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Public Notice
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Ottawa, 30 September 1986
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Public Notice CRTC 1986-273
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Société de radio-télévision du Québec
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Related document: Decision CRTC 85-609 dated 31 July 1985.
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In Public Notice CRTC 1986-202 dated 11 August 1986, the Commission invited interested parties to submit comments on amendments the Société de radio-télévision du Québec (Radio-Québec) proposed to make to its Advertising Code. These amendments would eliminate the restrictions on mentioning the retail price of a product or service and on accepting for broadcast commercial messages for beer, wine and cider products. The Commission indicated in its Public Notice that it would like to receive comments before rendering a decision on the proposed amendments and, in the meantime, it expected Radio-Québec to maintain its advertising policy in accordance with the standards and criteria for the sale of air-time contained in its Advertising Code dated 28 October 1985.
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Background
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This Advertising Code was submitted to the Commission by Radio-Québec following Decision CRTC 85-609 in which the Commission renewed Radio-Québec's licences until 30 September 1990. In its renewal application, the licensee had stated that an increase in its independent renevue was necessary for its development and it proposed to broaden the range of the kinds of advertising it would broadcast. As required by the Commission at the 13 May 1985 Public Hearing in Montreal, the licensee submitted a statement to the Commission, dated 12 June 1985, setting forth its policy on the broadcast of restricted advertising, in which it [TRANSLATION] "undertakes during the period covered by this application for the renewal of our licences, to abide by following rules:
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1) Radio-Québec will avoid interrupting its programs with commercial announcements; such announcements will be grouped at the beginning and end of programs;
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2) In certain cases, commercial announcements may be broadcast during programs, but only where natural pauses occur, and only where they do not interrupt the natural flow of a program;
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3) The time devoted to the broadcast of commercial announcements will not exceed six minutes per hour; this includes Radio-Québec's own station and network promotion;
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4) Commercial announcements will only be aired on a network basis;
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5) Only the network will be permitted to sell air-time for commercial announcements. On a regional basis, individual stations will only be permitted to solicit prestige sponsorship."
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This statement also set out a number of specific guidelines restricting the content of commercial messages, particularly by prohibiting the mention of retail price and free gifts.
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Accordingly in light of the experimental nature of the licensee's proposals and its commitments in this regard, in Decision CRTC 85-609, the Commission approved Radio-Québec's advertising proposals subject to the following condition: that "local advertising, except in Montreal, [would] be limited to prestige sponsorship and the exchange of services." As suggested by Radio-Québec, the Commission also indicated that it intended to review with the licensee, at the end of two years, its advertising policies and their impact. The Commission also expected the licensee to submit, within three months of the date of the decision, a statement to be placed on the public file with respect to the standards and criteria which Radio-Québec would follow regarding the sale of airtime. This was done on 28 October 1985.
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The October statement continued to prohibit the mention of retail price and free gifts but it indicated that Radio-Québec would accept prestige sponsorship messages on tobacco, alcohol, beer, wine and cider products as well as games and lotteries.
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On 24 March 1986, Radio-Québec submitted a new version of its Advertising Code and proposed to eliminate the restriction against mentioning the retail price of a product or service and to accept for broadcast commercial announcements on beer, wine and cider products. The licensee indicated its intention that these amendments would be effective as of 1 June 1986.
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Comments Received
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In response to Public Notice CRTC 1986-202, the Commission received comments from Télévision de la Baie des Chaleurs Inc. (CHAU-TV), licensee of television stations serving the Gaspé and Baie des Chaleurs, and a submission from Radio-Québec. CHAU-TV opposed Radio-Québec's proposals on the grounds that a number of regional television stations, including its own, had seen a significant decrease in their sales of national selective advertising since Radio-Québec had moved into the advertising market.
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Radio-Québec, on the other hand, pointed out in its submission that the proposed amendments to its Advertising Code which had been called into question by the Commission had already been put into effect. It argued that, based on an analysis of the potential repercussions of withdrawing these changes, it had concluded that this would necessitate reneging on contracts that it had negotiated with its clients in good faith, reverting to inadequate and ineffectual market guidelines particularly with respect to mentioning the price of goods and services and giving up significant sources of revenue that it required to meet its objectives. Radio-Québec also justified these amendments by arguing that, except for the five basic rules which it had promised to follow, the other criteria were [TRANSLATION] "internal guidelines ---- which could be changed by Radio-Québec without formality according to the circumstances." The licensee also indicated that it had received very little negative feedback from its viewers in this regard and requested that examination of this issue be postponed until the end of the two-year experimental period.
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The Commission's Position
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The Commission considers that the lifting of the existing restriction on mentioning the price of a product or service and the acceptance of commercial announcements for beer, wine and cider products constitute major and very significant amendments to the standards and criteria which had been placed on the public file on 28 October 1985 by Radio-Québec. The Commission had, in effect, accepted for an experimental two-year period a regulatory framework proposed by Radio-Québec which did not refer to amendments of this type. Further, the standards and criteria that Radio-Québec filed following the renewal decision also did not include the amendments now proposed. The Commission expects that the advertising practices of Radio-Québec will conform to these standards and criteria during the two-year experimental period. The Commission is particularly concerned about the possible repercussions of these changes on other broadcasters and on the broadcasting system in general, as well as its potential impact on the nature of Radio-Québec's programming, both on a short- and long-term basis.
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In view of the fact that these two changes constitute major amendments that were not discussed at the May 1985 hearing and because they exceed the provisions of the code submitted by Radio-Québec in October 1985, the Commission advises the licensee that if it wishes to maintain the amendments proposed on 24 March 1986, the Commission will request Radio-Québec to appear at a Public Hearing in order that these matters may be examined in a broader context. In view of the present notice, the licensee should inform the Commission within thirty days of its intentions.
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Meanwhile, the Commission expects the licensee to maintain its advertising policy in accordance with the standards and criteria contained in its Advertising Code dated 28 October 1985.
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Fernand Bélisle Secretary General
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