ARCHIVED -  Public Notice CRTC 1995-114

Public Notice

Ottawa, 11 July 1995

Public Notice CRTC 1995-114

CALL FOR APPLICATIONS FOR LICENCES TO CARRY ON NEW DIRECT-TO-HOME (DTH) SATELLITE DISTRIBUTION UNDERTAKINGS AND NEW DTH PAY-PER-VIEW (PPV) TELEVISION PROGRAMMING UNDERTAKINGS

On 6 July 1995, the Government released the attached Orders-in-Council P.C. 1995-1105 and 1995-1106 (the Orders) which provide directions to the CRTC concerning the licensing of DTH Satellite Distribution Undertakings and DTH PPV Television Programming Undertakings respectively.

The Orders require the Commission, immediately on the coming into force of the Orders, to call for licence applications. The Commission hereby calls for licence applications for new DTH Satellite Distribution Undertakings and new DTH PPV English-language and French-language Television Programming Undertakings.

Taking into consideration the timetable envisioned by the Government, but mindful as well of the requirements of the Broadcasting Act, the principles of procedural fairness and the number of undertakings and persons that may be affected by or may wish to participate in these proceedings, the Commission has decided to specify a 45-day period for interested parties to file applications in response to this call, rather than a 90-day period which would be consistent with past practice in similar matters.

Accordingly, applications for DTH Satellite Distribution Undertakings and DTH PPV Television Programming Undertakings must be filed with the Secretary General of the Commission on or before 25 August 1995.

Applicants are advised that they may apply for either of these two types of DTH satellite undertakings. At a later date, the Commission will announce details of a public hearing which will be scheduled to consider applications received in response to this call.

In preparing their applications, prospective applicants are referred to the stipulations found in the attached Orders.

In addition, applicants will be required to meet the eligibility requirements set out in the Consolidated Regulations of Canada, 1978, Chapter 376 (Eligible Canadian Corporations) and in P.C. 1985-2108 dated 27 June 1985 (Ineligibility to hold broadcasting licences). Documentation that provides full and complete details regarding the proposed ownership and control of the undertaking will be required.

The Commission will consider an application to be incomplete unless it includes a detailed business plan, including financial projections of revenues, expenses, capital costs and a statement of changes in financial position for the pre-operating period and each of the seven (7) years of the proposed licence term. A balance sheet as at the beginning of year 1 and as at the end of year 7 along with all of the underlying assumptions used to prepare the projections must also be provided.

In addition, the application must also contain documentary evidence demonstrating that, should the application be successful, all of the proposed funding within the business plan will be unequivocally available on or before the date the Commission renders its decision on the application. Detailed guidelines outlining the documentation necessary to support the unequivocal availability of an applicant's financing are available from the Commission on request.

Allan J. Darling
Secretary General

WHEREAS all classes and types of satellite broadcasting undertakings play a significant role in the implementation of the broadcasting policy for Canada set out in subsection 3(1) of the Broadcasting Act;

WHEREAS DTH distribution undertakings will become increasingly important primary and alternative means for the distribution of Canadian programming services, in both official languages, as well as of foreign programming services to subscribers in all parts of Canada;

WHEREAS DTH distribution undertakings can, if appropriately regulated, develop into an important vehicle for the distribution of Canadian pay-per-view services as well as other new services and thereby make significant contributions to the development of independently-produced Canadian programming;

WHEREAS DTH distribution undertakings should operate through licensing in a dynamically competitive market, subject to appropriate requirements, including their contribution to the development of programming, in order to provide pay-per-view services and other Canadian and foreign programming services in competition with each other and with other distribution undertakings that provide programming services to Canadians;

WHEREAS the Canadian Radio-television and Telecommunications Commission should not refuse to issue a DTH distribution undertaking licence on the basis of a concern for economic viability;

WHEREAS the contribution of DTH distribution undertakings should include a financial contribution of more than five per cent of gross annual revenues to the production of Canadian programming;

