ARCHIVED -  Decision CRTC 99-37

Decision

Ottawa, 17 February 1999

Decision CRTC 99-37

Newcap Inc.

Edmonton, Alberta - 199805199

7 December 1998 Public Hearing in Montréal

Acquisition of the assets of CIRK-FM

1. The Commission approves the application for authority to acquire the assets of CIRK-FM Edmonton from Radio One Edmonton Corporation (Radio One), and for a broadcasting licence to continue the operation of this undertaking.

2. The Commission will issue a licence to Newcap Inc. (Newcap), expiring 31 August 2003, 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 those conditions specified in this decision and in the licence to be issued.

3. Newcap is wholly owned by Newfoundland Capital Corporation Limited. The latter is controlled by Harry R. Steele.

4. The purchase price relating to this transaction is $10 million. 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.

5. Newcap currently owns CKRA-FM Edmonton. The Commission notes that this application falls within the scope of the new common ownership policy established in Public Notice CRTC 1998-41 entitled Commercial Radio Policy 1998. According to this policy, in markets with less than eight commercial stations operating in a given language, a licensee may own or control as many as three stations operating in that language, with a maximum of two stations on the AM or FM band.

6. Consistent with the requirements of the benefits test outlined in Public Notice 1998-41, the benefits offered represent the required minimum direct financial contribution to Canadian talent development of 6% ($600,000) of the transaction. The licensee will contribute $120,000 each year over five years to be allocated as follows:

· 3% to the Canadian Music Marketing and Promotion Fund, which is to be created;

· 2% to FACTOR; and

· 1% to other Canadian talent development initiatives.

7. 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 CIRK-FM's existing commitments and conditions of licence.

8. Newcap has also made a commitment to assume responsibility for $159,942 in unfulfilled Canadian talent development initiatives promised as part of a previous ownership transaction (see Decision CRTC 95-593 approving the transfer of CIRK-FM to Craig Broadcast Systems Inc.).

9. In Public Notice 1998-41, the Commission stated that applicants seeking to acquire ownership or control of more than one AM and one FM station in a given market will be required to outline how their proposed programming will benefit the community and further the objectives of the Broadcasting Act. Newcap indicated that it will continue to provide three distinct news formats on its three Edmonton stations, each with its own style, content and voice. In addition, Newcap made a commitment to dedicate 12 vehicles and reporters to cover various community and charitable events in Edmonton and surrounding area.

Conditions of licence

10. As conditions of licence, the licensee must:

· not operate this station 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, 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 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 an undertaking;

· 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; and

· 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

11. 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.

Secretary General

This decision is to be appended to the licence.
This document is available in alternative format upon request, and may also be viewed at the following Internet site:

www.crtc.gc.ca