Shaw says Competition Bureau’s opposition of Rogers merger based on ‘fundamental misconceptions’

Both Shaw and Rogers filed responses with the Competition Tribunal

Rogers and Shaw are asking the Competition Tribunal to dismiss the Commissioner of Competition’s order blocking their proposed $26 billion merger.

The Commissioner filed an application to the Competition Tribunal last month, saying the merger would impact wireless competition in Canada. The application further states Shaw owned Freedom Mobile’s ability to compete in the wireless market depends on how Shaw leverages its wireless assets.

In separate responses to the Competition Tribunal, both Rogers and Shaw disagreed.

Shaw’s response

Shaw says the Commissioner of Competition’s application to block its overtaking by Rogers is based on “fundamental misconceptions” about its business.

In its response, Shaw says the commissioner wants to block the merger because he believes it will lessen wireless competition in parts of Alberta, British Columbia, and Ontario, but “there is simply no basis for this extraordinary measure.”

Shaw says the commissioner’s concerns about the inseparability of its wireless and wireless business are “wholly misplaced.” The company says it purposely designed Freedom Mobile to be a standalone business and ensure “it can cleanly and easily be separated from Shaw.”

“Contrary to the Commissioner’s allegations, Freedom Mobile’s success under Shaw’s ownership has not depended on “leveraging” Shaw’s wireline assets.”

Rogers response

Rogers says the acquisition won’t decrease competition but will lead to “substantial efficiencies for the Canadian economy.”

The Toronto-based company said the commissioner’s rejection to sell Freedom Mobile is “unreasonable” and “not supportable at law.”

Rogers says the divestiture of Freedom as a fourth competition in the wireless market will eliminate any alleged concerns the merger would have on competitive effects.

The responses were filed less than a week after Rogers agreed it wouldn’t close the merger until it reached an agreement with the Competition Bureau. 

Both companies are asking the tribunal to dismiss the commissioner’s application.