ARCHIVED -  Decision CRTC 97-277

Decision

Ottawa, 25 June 1997

Decision CRTC 97-277

Affinity Radio Group Inc.

Hamilton, Ontario - 199700711

Acquisition of assets

1. Following a Public Hearing in Toronto beginning on 26 May 1997, the Commission approves the application for authority to acquire the assets of the radio programming undertaking CHAM Hamilton, from Golden West Broadcasting Inc. (Golden West), and for a broadcasting licence to continue the operation of this undertaking.

2. The Commission will issue a licence to Affinity Radio Group Inc. (Affinity) expiring 31 August 1999, the current expiry date, upon surrender of the current licence. The licence will be subject to the same conditions as those in effect under the current licence, as well as to any other condition specified in this decision and in the licence to be issued.

3. The price of the transaction is $1,700,000. Based on the evidence filed with the application, the Commission has no concerns with respect to the availability or the adequacy of the required financing and is satisfied with the benefits flowing from this transaction.

4. Mr. James O'Brien holds the only issued common share in Affinity. Upon approval of this application, Mr. O'Brien will transfer his share in Affinity to Holdco, a company to be incorporated. Mr. O'Brien will be Holdco's sole shareholder and will retain effective control of the company at all times.

5. This authority will only be effective and the licence will only be issued at such time as the Commission receives documentation establishing that an eligible Canadian corporation has been incorporated in accordance with the application in all material respects and that it may be issued a licence.

6. The Commission notes that, although the applicant did not propose any tangible benefits, CHAM has been unprofitable over the three years preceding filing of this application. Accordingly, the Commission is satisfied that the application meets the criteria set out in Public Notice CRTC 1993-68 entitled Application of the Benefits Test at the Time of Transfers of Ownership or Control of Broadcasting Undertakings. The Commission notes the important benefit associated with this transaction, that being the maintenance of CHAM as a viable, local radio service to Hamilton. Accordingly, the Commission is of the view that approval of this application is in the public interest.

7. In Decision CRTC 95-615 dated 28 August 1995, the Commission approved Golden West' s request to defer, until the station achieved a positive operating income, the remaining $46,000 of original benefit obligations that were accepted as part of Golden West's acquisition of CHAM (Decision CRTC 92-600 dated 20 August 1992). The Commission notes Affinity's commitment to fulfil this benefit obligation, once CHAM has achieved a positive operating income.

8. The licensee is required, by condition of licence, to make payments to third parties involved in Canadian talent development at the level identified for it in the Canadian Association of Broadcasters' (CAB) Distribution Guidelines For Canadian Talent Development, as set out in Public Notice CRTC 1995-196 or as amended from time to time and approved by the Commission, and to report the names of the third parties associated with Canadian talent development, together with the amounts paid to each, on its annual return. The payments required under this condition of licence are over and above any outstanding commitments to Canadian talent development offered as benefits in an application to acquire ownership or control of the undertaking.

9. In Public Notice CRTC 1992-59, the Commission announced implementation of its employment equity policy. It advised licensees that, at the time of licence renewal or upon considering applications for authority to transfer ownership or control, it would review with applicants their practices and plans to ensure equitable employment. In keeping with the Commission's policy, it encourages the licensee to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources.

10. It is a condition of licence that the licensee adhere to the guidelines on gender portrayal set out in the CAB's Sex-Role Portrayal Code for Television and Radio Programming, as amended from time to time and accepted by the Commission. The application of the foregoing condition of licence will be suspended as long as the licensee remains a member in good standing of the Canadian Broadcast Standards Council.

11. It is also a condition of licence that the licensee adhere to the provisions of the CAB's Broadcast Code for Advertising to Children, as amended from time to time and accepted by the Commission.

12. The Commission has noted the opposing intervention filed with regard to this application, as well as the comments expressed in another intervention and is satisfied with the responses thereto.

This decision is to be appended to the licence.

Laura M. Talbot-Allan
Secretary General

This document is available in alternative format upon request.

DEC97-277_0