WHEREAS it is in the public interest to have DTH distribution undertakings licensed in Canada as soon as possible, recognizing that the appropriate committee of each House of Parliament has recommended that the licensing process be completed by September 1, 1995;

WHEREAS the Canadian Radio-television and Telecommunications Commission should ensure the continuing integrity of the Canadian broadcasting system through implementation of the broadcasting policy set out in subsection 3(1) of the Broadcasting Act*;

WHEREAS, the Minister of Communications has, in accordance with subsection 7(6) of the Broadcasting Act*, consulted with the Canadian Radio-television and Telecommunications Commission;

WHEREAS, in accordance with paragraph 8(1)(a) of the Broadcasting Act*, notice of the proposed Order issuing directions to the Canadian Radio-television and Telecommunications Commission respecting policy for the licensing of Direct-to-Home (DTH) Satellite Distribution Undertakings, substantially in the form annexed hereto, was published in the Canada Gazette Part I on April 29, 1995 and interested persons were invited to make representations to the Minister of Communications with respect to the proposed Order;

AND WHEREAS, in accordance with paragraph 8(1)(b) of the Broadcasting Act*, a copy of the proposed Order was laid before each House of Parliament and forty sitting days of Parliament have since expired;

THEREFORE, HIS EXCELLENCY THE GOVERNOR GENERAL IN COUNCIL, on the recommendation of the Minister of Communications, pursuant to section 7 and subsection 8(3) of the Broadcasting Act*, is pleased hereby to make the annexed Order issuing directions to the Canadian Radio-television and Telecommunications Commission respecting policy for the licensing of Direct-to-Home (DTH) Satellite Distribution Undertakings.

JUS-95-235-02 (SOR/DORS)

ORDER ISSUING DIRECTIONS TO THE CANADIAN RADIO-TELEVISION AND TELECOMMUNICATIONS COMMISSION RESPECTING POLICY FOR THE LICENSING OF DIRECT-TO-HOME (DTH) SATELLITE DISTRIBUTION UNDERTAKINGS

Short Title

1. This Order may be cited as the Directions to the CRTC (Direct-to-Home (DTH) Satellite Distribution Undertakings) Order.

Interpretation

2. In this Order,

"CRTC" means the Canadian Radio-television and Telecommunications Commission; (CRTC)

"DTH distribution undertaking" means a Direct-to-Home (DTH) Satellite Distribution Undertaking; (entreprise de distribution par SRD)

"DTH pay-per-view television programming undertaking" means a pay-per-view television programming undertaking licensed to provide pay-per-view services for distribution to subscribers through a licensed DTH distribution undertaking; (entreprise de programmation de télévision à la carte par SRD)

"other distribution undertakings" includes cable distribution, Satellite Master Antenna Television (SMATV) and radiocommunication distribution undertakings that are licensed or exempted by the CRTC from the requirement for a licence under section 9 of the Broadcasting Act; (autres entreprises de distribution)

"pay-per-view television programming undertaking" means a pay television programming undertaking that provides a pay-per-view service. (entreprise de programmation de télévision à la carte)

Directions

3. The CRTC is directed to promote, through licensing, a dynamically competitive market for DTH distribution undertakings.

4. The CRTC is directed to ensure, by appropriate means, that, with respect to the operation of a licensed DTH distribution undertaking,

(a) substantially the same rules that are in effect for other distribution undertakings govern the
selection of particular Canadian and foreign programming services that are offered by the
undertaking to its subscribers;

(b) the undertaking is subject to the same generally applicable Canadian policy as other
broadcasting undertakings in respect of the use of Canadian and foreign satellite facilities;

(c) the undertaking is subject to equitable obligations and makes maximum contributions to
Canadian programming, including a significant financial contribution derived from a percentage
of gross annual revenues to the production of Canadian programming, and that the financial
contribution is administered independently of the undertaking;

