Hon. Dennis Glen Patterson: I was hoping to ask a question of Senator Housakos.

Hon. Dennis Glen Patterson moved third reading of Bill S-242, An Act to amend the Radiocommunication Act, as amended.

He said: Honourable senators, it is my honour to rise at third reading of my bill, Bill S-242, An Act to amend the Radiocommunication Act.

I have always said that I feel that the strength of the Senate lies in the work of its committees. I am thankful to have worked on this bill in committee with such a dedicated group of senators, capably chaired by my colleague Senator Housakos. Their thoughtful questions and openness to collaboration helped us bring forward what I feel is the best version of this bill.

As colleagues know, our individual office resources do not come close to those of a government department, so this collaborative approach to the drafting of legislation, particularly in complicated areas such as broadband usage and allocation, is most welcome.

In addition to thanking members of the committee, I would be remiss if I did not acknowledge, in this connection, my capable and indefatigable Director of Parliamentary Affairs, Claudine Santos, who has ably supported me in achieving consensus on fine-tuning the bill.

I am also grateful to the many witnesses and stakeholders who gave their time, energy and expertise in order to help inform the amendments to this bill.

Bill S-242 has come to be colloquially referred to as “the use it or lose it” bill by those familiar with it. The bill aims to ensure that spectrum purchased by a proponent is actually deployed. It attempts to reduce the amount of fallow spectrum by creating ramifications for proponents that would engage in the practice of spectrum trafficking or — as we have come to call it, based on a comment from Senator Simons at committee — spectrum squatting. Some of you may be asking, “What did he just say?” It has taken me a while to get a handle on it as well.

Wireless spectrum is a limited resource that refers to the range of frequencies that are used for wireless communication like Wi‑Fi and cell service. Think of it like a highway for data and signals that travel from your device to the internet and back.

There are different lanes, or frequency bands, within the wireless spectrum — each with its own speed limit, and each suited to different types of data traffic. The government regulates and allocates these frequency bands to different companies and organizations for use — ensuring that there is enough spectrum available for everyone, and that different devices can communicate without interfering with each other.

In Canada, the regulation of wireless spectrum is the responsibility of Innovation, Science and Economic Development Canada, fondly known as ISED. ISED is responsible for developing and implementing policies and programs related to the efficient and effective use of the spectrum resource. This includes licensing and allocating spectrum to various users, such as wireless carriers, broadcasters and government agencies.

ISED also ensures that the use of spectrum does not cause interference to other users, such as radio stations. The decisions that ISED makes affect how quickly Canadians are connected.

Spectrum auctions are a method used by governments to allocate spectrum licences to the highest bidder. In a spectrum auction, companies and organizations bid on the right to use specific frequency bands for their wireless communication services. The bids are made in a competitive environment, with each participant bidding against one another to secure the licence.

The government collects the auction proceeds, which can be substantial, as the demand for spectrum has increased with the growth of wireless technologies and services. In the last spectrum auction, which took place in April 2019, the Government of Canada made $3.4 billion by selling 104 licences.

Spectrum auctions are widely used in many countries, including the United States, Canada and Europe, as a way to allocate valuable spectrum resources and to raise revenue for the government.

Fallow spectrum, or undeployed spectrum, refers to a range of frequencies that have been granted to a telecommunication company or organization by a government or regulatory body but which have not been fully utilized or deployed for communication services. This unused spectrum can be a valuable asset, as there is often high demand for additional bandwidth to support growing data and connectivity needs. In some cases, telecommunication companies may choose to hold on to their undeployed spectrum to increase its value over time. This has sometimes been called “spectrum arbitrage.” Often in Canada, some companies choose to sell this spectrum to other organizations for massive profits. This leaves behind the communities that would benefit from the connectivity the spectrum would provide.

In Canada, some telecommunication companies are awarded spectrum licences by the government with a substantial subsidy. In many cases, these companies may not fully utilize or deploy all of the spectrum that they have been granted. Instead, they may choose to sell their unused spectrum to other companies for a massive profit, effectively turning the government subsidy into profit.

