ARCHIVED -  Decision CRTC 98-469

Decision

Ottawa, 29 September 1998

Decision CRTC 98-469

Maritime Broadcasting System Limited

Saint John, New Brunswick - 199803135 - 199803143

Acquisition of assets

1.  Following a Public Hearing in the National Capital Region held on 11 August 1998, the Commission approves the applications by Maritime Broadcasting System Limited (Maritime) for authority to acquire the assets of the radio programming undertakings CFBC and CJYC-FM Saint John, and for broadcasting licences to continue the operation of these undertakings.

2.  The Commission will issue licences to Maritime, expiring 31 August 2004, upon surrender of the current licences issued to Fundy Cable Ltd./Ltée (Fundy). The licences will be subject to the same conditions as those in effect under the current licences, as well as to any other condition specified in this decision and in the licences to be issued.

3.  Approval of these applications will result in Maritime owning two FM stations and one AM station in the Saint John market. This situation is consistent with the Commission's new common ownership policy, announced in Public Notice CRTC 1998-41, dated 30 April 1998 entitled Commercial Radio Policy. The policy now permits the common ownership of up to three stations in a four-station market, so long as no more than two of the commonly-owned stations are on the same band.

4.  An intervention in opposition to the applications was submitted by Ms. Heather Harrison, a former employee of CFBC/CJYC-FM. Ms. Harrison expressed concern related to job losses at the two stations. In general, the Commission considers that management decisions of a licensee fall outside of its purview, so long as a station is being operated in accordance with the applicable regulations and policies. It notes, however, the reply to the intervention that restructuring of the CFBC/CJYC-FM workforce had been necessary for financial reasons.

5.  An intervention was also submitted by New Brunswick Broadcasting Co. Limited (NBBCL), licensee of CHSJ-FM, the fourth station in the Saint John market. NBBCL expressed the concern that Maritime could change the format of any of its stations, thereby infringing upon CHSJ-FM's current country music format, resulting in smaller audiences and consequent financial loss. The intervention submitted by Ms. Harrison also expressed concern related to potential harm to CHSJ-FM. The Commission notes that it no longer regulates musical formats closely, and that all stations in this market are free to change format in response to competitive forces in the market.

6.  The Commission notes that, in its application, Maritime addressed the issues of programming variety and the diversity of news voices in Saint John. It notes in particular Maritime's commitment to ensure such diversity by maintaining separate programming policies as well as separate program directors and news directors. The Commission is satisfied that the freedom to alter musical formats for all stations involved, as well as the adherence by Maritime to its diversity-related commitments will ensure that no undue financial harm to any existing undertaking will result from approval of these applications. The Commission also notes Maritime's commitment to operate the station under the same terms and conditions as are currently applicable.

7.  The assets of the two stations noted above were part of an earlier series of transactions among Fundy, Maritime and Newcap Inc. (Newcap). In Decision CRTC 97-639 dated 18 November 1997, the Commission approved Maritime's applications to acquire the assets of CFBC and CJYC-FM from Fundy, on behalf of Newcap, as well as Newcap's applications to acquire the assets of these undertakings, pursuant to an assignment agreement entered into with Maritime, and for broadcasting licences to continue the operation of the two stations. Subsequent to that decision, Newcap indicated its intention not to finalize the transaction with Maritime.

8.  In Decision CRTC 97-639, the Commission also approved a request by Maritime, on behalf of Fundy, to amend the broadcasting licence for CJYC-FM, by decreasing the effective radiated power from 50,000 watts to 8,200 watts, although the Commission notes that the power decrease was never implemented. The Commission reminds Maritime that any modification to the technical parameters of CJYC-FM requires a further application to the Commission.

9.  The Commission notes that CFBC and CJYC-FM combined have been unprofitable over the three years preceeding filing of these applications. In accordance with its policy, first enunciated in Public Notice CRTC 1993-68 dated 26 May 1993 and most recently reiterated in Public Notice CRTC 1998-41 dated 30 April 1998, the Commission will forego benefits requirements for these stations. Nevertheless, the Commission notes the important benefit associated with this transaction, that being the maintenance of CFBC and CJYC-FM as viable local radio services to Saint John.

10.  The Commission notes that, as part of its application, Maritime proposed to adopt all commitments made by Newcap relating to CFBC and CJYC-FM as set out in Decision CRTC 97-639. The licensee is therefore 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, concurrently with 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.

11.  It is a condition of CJYC-FM's licence that this station not be operated within the Specialty format as defined in Public Notice CRTC 1995-60, or as amended from time to time by the Commission

12.  It is also a condition of CJYC-FM's licence that the licensee broadcast, in any broadcast week, less than 50% hit material as defined in Public Notice CRTC 1997-42 dated 23 April 1997, as amended from time to time.

13.  It is a condition of each 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.

14.  It is a condition of each 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.

15.  The Commission notes that this licensee is subject to the Employment Equity Act that came into effect on 24 October 1996 (1996 EEA), and therefore files reports concerning employment equity with Human Resources Development Canada. As a result of a consequential amendment to the Broadcasting Act, the Commission no longer has the authority to apply its employment equity policy to any undertaking that is subject to the 1996 EEA.

16.  The Commission acknowledges and has considered all of the interventions submitted with respect to these applications.

This decision is to be appended to each licence.

Laura M. Talbot-Allan
Secretary General

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