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Public Notice
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Ottawa, 31 January 1990
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Public Notice CRTC 1990-11
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REGULATIONS RESPECTING SPECIALTY SERVICES TELEVISION NETWORKS
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Related Documents: Public Notice CRTC 1988-173 dated 27 October 1988, Public Notice CRTC l 989-62 dated 6 June 1989.
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I.INTRODUCTION
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Between 1984 and 1987 the Commission has licensed twelve specialty service networks which are currently in operation.
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The Commission has previously set out in conditions of licence the regulatory obligations of the licensees of specialty services networks. In light of the number of Canadian specialty networks now licensed and the similar requirements they face, the Commission has decided that it would be appropriate to introduce regulations to deal with this class of undertakings. These regulations, called the Specialty Services Regulations, 1990, include the provisions of the Television Broadcasting Regulations, 1987 that were incorporated by reference into specialty network licences, as well as other relevant provisions.
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The regulations provide a standard framework under which all specialty services networks will operate. They address such matters as programming content, political broadcasts, logs and records, and the transfer of ownership or control of the undertaking.
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With the enactment of these regulations, both specialty services networks and television networks available off-air will be subject to similar regulatory requirements.
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In Public Notice CRTC l 989-62, dated 6 June 1989, the Commission set out the proposed regulations for public comment. Comments were originally due on l8 July 1989 but this deadline was extended to l8 August 1989.
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The Commission received a total of l7 written comments from the following parties: Joseph E. Seagram and Sons Limited (Seagrams), National Film Board of Canada (NFB), the Government of British Columbia, Friends of Canadian Broadcasting, Vision/TV (Vision), Canadian Film and Television Association, Israel Switzer, the Government of Ontario, the Government of Nova Scotia, First Choice Canadian Communications Corporation (First Choice), Allarcom Pay Television Limited (Allarcom), Premier Choix: TVEC Inc. (SuperEcran), The Canadian Association of Broadcasters (CAB), MuchMusic Network, The Sports Network (TSN), YTV Canada Inc. (YTV), and the Canadian Broadcasting Corporation (CBC).
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The Commission wishes to acknowledge the important contribution made by all submissions. The opinions and expertise reflected in the submissions played a significant role in the Commission's final determination of the new regulations.
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II. CHANGES TO THE PROPOSED REGULATIONS
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As a result of the comments received, the Commission has made a number of changes to the draft regulations. These changes are highlighted below.
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(i)Programming Content
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The proposed regulations prohibited a licensee from distributing a commercial message which advertises an alcoholic beverage in provinces where this type of advertising is prohibited.
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TSN submitted that the obligation to meet the advertising restrictions of ten provincial jurisdictions is too onerous. CBC submitted that the deletion of commercials from satellite broadcasts of programming would not be technically or practically feasible.
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The Commission appreciates the difficulties faced by specialty network licensees who distribute programming service by satellite and has therefore decided to amend this paragraph to prohibit the advertising of alcoholic beverages, only if such advertising is prohibited by the laws of the province from which the licensee's transmission of the commercial message originates.
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(ii)Requests for Information
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The proposed regulations stated that a licensee shall retain a clear and intelligible audio-visual recording of all its programs for a period of four weeks after the date of distribution. SuperEcran, licensee of Canal Famille, commented that this provision is unnecessary since it could obtain a copy of its programs from suppliers if necessary.
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The Commission notes that it must ensure that a licensee is providing the Commission with an exact copy of the program which was distributed and should not have to depend on a third party to make this information available. This requirement therefore remains unaltered in the regulations.
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The proposed regulations stated that a licensee, at the request of the Commission, shall respond to any complaint regarding programming or any other matter that the Commission wishes to investigate.
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The CBC suggested that this provision was too wide and expressed concern that it might be compelled to respond to any inquiry made of it by any person on any matter, or face a court case, possible conviction and subsequent fine.
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The Commission notes that the requirement set out in the proposed regulations would be triggered by a Commission request and not by the filing of any complaint or inquiry. The Commission wishes to emphasize that licensees will be required to address only those matters which the Commission has been mandated to regulate and supervise, in accordance with the Broadcasting Act. The proposed section has been reworded to reflect this position.
