Wireless carriers lose federal court appeal on wireless code

Canadians with three-year wireless contracts can indeedwalk away from them after two years without payingcancellation fees starting June 3, after Canada's wireless carriers lost a federal court appeal.

The CRTC's new wireless code, designed to spell out rights and regulate contracts for mobile customers, allows consumers to cancel wireless contracts after two years with no fees. The code, which took effect on Dec. 2, 2013, is set to apply to all wireless contracts by June 3, 2015.

However, Bell, Rogers, Telus, along with many smaller carriers such as Sasktel, MTS and Northerntel, appealed part of the code in federal court, arguing that someof their three-year contracts will not have expired by this upcoming June 3.

• Mobile carriers challenge CRTC's wireless conduct code

Those three-year contracts come with incentives, such as discounts on mobile devices. The mobile carriers argued that if customers can cancel the contracts before the three years are up, the carriers may not be able to recover the cost of the incentives.

However, the federal court ruled Tuesday that the CRTC has the right to make the wireless code applicable to three-year contracts that expire after the June 3 deadline, even if that interfered with the rights of mobile carriers.

The Ottawa-based Canadian Internet Policy and Public Interest Clinic, which represented consumer groups fighting the appeal, called the decision "carefully thought out."

"It would be impossible if not impractical for the CRTC to carry out its task without the ability to interfere with vested rights," CIPPIC said in a blog post Wednesday.

• CIPPIC blog post with full court ruling