services de telecommunication qu'elles relating to the rates, tariffs or telecommunications fournissent. services of Canadian carriers. -38-

PROVISION OF INFORMATION COMMUNICATION DE RENSEIGNEMENTS

Information requirements Obligation d'information

37. (1) The Commission may require a Canadian 37. (1) Le Conseil peut soit imposer a J'entreprise carrier canadienne I'adoption d'un mode de calcul des coOts lies ases services de telecommunication et de methodes ou (a) to adopt any method of identifying the costs of systemes comptabJes relativement aI'application de la providing telecommunications services and to adopt presente loi, soit I'obliger alui communiquer dans des any accounting meth.o? or ~ystem ~f accounts for the rapports periodiques - ou selon les modalites de forme purposes of the adminIstration of thIs Act; or et autres qu'i1 fixe - tous les renseignements qu'i1 juge necessaires pour I'application de la presente loi ou d'une b) to submit to the Commission, in periodic reports or loi speciale. in such other form and manner as the Commission specifies, any information that the Commission considers necessary for the administration of this Act or any special Act.

Exception Exception

(2) Where the Commissi?~ believes t~at a ~erson o~her (2) S'i1 croit qu'une personne, a ('exception d'une . than a Canadian carrier IS In possession of information entreprise canadienne, detient des renseignements qU'11 that the Commission considers necessary for the juge necessaires pour J'application de la presente loi ou administration of this Act or any special Act, the d'une loi speciale, Ie Conseil peut I'obliger ales lui Commission may require that person to submit the . communiquer dans des rapports periodiques qu'elle information to the Commission in periodic reports or In etablit ou fait etablir selon Ie cas - ou seloflles modalites such other form and as the Commission manner de forme ou autres qu'i1 fixe - ,sauf s'i1 s'agit de specifies, unless the information is a confidence of the renseignements confidentiels du conseil executif d'une executive council of a province. province.

Transmittal Communication

sha~I, ?~ (3) The Commission request, provid? the (3) Le Conseil transmet, sur demande, les Minister or the Chief Statistician of Canada With any renseignements rec;us au ministre ou au statisticien en information submitted to the Commission. chef du Canada. 1993, 38, 5.37; 1999, 31, 203(F). c. c. s. 1993, ch. 38, art. 37; 1999, ch. 31, art. 203(F).

PART IV PARTIE IV ADMINISTRATION APPLICATION

EXERCISE OF POWERS EXERCiCE DES POUVOIRS ET FONCTIONS PAR LE Commission subject to orders and standards CONSEIL

Conseil soumis aux normes et decrets 47. The Commission shall exercise its powers and' perform its duties under this Act and any special Act 47. Le Conseil doit, en se conformant aux decrets que lui adresse Ie gouverneur en conseil au titre de imple~entin.g t~e (a) with a view to Canadian . "article 8 ou aux normes prescrites par arrete du ministre telecommunications policy objectIves and ensuring au titre de "article 15, exercer les pouvoirs et fonctions that Canadian carriers provide telecommunications que lui conferent la presente loi et toute loi speciale de -39-

services and charge rates in accordance with section maniere arealiser les objectifs de la politique canadienne 27; and de telecommunication et aassurer la conformite des services et tarits des entreprises canadiennes avec les dispositions de I'article 27.. (b) in accordance with any orders made by the Governor in Council under section 8 or any standards prescribed by the Minister under section 15. Questions of law and fact Questions of law and fact 52. (1) The Commission may, in exercising its powers 52.(1) The Commission may, in exercising its and performing its duties under this Act or any special powers and performing its duties under this Act or any Act, determine any question of law or of fact, and its special Act, determine any question of law or of fact, and determination on a question of fact is binding and its determination on a question of fact is binding and conclusive. conclusive. ApPEL ApPEALS Droit d'appel Appeal to Federal Court of Appeal 64. (1) Avec son autorisation, iI peut etre interjete 64. (1) An appeal from a decision of the Commission appel devant la Cour d'appel federale, sur des questions on any question of law or of jurisdiction may be brought de droit ou de competence, des decisions du Consei/. in the Federal Court of Appeal with the leave of that Court. Demande d'autorisation de pourvoi

(2) Leave to appeal shall be applied for within thirty (2) L'autorisation est ademander dans les trente jours qui days after the date of the decision appealed from or suivent la decision ou dans Ie dela; superieur qu'un juge within such further time as a judge of the Court de la Cour peut exceptionnellement accorder; les frais grants in exceptional circumstances, and the costs relatifs' a la demande sont laisses a I'appreciation de la of the application are in the discretion of the Court. Cour.

Notice Avis

(3) Notice of an application for leave to appeal shall be (3) Avis de la demande d'autorisation est donne au served on the Commission and on each party to the Conseil et a toutes les parties a I'affaire. proceedings appealed from. Appel Time limit for appeal (4) L'appel'doit etre interjete dans les soixante jours (4) An appeal shall be brought within sixty days after suivant la date de I'autorisation. the day on which leave to appeal is granted.

Decision Findings of fact (5) Lors de I'audition d'un appel, 18 Cour peut deduire (5) On an appeal, the Court may draw any inference that tcutes les conclusions qui ne sont pas incompatibles avec is not inconsistent with the findings of fact made by the les faits etablis devant Ie Conseil et qui sont necessaires Commission and that is necessary for determining a pour determiner la question de competence ou de droit. question of law or jurisdiction. Observations du Conseil Argument by Commission

(6) Le Conseil a Ie droit de presenter des observations (6) The Commission is entitled to be heard on an pendant I'instruction de la demande d'autorisation et application for leave to appeal and at any stage of an ensuite atoute etape de la procedure d'appel; les frais ne appeal, but costs may not be awarded against it or any of peuvent cependant etre mis a sa charge ou a celie des its members. conseillers.

1993, c. 38, s. 64; 1999, c. 31, s. 206(F). 1993, ch. 38, art. 64; 1999, ch. 31, art. 206(F).