ARCHIVED - Public Notice CRTC 2001-17

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Public Notice CRTC 2001-17

 

Ottawa, 1 February 2001

 

Amendments to the Broadcasting Distribution Regulations, Pay Television Regulations, 1990 and Specialty Services Regulations, 1990.

 

Summary

 

The Commission has adopted the amendments to the Broadcasting Distribution Regulations, Pay Television Regulations, 1990 and Specialty Services Regulations, 1990 attached to this notice. These amendments were issued for public comment in Public Notice CRTC 2000-150. They will be published in Part II of the Canada Gazette on 14 February 2001 and come into effect on 1 February 2001.

1.

The amendments give effect to the licensing framework policy for new digital pay and specialty services set out in Public Notice CRTC 2000-6.

 

Background

2.

On 7 November 2000, the Commission issued Public Notice 2000-150 calling for comments on proposed amendments to the Broadcasting Distribution Regulations, Pay Television Regulations, 1990 and Specialty Services Regulations, 1990. In particular, the Commission proposed to amend the Broadcasting Distribution Regulations to incorporate the obligations affecting distribution undertakings in relation to digital pay and specialty services licensed pursuant to Public Notice 2000-6.

3.

The Commission also proposed to amend the Pay Television Regulations, 1990 and Specialty Services Regulations, 1990 to prohibit pay and specialty services, respectively, from granting an undue preference or disadvantage similar to the provision applicable to distributors by virtue of the Broadcasting Distribution Regulations.

4.

In reply to this call for comments, the Commission received submissions from 10 interested parties.

 

The Commission's determinations

5.

Having considered the comments received in response to Public Notice 2000-150, the Commission has decided to amend the regulations as proposed, with modifications that:

 
  • extend the 5:1 rule to pay-per-view services approved before 1 January 2000 but not launched as of 1 February 2001,
 
  • permit distributors to carry unrelated pay-per-view and video-on-demand services as part of the five unrelated services that a distributor is obliged to carry under the 5:1 rule.
 
  • replace the word raccordé in the French version of subsection 33.2(1) with the word interconnecté,
 
  • use the expression "sauf condition contraire de leur licence," in a manner consistent with the existing provisions, and
 
  • clarify that Category 1 and Category 2 services are subject to the Specialty Services Regulations, 1990 and the Pay Television Regulations, 1990.

6.

In response to comments received, the Commission has also decided to:

 
  • amend Public Notice 1999-90 Distribution and Linkage Requirements for Class 1 and Class 2 Licensees to incorporatethe policy that distributors will not be permitted to distribute any Category 1 service on a stand-alone basis unless it is also distributed as part of a package, and
 
  • amend the Broadcasting Distribution Regulations, in the context of Public Notice 2000-38 Increasing the availability of minority official language specialty services to cable subscribers across Canada - Call for comments on a proposed policy, to incorporate the requirement set out in Public Notice 2000-6 that distributors ensure that the majority of services received digitally by each subscriber are Canadian.

7.

Many of the comments focused on the scope and application of the 5:1 access rule. The amendments as proposed required cable and DTH distribution undertakings to distribute 5 non-related Category 2 services for each related Category 2 service they distribute. In the amendments as proposed, the obligation to distribute five unrelated services was also triggered when a related pay-per-view or DTH pay-per-view service licensed after 1 January 2000, or a related video-on-demand service is distributed.

8.

The Canadian Cable Television Association (CCTA) submitted that a pay-per-view service licensed before January 1, 2000 but not yet launched should also be considered as a Category 2 service for the purposes of the 5:1 rule. In its submission, no regulatory or policy reason justifies grandfathering such services where video-on-demand services do not receive comparable treatment.

9.

The Commission agrees with this submission and the amendments as adopted treat pay-per-view services approved before January 1, 2000 but not launched as of February 1, 2001 as Category 2 services for the purposes of the 5:1 rule. Thus, the 5:1 rule applies to Category 2 services, video-on-demand services, and pay-per-view and DTH pay-per-view services, the distribution of which begins on or after 1 February 2001. For the purpose of paragraphs 18(13)(b) and (c), the Commission considers that distribution of a service has begun as soon as it is distributed on one system.

