A government ruling allows Canada's biggest phone companies to be freed from regulations in some markets, opening the door for more competition and lower home telephone bills.

The Canadian Radio-television and Telecommunications Commission (CRTC) on Wednesday gave permission to allow Telus Corp. and Bell Aliant to set telephone rates in several municipalities, including Fort McMurray, Alta.; Fredericton; Charlottetown; and Halifax.

The ruling is the first of what is expected to be a flurry of decisions that will result in home telephone services being largely deregulated in many regions of the country.

Telus and Bell Aliant will also no longer need the federal regulator's approval to introduce new services and service packages.

The CRTC has received a number of applications from telecom companies -- representing 60 per cent of residential phone lines -- to deregulate local landline phone services.

The Commission removed price regulations on long-distance phone services in the late 1990s, but for decades, phone companies have had their rates set for them.

The regulator has always allowed carriers to set their own prices and service packages for Internet and wireless services.

Telecom companies have long argued they need more control over their home phone rates and bundle services to compete with cable and wireless firms that have encroached on their markets without being subject to rate regulations.

Telus has applied to have the restrictions lifted on its home phone markets in Vancouver, Victoria, Calgary, Edmonton, Rimouski, Que., and Fort McMurray, The Globe and Mail reports.

Manitoba Telecom Services Inc. has reportedly applied for similar freedoms in Winnipeg, while Bell has submitted several applications in such cities as Toronto, Montreal, Ottawa-Gatineau, London, Hamilton and Quebec City.

To protect customers, the CRTC has put in place certain restrictions preventing Telus and Bell Aliant from hiking the price they currently charge for basic phone service in the newly deregulated areas.

The decision stems from a directive from the federal government that the CRTC move to deregulate the home phone market in those that give consumers the choice of three or more carriers, including cellphone providers.

As the part of the directive, 10 telecom providers earlier this week established a consumer complaints agency, which must still be approved by the CRTC.

With files from The Canadian Press