Putting Canada’s media industry in play by loosening foreign ownership rules became a federal election issue Monday.

Prime Minister Stephen Harper told reporters during a campaign stop in Sault St. Marie that his government had made no final decision on how to relax foreign ownership limits on domestic telecom companies.

“We’ve not made a final decision on the nature of what we’re seeking there,” Harper said, while appearing to rule out lifting foreign ownership rules altogether.

“We’re guided by, first of all, to ensure whatever changes we make are oriented toward providing more choice and options and competition and competitive prices for consumers, and also that we do not lose a strong telecommunications sector here in this country,” the prime minister said.

The federal government has already signaled that it seeks more venture capital and foreign investment in the telecom sector.

Canadian cable operators and broadcasters, many family controlled, have urged Ottawa that it cannot open up telecommunications to additional foreign investment without impacting broadcasting, given increasing industry convergence.

As a result, cable operators and broadcasters have demanded equal treatment in national legislation should existing foreign ownership rules be relaxed or lifted.

Industry minister Tony Clement last June told the Canadian Telecom Summit that his government was considering among its options lifting foreign ownership to a 49% cap, or up to 100% in companies with less than a 10% market share, or scrapping all barriers to foreign ownership.

But by the year-end, Clement had delayed a possible foreign ownership liberalization bill for a year or more, with industry analysts indicating the Harper government faced cold feet ahead of a possible federal election and the possibility of a voter backlash.