ARCHIVED -  Public Notice CRTC 1997-98

Contributions to Canadian Programming by Broadcasting Distribution Undertakings

Following the Structural Public Hearing, in Public Notice CRTC 1993-74 dated 3 June 1993, the Commission determined that "its jurisdiction to require each element of the broadcasting system to contribute to Canadian programming is clear, and that the nature, extent and mechanism of that contribution is entirely within its discretion." Consequently, the Commission announced its plans for the creation of a fund for the production of Canadian programming.

On 9 September 1996, the Minister of Canadian Heritage announced the creation of the Canada Television and Cable Production Fund (CTCPF), which would incorporate the existing CPF and Telefilm’s Broadcast Fund. The new fund was supplemented by new government funding representing $250 million over a three-year period commencing in fiscal year 1996-97.

In Public Notice CRTC 1996-159 dated 20 December 1996, the Commission endorsed the transfer of supervision of the CPF to the Department of Canadian Heritage.

THE CURRENT PROCEEDING

As part of its determination on the new Broadcasting Distribution Regulations, the Commission, in Public Notice CRTC 1997-25 dated 11 March 1997, announced that broadcasting distribution undertakings (BDUs) would be required to participate in the production of new quality Canadian programming through a financial contribution to be directed to an independent production fund. The Commission was silent on the operating principles and guidelines of such contributions.

The Commission received 133 submissions in response to its call for comments. These comments were submitted by various groups within the broadcasting and production industries. The vast majority of the submissions expressed concern about the Commission’s proposal to direct all BDU contributions to the CTCPF. Alternative proposals ranged from various split levels between the CTCPF and independently-administered funds, to full flexibility for BDUs to choose how they would direct their contributions. The opinions of various groups are set out below.

Small independent producers clearly indicated that they would support a policy that would allow BDUs to direct all programming contributions to the independently-administered production fund of their choice.

Producers and/or distributors generally supported the option of allowing BDUs the choice of contributing to any independently-administered fund. They proposed, however, that the best way to achieve choice and maintain a strong CTCPF would be a scheme whereby BDUs could split their contribution for the production of Canadian programming between the CTCPF and other independently-administered funds. There was no consensus within this group with respect to an appropriate split. Some parties proposed that 90% of BDU contributions be directed to the CTCPF, with 10% going to other independently-administered funds, while others proposed an 80/20 split.

All but one of the broadcasters suggested amendments to the Commission’s proposal that would allow BDUs greater flexibility in choosing the fund(s) that would administer their contributions. However, a majority proposed that the CTCPF should administer the larger portion of the BDU contributions. The Canadian Association of Broadcasters supported the Commission’s proposal.

Most submissions received from production funds expressed the opinion that BDUs should have the flexibility to direct their contributions to the production fund of their choice. For its part, the CTCPF proposed an 80/20 split of contributions, with the larger portion to be directed to the CTCPF.

Distributors other than traditional cable distributors generally expressed the view that BDUs should be able to direct their contributions to the independently-administered production fund of their choice. The Canadian Cable Television Association supported the CTCPF’s proposal.

After considering the submissions to the present proceeding, a majority of the Commission has determined that the best way to maximize the impact of the BDU contributions on the Canadian film and television industries is to allow BDUs to split their contributions between the CTCPF and one or more other independently-administered funds.

The Commission considers it vital that the CTCPF be provided with realistic amounts of capital to enable it to fund a significant amount of quality Canadian production. Accordingly, the Commission has determined that a BDU must direct a minimum of 80% of its contribution to the CTCPF.

At the same time, the Commission considers that funding should be available to programs that are not eligible for support through the CTCPF. In order to address the specific request of some BDUs or potential BDUs to contribute to funds associated with their activities and to expand the categories of programs that receive assistance, the Commission has concluded that a BDU may direct up to 20% of its contribution to one or more new or existing independently-administered funds, other than the CTCPF, provided that the fund meets the following criteria:

productions receiving funding meet the eight points out of ten for Canadian content certification as set out in Public Notice CRTC 1996-51 dated 3 April 1996.

In arriving at its majority decision, the Commission has considered the various submissions filed by the parties to this process. It has concluded that allowing BDUs to direct a portion of their contributions to one or more other independently-administered production funds will ensure that there is a mechanism that can respond to some of the legitimate funding demands which do not currently fit within the framework of the CTCPF. In this manner, BDUs will be able to provide financing to funds designed to assist productions such as educational or informational programs, documentaries and programs produced by aboriginal producers that do not meet the CTCPF criteria, and many other types of programs that do not currently have access to the CTCPF for financing.

A majority of submissions expressed the opinion that the description of under-represented categories, as set out in Public Notice CRTC 1994-10, should be enlarged to acknowledge the specific needs of the niche specialty services. In that notice, the Commission determined that: "Programs that will be eligible for support from the production fund are restricted to drama, music and dance and variety ...; to programs aimed at children aged twelve and under; and, provided they conform to Telefilm Canada’s definition, to documentary programs." Small producers expressed a concern that this statement has a restrictive effect on their ability to access CTCPF funding for their productions.

As stated earlier, supervision of the CPF has been transferred to the Department of Canadian Heritage. As a result, the Commission no longer has a mandate to specify or define the categories of programming which qualify for funding under CTCPF rules.

The Commission notes that allowing BDUs to direct up to 20% of their contributions to funds that would base their funding decisions on criteria other than those prescribed under the CTCPF’s mandate will partially address this concern.

A majority of submissions were received from small regional production companies. Most of these parties argued that centrally-administered funds would not permit regional producers to access funding to tell regional stories and address regional issues and concerns. Regional contributions might, it was argued, simply subsidize central Canadian producers. These regional production companies therefore recommended that funds generated by regional BDUs be allocated to regionally-based producers.

The Commission notes that its decision to allow BDUs to direct up to 20% of their contributions to funds other than the CTCPF will permit BDUs to contribute to a regional fund, provided the fund meets the criteria set out above.

PROPOSAL SUBMITTED BY L’ASSOCIATION DES RADIOS COMMUNAUTAIRES DU CANADA (ARC DU CANADA)

As part of the present proceeding, ARC du Canada filed a request to access a portion of BDU contributions in order to finance local expression for minority Francophone and Acadian communities for the production of local radio educational programming.

After giving due consideration to ARC du Canada’s proposal and its supporting submissions, the Commission has concluded that BDU contributions to the production of quality Canadian programming should not be directed to the production of radio programming.

The Commission nevertheless recognizes the importance of projects such as the one described by ARC du Canada and encourages distributors who have not yet made a commitment towards some form of community expression to consider supporting this type of project.

The Commission notes that it plans to consider innovative ways of providing additional financial resources for community radio, as part of a future process.