10.

Certain parties submitted that if video-on-demand and pay-per-view services are treated as Category 2 services for the purposes of triggering the obligation to distribute 5 unrelated services, these services should also count toward the 5 unrelated Category 2 services that are carried for each related Category 2 service. The Commission agrees with this submission and has revised the amendments to permit distributors to count unrelated pay-per-view and video-on-demand services as part of the five unrelated services that a distributor is obliged to carry under the 5:1 rule.

11.

Corus submitted that the definition of "affiliate" applicable to the 5:1 rule should exclude companies that are, or are controlled by, publicly traded, independently managed companies with distinct directors. The Commission does not agree that excluding such companies would be appropriate. Further, the Commission does not agree with Corus' submission that the 10% ownership level should be increased to 30%.

12.

The Commission agrees with the CCTA's suggestion that for the purpose of defining an independent licensee in the French version of the proposed subsection 33.2(1), the word interconnecté is more appropriate than raccordé. Thus, the Commission has revised subsection 33.2(1) accordingly.

13.

The Commission also agrees with the CCTA's submission that the expression "sauf condition contraire de leur licence" should be used in a manner consistent with the existing regulations. Thus, the Commission has revised the amendments, placing that expression, where it appears, at the beginning of the subsection, rather than at the end.

14.

The Canadian Association of Broadcasters (CAB) submitted that amendments were necessary to specify that the Pay Television Regulations, 1990 and the Specialty Services Regulations, 1990 apply to Category 1 and Category 2 services.

15.

The Commission notes that Category 1 and Category 2 services are approved, and will be licensed, as a category of specialty and pay services. As such, the Pay Television Regulations, 1990 and Specialty Services Regulations, 1990 apply to them. To further clarify this issue, the Commission has decided to revise the amendments to specify that Category 1 and Category 2 services are Canadian programming services designated as such by the Commission. The definition of Canadian programming service explicitly includes specialty services and pay television services.

16.

The CAB submitted that the regulations should include a provision incorporating the policy that distributors will not be permitted to distribute any Category 1 service on a stand-alone basis unless it is also distributed as part of a package, and that each Category 1 service must be packaged and marketed on an equitable basis.

17.

The Commission considers that the undue preference provisions and the industry code dealing with equitable terms of carriage, to be filed for Commission approval by 15 February 2001 pursuant to Public Notice 2000-171, provide the appropriate means for implementing the policy that each Category 1 service must be packaged and marketed on an equitable basis.

18.

The Commission's view is that the policy that distributors will not be permitted to distribute any Category 1 service on a stand-alone basis unless it is also distributed as part of a package should be incorporated in Public Notice 1999-90 Distribution and Linkage Requirements for Class 1 and Class 2 Licensees and will amend Public Notice 1999-90 accordingly.

19.

The CAB submitted that the regulations should include a provision incorporating the requirement set out in Public Notice 2000-6 that distributors ensure that the majority of services received digitally by each subscriber are Canadian.

20.

The Commission agrees that the Broadcasting Distribution Regulations should include such a provision and has decided that it will make this amendment in the context of any amendments that may be proposed following the proceeding initiated by Public Notice 2000-38 Increasing the availability of minority official language specialty services to cable subscribers across Canada - Call for comments on a proposed policy.

21.

The Commission notes the submission that the wording "each specialty service" in paragraph 38(2)(a), setting out the distribution obligations of DTH distribution undertakings in relation to Category 1 and Category 2 services, may cause confusion about whether the carriage obligations extend to Category 1 services.

22.

The Commission considers that Category 1 services are clearly specialty services and no clarification is required.

23.

The Commission disagrees with the submission that section 39, which sets out the television programming services that DTH distribution undertakings may distribute, should specifically authorize distribution of Category 2 services.

24.

DTH distribution undertakings only distribute digital services. Thus, the Commission considers that the broad authorization to carry "any licensed programming undertaking" in subsection 39(a) includes Category 1 and 2 services.

