OTTAWA — Canada will lift foreign ownership restrictions on small local telecommunications firms, Industry Minister Christian Paradis announced Wednesday.

The current limit of direct foreign investment in broadcasting and telecommunications carriers is 46.7 percent.

Paradis told a press conference the restriction would be lifted for telecom companies that hold less than a 10-percent share of the total Canadian telecommunications market to allow smaller players access to capital to grow.

He also said caps would be applied in an upcoming auction to guarantee that new entrants in the Canadian sector have access to the spectrum up for grabs, alongside incumbent carriers.

"The measures I am outlining today will ensure the timely availability of world-class wireless services at low prices for Canadian families, including those in rural areas," the minister said.

According to a government consultation paper, only three countries that are members of the Organization for Economic Cooperation and Development restrict foreign investment in their telecommunications sectors: Canada, Mexico and South Korea.

Among them, Canada's rules are the strictest.

Three carriers -- Bell, Rogers and Telus -- currently dominate the Canadian telecommunications sector, which is worth 40 billion dollars annually.