(d) the undertaking is not prevented from or impeded in distributing to its subscribers the same
or equivalent programming services offered by other distribution undertakings as a result of
contracts or arrangements entered into by other licensees for the acquisition of rights to the
distribution or exhibition of such programming services via other distribution undertakings within
Canada;

(e) the undertaking is prohibited from distributing any pay-per-view service other than that
offered by a DTH pay-per-view television programming undertaking;

(f) the undertaking is not prohibited from distributing a pay-per-view service referred to in
paragraph (e) for the sole reason that a foreign satellite is to be used for the distribution of the
non-Canadian programming of that pay-per-view service, provided that such use is consistent
with generally applicable Canadian satellite policy; and

(g) where the undertaking decides to distribute one or more English-language pay-per-view
services, the undertaking is required to distribute at least one French-language pay-per-view
service as soon as that service becomes licensed for DTH distribution.

5. The CRTC is directed

(a) not to authorize any person or class of persons to carry on a DTH distribution undertaking
other than by means of a licence issued by the CRTC for that purpose; and

(b) following the conclusion of the licensing process referred to in section 7, to take all
necessary and appropriate steps to ensure that no person is authorized to carry on a DTH
distribution undertaking by any means other than a licence.

6. The CRTC is directed not to refuse to issue a licence to an applicant to carry on a DTH distribution undertaking for the sole reason that the applicant holds a licence to carry on a DTH pay-per-view television programming undertaking.

7. The CRTC is directed to call, immediately on the coming into force of this Order, for licence applications to carry on DTH distribution undertakings and, thereafter, to complete the licensing process in respect of those applications at the earliest time practicable and, in the absence of the most compelling of circumstances, not later than November 1, 1995.

JUS-95-239-02 (SOR/DORS)

WHEREAS pay-per-view services will become an increasingly important vehicle for the exhibition of feature films and other television programming and an increasingly important source of financial contribution to the development of independently-produced Canadian programming;

WHEREAS pay-per-view television programming undertakings should operate through licensing in a dynamically competitive market, subject to appropriate requirements, including their contribution to the development of programming, in order to provide to their subscribers, in competition with each other, the widest range of Canadian and foreign feature films and other programming;

WHEREAS the Canadian Radio-television and Telecommunications Commission should not refuse to issue a DTH pay-per-view television programming undertaking licence on the basis of a concern for economic viability;

WHEREAS the contribution of DTH pay-per-view television programming undertakings should include a financial contribution of more than five per cent of gross annual revenues to the production of Canadian programming;

WHEREAS the Canadian Radio-television and Telecommunications Commission should ensure the continuing integrity of the Canadian broadcasting system through implementation of the broadcasting policy set out in subsection 3(1) of the Broadcasting Act;

WHEREAS, in accordance with subsection 7(6) of the Broadcasting Act*, the Minister of Communications has consulted with the Canadian Radio-television and Telecommunications Commission;

WHEREAS, in accordance with paragraph 8(1)(a) of the Broadcasting Act*, notice of the proposed Order issuing directions to the Canadian Radio-television and Telecommunications Commission respecting policy for the licensing of pay-per-view television programming undertakings that provide services through Direct-to-Home (DTH) Satellite Distribution Undertakings, substantially in the form annexed hereto, was published in the Canada Gazette Part I on April 29, 1995 and interested persons were invited to make representations to the Minister of Communications with respect to the proposed Order;

AND WHEREAS, in accordance with paragraph 8(1)(b) of the Broadcasting Act*, a copy of the proposed Order was laid before each House of Parliament and forty sitting days of Parliament have since expired;

THEREFORE, HIS EXCELLENCY THE GOVERNOR GENERAL IN COUNCIL, on the recommendation of the Minister of Communications, pursuant to section 7 and subsection 8(3) of the Broadcasting Act, is pleased hereby to make the annexed Order issuing directions to the Canadian Radio-television and Telecommunications Commission respecting policy for the licensing of pay-per-view television programming undertakings that provide services through Direct-to-Home (DTH) Satellite Distribution Undertakings.

