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Speaking Notes

for Konrad von Finckenstein, Q.C.

Chairman
Canadian Radio-television and Telecommunications Commission

to the 15th Biennial National Conference of the Law Society of Upper Canada

Panel on "Judicial Review of Communications and Copyright Regulation in Canada"

April 23, 2010

(Check against delivery)

Good morning.

I’m delighted to have been invited to talk about my views on judicial review in general, and more specifically about the introduction to Peter’s book [Peter Grant, Communications Law and the Courts in Canada]. On the whole, I agree with much of what he has written, with one exception.

Need for unified legislation

In his paper, Peter writes that the existing legislation continues to be effective and the time is not yet right for a single Act. I’m sorry, Peter, but I have to disagree with you on this point.

Last week, I appeared before the Standing Committee on Industry, Science and Technology. One of the things I told the Committee members was that we desperately need a unified approach for telecom, broadcasting and radiocommunications.

The current piecemeal approach is outdated and no longer up to the task. It no longer makes sense to apply different rules to a converged company’s telecom and broadcasting activities. It makes even less sense to have a different body responsible for spectrum and wireless communications. We need to break down these legislative distinctions, which are becoming increasingly artificial, and develop a comprehensive approach to communications.   

But that is a discussion for another day, and I am sure we will have plenty of opportunities to discuss them. We are here to discuss judicial decisions affecting communications and copyright. I can speak on this topic based on my experience at the CRTC and as a former justice. Let me start with the CRTC.

CRTC decision-making process

Both the Telecommunications and the Broadcasting Act give large discretionary powers to the CRTC. They basically set broad policy objectives such as:

  • Private networks and programming undertakings should, to an extent consistent with the financial and other resources available to them,

    i. contribute significantly to the creation and presentation of Canadian programming, and

    ii. be responsive to the evolving demands of the public.

But how these objectives should be reached is left to the CRTC. This, in effect, gives us quite a large ambit. Our decisions have the potential to materially affect the welfare of the companies we regulate.

We are acutely aware of the prospect of having our decisions appealed to the courts. The existence of court review means that, in every decision, we carefully examine whether due process was followed (i.e., were the proper questions asked, is the record complete, did everyone have a chance to comment, are our conclusions supported by the evidence, is our rationale clearly set out in the decision, etc.).

I can honestly say that I pay more attention to due process at the CRTC than I ever did in all my years in various government departments or as Commissioner of Competition.

We also appreciate that we regulate a communications environment that is increasingly competitive, where all players are looking for an edge over their competitors. Consequently, our decisions are closely scrutinized and more of frequently challenged. I expect that in the future these challenges will only increase given the dynamic nature of the industry, the wide latitude of discretion we have and the potential impact of our decisions.

Our record in court

As you know, the CRTC’s decisions are subject to appeal, with leave, on errors of law or jurisdiction. The underlying facts of a decision are not subject to court review.

Each year, the CRTC issues hundreds of decisions. Very few of these are ever challenged. As you can read in Peter’s book, only 104 CRTC decisions have gotten past the leave stage and 88 of them have been upheld by the courts. This puts our success rate at about 85%.

We have taken the following steps to ensure, as much as possible, that the majority of our decisions won’t be challenged:

  • We devised our processes as openly and transparently as possible.
  • We make sure our decisions are based on the public record, which will not make for conclusions that are unsupported by the record.
  • If the record is incomplete, or if all relevant facts were not canvassed, we will launch a follow-up proceeding to obtain the necessary information.
  • We have established elaborate guidelines to ensure our discussions with the industry do not give rise to a conflict of interest or bias, or the appearance thereof.
  • By and large, we take a very conservative approach with respect to the scope of our jurisdiction.

Let me give you a practical example. Once a hearing is set, as a rule I will not meet with industry representatives who are likely to appear before me. Where it is absolutely necessary for an issue unrelated to the upcoming hearing, I will do so only after there is prior written agreement on the subject to be discussed and I will always ensure that I have a witness at such meetings.

This may sound overly protective, but it will certainly allow us to counter any allegation of perceived bias or violation of procedural fairness.

Key judicial decisions

Judicial decisions have been very useful in defining the boundaries of the CRTC’s jurisdiction. Let me just mention three.

  • Barrie Public Utilities: In 2003, the Supreme Court of Canada found that the Commission did not have authority to set rates charged by power companies to telecom and cable carriers for access to their utility poles. This ruling clearly marked the limit of the CRTC’s power under the Telecommunications Act.
  • CHOI-FM: In 2005, the Federal Court of Appeal upheld the CRTC’s decision not to renew the licence of CHOI-FM for its on-air commentary, which was not in compliance with the CRTC-approved code of ethics. This important ruling confirmed our discretionary powers to renew or not renew a broadcasting licence. The Supreme Court later denied leave to appeal this decision.
  • Deferral accounts: Last year, the Supreme Court upheld our decision regarding the distribution of the funds that had accumulated in the deferral accounts. The Supreme Court deferred to the CRTC’s expertise in rate-related matters and reaffirmed our broad authority to regulate the rates of telecommunications services.

References to the Federal Court of Appeal

We have also turned to the Federal Court of Appeal to get clarity on important legal issues. The ability to obtain a timely ruling from the court is useful, particularly for issues that have wide-ranging implications and where time is of the essence.

We have now sent three references to the Federal Court of Appeal:

1. The first was to clarify whether the User Fees Act applied to the amendments we proposed to make to the Telecommunications Fees Regulations. In this case, the Court ruled that the User Fees Act did not apply since the telecom fees do not provide fee-payers with a “direct benefit or advantage.” As a result, we were able to amend the regulations, ensuring cable companies also bear part of the cost of telecom regulation. This amendment came into force at the beginning of April.

2. Further to our New Media decision, we asked the Court whether the Broadcasting Act applies to Internet service providers (ISPs) to the extent that they provide access to broadcasting content. A hearing has been set for the beginning of June. The resulting decision will determine whether any part of the activities of ISPs fall under the ambit of the Broadcasting Act.

3. And in the context of our recent television policy based on ownership groups, we were faced with two conflicting legal opinions. So we asked the Court whether we have the authority to implement a regime allowing conventional TV stations to negotiate with distributors for the fair value of their programming. The hearing will take place sometime in September and hopefully settle this long-running and contentious issue.

We firmly believe that the use of references is a quick way to bring certainty and added clarity regarding the reach of the CRTC’s mandate. It may well be that there are limitations that will require legislative action. However, once the ruling comes down, the CRTC, industry and government will at least know the exact extent of our jurisdiction.

Standard of review

I know from my own brief experience on the bench that it is not always easy to conduct a judicial review. While the legal questions were usually well defined, a clear explanation of the administrative body’s internal mechanisms and procedures, as well as a description of the types of issues coming before the tribunal, was often missing from the materials. Yet without that type of information, it is difficult for the judge to get a feel for the work of the tribunal and make the appropriate decision about the standard of review.

The advice I give my counsel and which you may also wish to follow is: Make sure you provide enough context and background in your memorandum of fact and law, so that someone with no knowledge of the organization involved (i.e., the judge) can understand the challenges the tribunal faces and how it performs its functions.

Conclusion

In conclusion, I’d like to thank Peter for writing this book. The extensive research he conducted, the references to unpublished decisions and the table of concordance between former and present statutes make his book a useful and much-needed tool for lawyers in our field.

Reading most of Peter’s book – I won’t pretend that I read it all – led me to reflect on and realize what a useful function court review of CRTC decisions actually performs. It is an effective way to keep the system flexible but disciplined for all participants.

Thank you.

Date Modified: 2010-04-26

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