25.

The Commission notes the CAB's request that the Commission extend this process or create an additional process to allow for a comprehensive discussion on the issue of the role of ownership in carriage.

26.

The Commission stated in the Licensing Framework, and reiterated in Public Notice 2000-171, that existing undue preference regulations will address concerns related to the potential for distributors to confer an undue preference on related services in matters such as access, packaging, marketing and other terms of carriage. Moreover, in Public Notice 2000-171, the Commission directed the industry to develop a code dealing with equitable terms of carriage to be filed for Commission approval. The Commission considers that this process will provide a sufficient opportunity to address these issues.

27.

The Commission has decided not to adopt any of the other suggestions made by the parties. Those changes which specifically related to the wording and policy contained in the proposed amendments were, in the Commission's view, neither necessary nor appropriate. Other suggestions were for changes to the proposed regulations that relate to matters being examined in other proceedings (e.g. community television and French programming) and do not address the policy framework for licensing digital specialty and pay services set out in Public Notice 2000-6.

 

Secretary General


 

This document is available in alternate format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca



 

JUS-602107
(SOR/DORS)

 

Whereas, pursuant to subsection 10(3) of the Broadcasting Acta, a copy of the proposed Regulations Amending Certain Regulations Made Under the Broadcasting Act, substantially in the annexed form, was published in the Canada Gazette, Part I, on December 2, 2000 and a reasonable opportunity was thereby given to licensees and other interested persons to make representations to the Canadian Radio-television and Telecommunications Commission with respect to the proposed Regulations;

 

Therefore, the Canadian Radio-television and Telecommunications Commission, pursuant to subsection 10(1) of the Broadcasting Acta, hereby makes the annexed Regulations Amending Certain Regulations Made Under the Broadcasting Act.

 

Hull, Quebec 30 January 2001

 

Secretary General
Canadian Radio-television and Telecommunications Commission


 

_________________
a S.C. 1991, c. 11



JUS-602107
(SOR/DORS)

 

REGULATIONS AMENDING CERTAIN REGULATIONS MADE UNDER THE BROADCASTING ACT

 

pay television regulations, 1990

 

1. Section 6.11 of the Pay Television Regulations, 19902 and the heading1 before it are replaced by the following:

 

Undue Preference or Disadvantage

 

6.1 (1) No licensee shall give an undue preference to any person, including itself, or subject any person to an undue disadvantage.

 

(2) For the purposes of subsection (1), a licensee shall be considered to have given itself an undue preference if the licensee distributes a pay-per-view program for which the licensee has acquired exclusive or other preferential rights.

 

specialty services regulations, 1990

 

2. The Specialty Services Regulations, 19903 are amended by adding the following after section 10:

 

Undue Preference or Disadvantage

 

10.1 No licensee shall give an undue preference to any person, including itself, or subject any person to an undue disadvantage.

 

broadcasting distribution regulations

 

3. Section 1 of the Broadcasting Distribution Regulations4 is amended by adding the following in alphabetical order:

 

"Category 1 service" means a Canadian programming service designated as such by the Commission. (service de catégorie 1)

 

"Category 2 service" means a Canadian programming service designated as such by the Commission. (service de catégorie 2)

 

4. Section 9 of the French version of the Regulations is replaced by the following:

 

9. Il est interdit au titulaire d'accorder à quiconque, y compris lui-même, une préférence indue ou d'assujettir quiconque à un désavantage indu.

 

5. (1) Subsection 18(1) of the Regulations is replaced by the following:

 

18. (1) Except as otherwise provided under a licensee's condition of licence, this section applies to Class 1 licensees.

 

(1.1) Except as otherwise provided under a licensee's condition of licence, subsections (4), (4.1) and (11) to (14) apply also to Class 2 licensees.

 

(2) Subsection 18(3) of the Regulations is replaced by the following:

 

(3) For the purposes of this section, other than subsection (11), a licensee makes use of digital technology for the delivery of programming to subscribers when at least 15% of its subscribers receive one or more programming services on a digital basis.