JUS-95-239-02 (SOR/DORS)

ORDER ISSUING DIRECTIONS TO THE CANADIAN RADIO-TELEVISION AND TELECOMMUNICATIONS COMMISSION RESPECTING POLICY FOR THE LICENSING OF PAY-PER-VIEW TELEVISION PROGRAMMING UNDERTAKINGS THAT PROVIDE SERVICES THROUGH DIRECT-TO-HOME (DTH) SATELLITE DISTRIBUTION UNDERTAKINGS

Short Title

1. This Order may be cited as the Directions to the CRTC (Direct-to-Home (DTH) Pay-Per-View Television Programming Undertakings) Order.

Interpretation

2. In this Order,

"CRTC" means the Canadian Radio-television and Telecommunications Commission; (CRTC)

"DTH distribution undertaking" means a Direct-to-Home (DTH) Satellite Distribution Undertaking; (entreprise de distribution par SRD)

"DTH pay-per-view television programming undertaking" means a pay-per-view television programming undertaking licensed to provide pay-per-view services for distribution to subscribers through a licensed DTH distribution undertaking; (entreprise de programmation de télévision à la carte par SRD)

"other pay-per-view television programming undertakings" means pay-per-view television programming undertakings that provide pay-per-view television programming via satellite to cable affiliates; (autres entreprises de programmation de télévision à la carte)

"pay-per-view television programming undertaking" means a pay television programming undertaking that provides a pay-per-view service. (entreprise de programmation de télévision à la carte)

Directions

3. The CRTC is directed to promote, through licensing, a dynamically competitive market for DTH pay-per-view television programming undertakings.

4. The CRTC is directed to establish a class of licences in respect of the carrying on of DTH pay-per-view television programming undertakings.

5. The CRTC is directed, in the exercise of its powers in respect of the carrying on of a DTH pay-per-view television programming undertaking,

(a) to prohibit, by appropriate means, the undertaking from acquiring exclusive or other
preferential rights to pay-per-view distribution of feature films and other programming within
Canada;

(b) to ensure that the undertaking is subject to equitable obligations and makes maximum
contributions to Canadian programming, including a significant financial contribution derived
from a percentage of gross annual revenues to the production of Canadian programming, and
that the financial contribution is administered independently of the undertaking;

(c) taking into consideration the total number of channels over which the undertaking's service is
offered, to apply rules that are comparable or equivalent to those rules in effect in respect of
other pay-per-view television programming undertakings and that pertain to the annual
exhibition ratios of Canadian to foreign films and events, the annual minimum numbers of
Canadian films and events to be exhibited and the remittances to be paid by the undertaking to
rights holders for the Canadian films and events it exhibits;

(d) to require the undertaking to be subject to the same generally applicable Canadian policy as
other broadcasting undertakings in respect of the use of Canadian and foreign satellite facilities;

(e) not to refuse to issue a licence to an applicant for the sole reason that the applicant
proposes to use foreign satellites for the distribution of non-Canadian programming to
subscribers through a DTH distribution undertaking, provided that such use is consistent with
generally applicable Canadian satellite policy; and

(f) not to refuse to issue a licence to an applicant for the sole reason that the applicant holds a
licence to carry on a DTH distribution undertaking.

6. The CRTC is directed

(a) not to authorize any person or class of persons to carry on a DTH pay-per-view television
programming undertaking other than by means of a licence issued by the CRTC for that
purpose; and

(b) to call, immediately on the coming into force of this Order, for licence applications to carry on
English-language DTH pay-per-view television programming undertakings and for licence
applications to carry on French-language DTH pay-per-view television programming
undertakings and, thereafter, to complete the licensing processes in respect of those
applications concurrently with the licensing process for DTH distribution undertakings referred to
in section 7 of the Directions to the CRTC (Direct-to-Home (DTH) Satellite Distribution
Undertakings) Order.