OTTAWA - In a highly unusual move, taxpayer-funded Telefilm Canada has intervened before the CRTC in favour of Bell Canada Enterprise's proposed $3.4-billion takeover of Astral Media - a merger critics say would limit media competition in Canada.

Telefilm has submitted a brief to the commission, arguing the merger should be allowed because it's confident that BCE "will invest in Canada's feature film sector" and an even bigger Bell offers greater opportunity for Canadian film promotion.

The Crown corporation, which collects almost $106 million per year from taxpayers, is lobbying another part of government on a transaction between two private companies.

"Telefilm is arm's length and they make their own decisions," said Sebastien Gariepy, a spokesman for Heritage Minister James Moore's department, which is responsible for Telefilm. "We don't have any further comments."

The Prime Minister's Office also declined comment.

Telefilm, whose CEO collects a salary of up to $247,700, would not answer questions about how its board decided to intervene in favour of Bell or who initiated the intervention.

The CRTC has also received an intervention from RCMP Insp. J. D. Hart in Terrace, BC, in favour of BCE swallowing the local Astral radio stations the Mounties deal with.

Using RCMP letterhead, Hart delves into cultural issues in his intervention, arguing the move will "help to ensure the production of new Canadian content."

Neither the RCMP in BC, nor the office of Public Safety Minister Vic Toews, responded to QMI Agency's request for comment on why a Mountie would intervene in a CRTC hearing.

The interventions come as BCE and Astral competitors ring alarm bells about the deal.

Earlier this week, cable companies Cogeco and Eastlink allied with Quebecor - which owns Sun Media and QMI Agency - to launch a campaign to raise public opposition to the takeover.

"This deal carries a huge risk to the consumer that would see the cost of television programming rise while service deteriorates," said Quebecor CEO Pierre Karl Peladeau on Tuesday.

The coalition warns BCE would grab 38% of the national TV market if the merger were allowed to proceed, giving it an unfair advantage in setting advertising rates and controlling access to programming.

The CRTC has scheduled a Sept. 10 hearing on the deal, while the Competition Bureau says it's also investigating "serious concerns" about the Bell-Astral marriage.