 

(3) Section 18 of the Regulations is amended by adding the following after subsection 4:

 

(4.1) For the purposes of subsection (5)

 

(a) a specialty service does not include a Category 1 or Category 2 service; and

 

(b) a pay television service does not include a Category 2 service.

 

(4) Section 18 of the Regulations is amended by adding the following after subsection (10):

 

(11) Except as otherwise provided under a condition of its licence, a licensee that delivers any programming service to any subscriber on a digital basis shall distribute, on a digital basis,

 

(a) if the licensee is operating in an anglophone market, each English-language Category 1 service that the operator of which is authorized to provide to all or part of the licensed area of the undertaking; and

 

(b) if the licensee is operating in a francophone market, each French-language Category 1 service that the operator of which is authorized to provide to all or part of the licensed area of the undertaking.

 

(12) The definitions in this subsection apply in this subsection and subsection (14).

 

"affiliate" has the same meaning as in subsection 21(2). (affiliée)

 

"control" has the same meaning as in subsection 21(2). (contrôle)

 

"related programming undertaking" means a programming undertaking of which the licensee or an affiliate, or both, controls more than 10% of the total shares issued and outstanding. (entreprise de programmation liée)

 

"share" has the same meaning as in subsection 21(2). (action)

 

(13) For the purposes of subsection (14), "Category 2 service" includes

 

(a) a video-on-demand service;

 

(b) a pay-per-view service, distribution of which began on or after February 1, 2001; and

 

(c) a DTH pay-per-view service, distribution of which began on or after February 1, 2001.

 

(14) Except as otherwise provided under a condition of its licence, a licensee shall, for each Category 2 service of a related programming undertaking distributed by the licensee, distribute at least five Category 2 services of any unrelated programming undertakings.

 

6. The Regulations are amended by adding the following after the heading before section 19:

 

18.1 For the purposes of section 19

 

(a) a pay television service does not include a Category 2 service; and

 

(b) a specialty service does not include a Category 1 or Category 2 service.

 

7. The Regulations are amended by adding the following after section 19:

 

19.1 Except as otherwise provided under a condition of its licence, a licensee that delivers any programming service to any subscriber on a digital basis and satisfies the requirements of section 18 may distribute, but only on a digital basis, any Category 1 service not distributed by the licensee under that section, and any Category 2 service

 

8. Section 31 of the Regulations is replaced by the following:

 

31. Except as otherwise provided under a licensee's condition of licence, this Part and subsections 18(12) to (14) apply to Class 3 licensees.

 

9. The Regulations are amended by adding the following after the heading before section 33:

 

32.1 For the purposes of section 33

 

(a) a pay television service does not include a Category 2 service; and

 

(b) a specialty service does not include a Category 1 or Category 2 service.

 

10. The Regulations are amended by adding the following after section 33:

 

33.1 Except as otherwise provided under a condition of its licence, a licensee that delivers any programming service on a digital basis to any subscriber may distribute, but only on a digital basis, any Category 1 or Category 2 service.

 

33.2 (1) For the purpose of subsection (2), an independent licensee is a Class 3 licensee whose distribution system is not interconnected with a distribution system of either a Class 1 or Class 2 licensee.

 

(2) An independent licensee that does not deliver any programming service to any subscriber on a digital basis may distribute any Category 1 service on an analog basis.

 

11. Section 36 of the Regulations is replaced by the following:

 

36. This Part and, except as otherwise provided under a licensee's condition of licence, subsections 18(12) to (14) apply to licensees that hold a licence to operate a DTH distribution undertaking.

 

12. Paragraphs 38(2)(a) and (b) of the Regulations are replaced by the following:

 

(a) each specialty service, not including a Category 2 service or a single or limited point-of-view religious specialty service;

 

(b) each pay television service, not including a Category 2 service or a single or limited point-of-view religious pay television service;

 

coming into force

 

13. These Regulations come into force on February 1, 2001.

 

__________________
1 SOR/99-455
2 SOR/90-105
3 SOR/90-106
4 SOR/97-555

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