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In northeastern British Columbia, Arvo Koppel's small Internet provider employs field technicians who hike and ski through deep valleys and thick forests with telecommunications equipment strapped to their backs. They'll hammer antennas to trees, or place signal repeaters on the top of mountains.
Members of the Peace Region Internet Society, typically farmers and other rural dwellers who want better links to the online world, regularly give up space on their land for equipment, and volunteer to help connect neighbours who can be as far as 10 kilometres away. They do it because Canada's big telecom companies won't provide high-speed Internet access to many of these areas, since there is no profit in hooking up sparsely populated, difficult-to-serve regions.
Now the group, which has been offering wireless Internet access over an unregulated - and often unreliable - slice of public airwaves since 1993, wants to upgrade. It has applied to use a higher-quality piece of wireless spectrum, one that will allow it to offer faster connections that won't be affected by interference from run-of-the-mill wireless devices like garage door openers, as its current service does.
But the effort has hit a bizarre obstacle: Industry Canada says the 5,000-member society, all of whom are residents of B.C. or Alberta, is not Canadian enough to qualify.
In an e-mail to Mr. Koppel last week, the federal department rejected the society's application because it "does not meet the definition for being Canadian-owned and -controlled." Foreign entities are not allowed to control wireless spectrum.
"I just couldn't believe it," said Mr. Koppel, who helps run the society, which has only nine employees, as well as eight elected directors. The organization first applied for the spectrum about a year ago. "And way back a year ago they said, 'Okay, to meet these requirements you're going to need a sworn affidavit from each director proving that they're Canadian.' So we did all that. We had to go to a notary and so forth. It's 25 bucks a pop, but we did that. We also had to present flowcharts."
But the society was still deemed un-Canadian because it does not issue shares. The organization instead relies upon a structure where any profits are plunged back into providing services to its members in remote areas.
"The definition of being Canadian-owned and -controlled requires that Canadians beneficially own 80 per cent of the corporation's voting shares (issued and outstanding), and the [Peace Region society] being a corporation without share capital, does not issue voting shares and therefore doesn't meet the requirement," said an e-mail from an Industry Canada official.
Though Industry Canada is currently mulling over a plea from Mr. Koppel to reconsider, the issue highlights the struggles that small, rural Internet providers are facing as Ottawa grapples with what to do about regions of the country that suffer from poor or unreliable Web connections.
Like many other small ISPs across Canada, Mr. Koppel's group is already dealing with the fact that a $225-million federal stimulus fund to extend rural broadband has armed larger, out-of-region firms with public money to offer similar wireless Internet services in areas where smaller companies - like his own - already operate.
Mr. Koppel finds it ironic that new wireless player Wind Mobile, which has significant financial backing from an Egyptian company, is considered Canadian when a grassroots organization like his own is not. Under B.C.'s provincial laws, as he has pointed out to Industry Canada, "the members of a society are members of a corporation."
Marita Moll, a board member of TeleCommunities Canada, a national alliance of community Internet networks, said B.C. government officials have been "way ahead of the curve" in encouraging local groups to band together and offer telecom services to their own remote areas.
"It seems to be that they (Industry Canada) didn't foresee this kind of thing, perhaps, or there's some kind of gap in regulations that doesn't accommodate this," Ms. Moll said. "It's a good opportunity to show that they're willing to fix this kind of thing when it does come up, because this group has been serving this community so well, for so long."