ARCHIVED -  Decision CRTC 99-305

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Ottawa, 23 August 1999
Decision CRTC 99-305
Blackburn Radio Inc.
St. Thomas, Ontario - 199904579London and St. Thomas, Ontario - 199904438 - 199904446 - 199904454
28 June 1999 Public Hearing
National Capital Region
Acquisition of assets
1.  The Commission approves the application by Blackburn Radio Inc. (Blackburn) for authority to acquire the assets of CFHK-FM St. Thomas from CFHK Radio Ltd., and for a broadcasting licence to continue the operation of this undertaking.
2.  The Commission will issue a licence to Blackburn expiring 31 August 2003, the current expiry date, upon surrender of the current licence.
3.  Further, the Commission approves the applications by Shaw Radio Ltd. (Shaw) for authority to acquire the assets of CFPL and CFPL-FM London and CFHK-FM St. Thomas from Blackburn, and for broadcasting licences to continue the operations of these undertakings.
4.  The Commission will issue licences to Shaw, expiring 31 August 2003, the current expiry date, upon surrender of the current licences.
5.  The projected purchase price relating to Shaw's transaction is approximately $40 million, subject to adjustments at closing. Based on the evidence filed with the applications, the Commission has no concerns with respect to the availability or the adequacy of the required financing.
6.  The Commission notes that Shaw's applications to acquire the assets of CFHK-FM, CFPL and CFPL-FM fall within the scope of the policy on the common ownership of radio stations established in Public Notice CRTC 1998-41, Commercial Radio Policy 1998. According to this policy, in markets with less than eight commercial stations operating in a given language, a single licensee may be permitted to own or control as many as three stations operating in that language with a maximum of two stations in any one frequency band.
7.  In evaluating applications that would result in common ownership, the Commission requires applicants to address the issue of diversity of voices. Shaw stated that it would ensure diversity by maintaining separate news formats on each station, each with its own style and content. It also noted the presence of numerous local and regional media outlets that will maintain various news sources and voices in the London and St. Thomas area. The Commission is satisfied that, in this case, approval of these applications will not negatively affect the diversity of voices offered to the communities.
8.  Consistent with the requirements of the benefits test outlined in Public Notice CRTC 1998-41, the benefits offered represent the required minimum direct financial contribution to Canadian talent development of 6% of the transaction (approximately $2.4 million). This includes:
·  3% (a minimum of $1,204,000 over 5 years) to be allocated to the Canadian Music Marketing and Promotion Fund, which is to be created;
·  2% (a minimum of $805,000 over 5 years) as a contribution to FACTOR; and
·  1% (a minumum of $392,000 over 5 years) to local Canadian talent initiatives.
9.  The 3% contribution which is to be allocated to the Canadian Music Marketing and Promotion Fund must be directed to the Canadian Association of Broadcasters who will hold all contributions in trust pending the creation of this fund. These commitments are over and above the existing commitments and conditions of licence for each station.
10.  Notwithstanding its projection of a purchase price of approximately $40 million, Shaw made a commitment to adjust its 6% benefits expenditures to reflect the final purchase price. The Commission expects Shaw to advise it regarding the final purchase price. Should the purchase price differ from the projected $40 million, the Commission expects the licensee to abide by its commitment to adjust its benefits expenditures accordingly. The Commission also expects Shaw to abide by its commitment that the expenditures will not be less than the amounts stipulated in the applications.
Conditions of licence
11.  The licences will be subject to the conditions specified in this decision and in the licences to be issued. By conditions of licence, the licensee must:
·  not operate the stations within the Specialty format as defined in Public Notice CRTC 1995-60 or as amended from time to time by the Commission;
·  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.
·  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 as amended from time to time and approved by the Commission, and 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. As outlined in Decision CRTC 97-152, CFHK-FM's contribution to Canadian talent development will be at the level identified for the London market.
·  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 approved 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;
·  adhere to the provisions of the CAB's Broadcast Code for Advertising to Children, as amended from time to time and approved by the Commission.
Other matters
12.  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.
13.  The Commission acknowledges the 21 interventions submitted in support of Shaw's applications.
This decision is to be appended to each licences. It is available in alternative format upon request, and may also be viewed at the following Internet site:
Secretary General
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