Spectrum trafficking — and I love Senator Simons’ colourful description, “spectrum squatting” — is the practice of buying spectrum at a massive discount, not deploying it and reselling it years later. It is highly profitable, but leaves communities behind — especially rural, remote, Northern and Indigenous communities — because this spectrum, which should be a public resource, should have been connecting them. In my opinion, spectrum should be used to connect Canadians, as opposed to being sat on and then flipped for a profit.

Enter Bill S-242. While it is in no way a panacea to all the ills that plague our broadband and telecommunication system in Canada, I believe it is a good solution to a specific issue. This bill has evolved through dialogue with industry experts, proponents, academics and, as I said, my respected colleagues into legislation that proposes to establish a use-it-or-lose-it as well as a use-it-or-share-it model that will ensure more Canadians are connected.

Currently, it is left to ISED’s sole discretion what deployment conditions are attached to awarded licences. Very few licences are revoked due to failure to meet deployment conditions. We learned this in the committee study of the bill. And yet, the Canadian Radio-television and Telecommunications Commission, or CRTC, has repeatedly spoken of the “digital divide” experienced by rural Canadians.

According to the CRTC website, “. . . many Canadians, particularly those in rural and remote areas, do not have adequate access . . .” to internet services. The government’s own National Broadband Internet Service Availability Map shows a number of rural and remote communities that are either under-serviced, meaning they fall below the national threshold of 50 megabits-per-second download speed and 10 megabits-per-second upload speed, or they are not connected at all. To me, this is a clear indication that current deployment conditions are too lax.

Bill S-242 proposes to establish a baseline for deployment conditions that many stakeholders, including individual internet providers and the association representing Canadian wireless internet service providers, or CanWISP, agreed were fair and reasonable. The bill would simply require all spectrum licence holders to deploy spectrum to 50% of the population within prescribed geographic regions contained in the licence area, known as Tier 5 areas, within three years of acquiring the licence. This would ensure that those buying larger-area licences, or Tier 1 to 4 licences, would not be able to meet deployment conditions by simply deploying to the urban areas within those large tiers, but would also be required to service the smaller, rural and remote areas nestled within.

The bill also places an emphasis on the use of subordinate licences, or sub-licences, as a solution to meeting the deployment conditions. It would give the minister the flexibility to decide whether to revoke the entire licence outright or to reallocate Tier 5 areas within the licence to other providers that are ready and able to service the underserved areas. If the licence is revoked, the minister would need to reallocate the spectrum within 60 days, using either another competitive process or some other system of reallocation, such as first-come, first-served. The proponent and its affiliate companies would be ineligible to reapply.

The third main component of this bill is the civil liability clause. The intent of this clause is to ensure that if the licence holder, by acting in bad faith, did not meet the deployment conditions and had their licence revoked, the population that had been serviced by the provider and lost that service due to the revocation may initiate a civil claim for damages. Quebec is the only jurisdiction that I know of with a civil liability code that would enable customers to sue a company in this manner. That is why I believe that this clause is necessary, as it would enable those who lose connection due to the actions or relative inaction of a licence holder to sue. It is well understood in law that in order for a civil liability claim to go forward, the plaintiff must establish loss or damage based on the negligence or malicious intent of another party.

Currently, ISED may be hesitant to revoke a licence if it results in any percentage of the population getting disconnected. That is why I contend that the civil liability clause would not only help ISED make the decision to revoke a licence, knowing that there is a remedy for anyone disconnected, but also serve as an added incentive to licence holders to meet the deployment conditions.

Every witness who appeared stated that they supported the spirit and intent of the bill. The only witnesses who outright felt the bill was unnecessary were ISED, whose current handling of spectrum deployment is, frankly, being criticized by this bill, and the larger service providers represented by the Canadian Wireless Telecommunications Association, who are the perpetrators of spectrum trafficking or spectrum squatting. Do with that information as you will.

Honourable senators, since 2012, the United Nations Human Rights Council has adopted five resolutions that follow along the theme of the internet as a human right. In an increasingly digital world, access to the internet isn’t just the ability to stream a movie or play a game online; it’s the ability to start a business, connect with a specialist, learn from home, provide government services like telehealth and so much more.

I want to thank my colleagues for their support of this bill. It is one small piece in a very large puzzle, but I believe that it will bring us closer to finally bridging the digital divide. Certainly, ensuring that all available spectrum is deployed is integral to connecting all Canadians. Thank you. Qujannamiik.