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(iii) Transfer of Ownership and Control
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The section of the regulations dealing with transfers of ownership or control has also been modified in order to make it consistent with the section of the Pay Television Regulations, 1990 dealing with transfers of ownership or control.
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The Commission is of the view that consistent treatment is appropriate since these services raise similar concerns with respect to vertical integration. Specifically, the Commission notes that, in both cases, licensees must rely on cable systems for distribution.
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The Commission has carefully reviewed the provisions relating to the transfer of ownership and control which were set out for public comment in the proposed pay television regulations and has decided to modify, in light of the current broadcasting environment, its regulation of transfers of ownership and control.
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Specifically, this provision has been modified to require licensees to obtain the Commission's approval for the acquisition of more than l0% of the issued voting shares of the licensee or a controlling company by a person already controlling a cable company or other exhibitor of specialty services.
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The Commission notes that this new provision will apply to future acquisitions only.
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(iv)Schedule I
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(a)Target Audience
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The proposed regulations included a number of different target audience classifications which were to be included in the key figure used in the program log or machine-readable record of programming to describe the program distributed. YTV commented that the classifications appeared to be more numerous than necessary to accord with either their own target audience or those of any other specialty network.
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The Commission has reviewed the relevant conditions of licence and has removed the classifications for Children (2 to ll years) and Youth (l4 to l7 years).
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With respect to the logging of target audiences, the Commission wishes to remind the licensees that the key figures are used to monitor compliance with conditions of licence and that only a single target audience, corresponding where appropriate to a requirement set out in the conditions, need be identified for each program.
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Additionally, since not all licensees are obliged to distribute programs which have a specific provincial film classification, this requirement has been removed from the regulations as well. However, those licensees who may distribute feature films falling within one or more film classifications should provide in the program log a notation of the classification of each film.
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The Commission reminds licensees that the code letters for the language and type or group of the program set out in Column I of Schedule II are to be logged only if they are relevant to a licensee's conditions of licence.
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(b)Categories
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The NFB commented that the exclusion of the term "Documentary" from the "Categories" section of Schedule I may have a detrimental effect on the ultimate use of this genre of programming. The Commission continues to encourage licensees to distribute all types of under-represented programming; however, after carefully reviewing this section, the Commission believes that documentary programs can be adequately logged under the existing categories.
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The proposed regulations included a program category for tele-merchandising. The Provinces of Ontario and Nova Scotia commented that the inclusion of this category would appear to suggest tele-merchandising may be considered a program.
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The Commission's purpose in including telemerchandising as a program category was to ensure that such programming was identified in the program logs submitted by the specialty services network licensee who distributes such material. Since this licensee must log advertising material in accordance with subparagraph 7(1)(c)(iii) of the regulations and is obliged by condition of licence to indicate the type of advertising material, the Commission agrees that telemerchandising need not be reflected in the key figure.
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III.OTHER MATTERS
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The Commission received a number of comments which related to matters presently dealt with in specific conditions of licence of specialty service network licensees. The Commission wishes to emphasize that the regulations set out requirements that apply to all licensees falling within the same class. The Commission may amend a licensee's conditions of licence only upon application by the licensee during the term of the licence or at renewal.
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IV.IMPLEMENTATION
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As noted above, the Commission has previously set out in conditions of licence the regulatory requirements which are now found in the Specialty Services Regulations, 1990. In addition, as outlined in Circular No. 369, the Commission has introduced in the regulations new logging requirements for licensees of specialty services networks. In order to phase in the new logging procedures, the Commission has provided that the requirement to use the new key figure will not take effect until 1 September 1990. Until that time, licensees will be subject to existing requirements which direct them to follow the logging requirements contained in section 10 of the Television Broadcasting Regulations, 1987. Licensees are invited to apply to the Commission to remove, as of 1 September 1990, any requirements relative to the use of the categories contained in the television regulations, that are set out in conditions of licence. Licensees are also invited to apply to amend their licences to remove any requirements that will now be found in the Specialty Services Regulations, 1990. In most cases, these include the provisions now set out in sections 3, 4, 5, 6, 9 and 10 of the new regulations. In the absence of such applications, licensees will be subject to both sets of requirements, with the attendant enforcement mechanisms.
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The changes discussed in this document are reflected in the revised text of the regulations attached to this Public Notice. This document will be registered and published in the Canada Gazette.
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Fernand Bélisle
Secretary General
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