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ARCHIVED - Broadcasting Public Notice CRTC 2002-62

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Broadcasting Public Notice CRTC 2002-62

Ottawa, 18 October 2002

Proposal by the Canadian Cable Television Association (CCTA) to exempt small cable undertakings - Call for comment

The Commission calls for comment on a proposal by the Canadian Cable Television Association, first, to amend the Exemption Order for Small Cable Undertakings by making provision within it for the exemption of persons operating former Part III cable systems, and second, to issue a new Order exempting from regulation the operators of all Class 2 cable licensees.

Background

1.

Section 9(4) of the Broadcasting Act1 (the Act), directs that the Commission shall exempt from licensing requirements the operators of those classes of broadcasting undertakings, the licensing of which, in the Commission's view, will not contribute in a material manner to the objectives of the Act.

2.

In Proposed exemption order for small cable systems, Public Notice CRTC 2000-162, 7 December 2000, the Commission noted that smaller cable broadcasting distribution undertakings (BDUs) generally have fewer employees and more limited resources than larger BDUs, and are therefore the more greatly affected by the administrative burden of dealing with the Commission. It therefore invited comment on a proposed exemption order that would exempt from licensing requirements small cable undertakings of a class defined, in part, as those that serve "small and rural communities with a population of less than 10,000 and are operated by persons that, in total, serve less than 2,000 subscribers".

3.

Subsequently, in Changes to the Commission's approach to cable undertakings, Public Notice CRTC 2001-59, 29 May 2001 (Public Notice 2001-59), the Commission amended its proposed definition of small cable undertaking to include those where, " in total, the number of subscribers served by the individual undertaking is less than 2,000, the undertaking has its own head end, and does not serve all or part of the same licensed area as a cable undertaking that is a Class 1 or Class 2 licensee, as defined in the Broadcasting Distribution Regulations". The Commission also announced its determination that the licensing of such small cable undertakings was no longer necessary to meet the objectives of the Act.

4.

Consistent with the determination reached in Public Notice 2001-59, the Commission issued Exemption order respecting cable systems having fewer than 2,000 subscribers, Public Notice CRTC 2001-121, 7 December 2001. The Commission appended to this notice its Exemption Order for Small Cable Undertakings (the Small Cable Exemption Order). By this Order, and subject to certain conditions of exemption, the Commission exempted small cable undertakings from licensing requirements made under the Act. These conditions of exemption eliminate the administrative burden of licensing, while ensuring that these undertakings continue to fulfil the same obligations to which they had been subject as Class 3 undertakings under the Broadcasting Distribution Regulations (the Regulations). The Commission's overall purpose was to allow these small cable undertakings serving rural areas to focus their energies on responding to increasing competition from both direct-to-home (DTH) and multipoint distribution system (MDS) undertakings, and on providing their customers with better and more diverse communications services.

The CCTA's application

5.

On 5 July 2002, the Canadian Cable Television Association (CCTA) submitted a proposal that the Commission amend the Small Cable Exemption Order to include Class 3 cable undertakings that had been licensed as Part III licensees under the former regulations, namely the Cable Television Regulations, 1986. Unlike other Class 3 systems, the former Part III licensees operate systems having more than 2,000 subscribers, although many of these systems are located in remote or isolated regions. Such an amendment would affect 45 Class 3 cable systems serving a total of 171,734 subscribers.

6.

The CCTA's proposal included a proposition that the Small Cable Exemption Order be further amended to include those Class 2 cable undertakings that are not affiliated with the four largest cable multi-system operators (MSOs), namely Rogers Communications Inc., Shaw Communications Inc. Vidéotron Ltée and Cogeco Cable Inc.

7.

In response to Commission questions with respect to the current obligations of Class 2 cable systems, the CCTA modified its proposal. Specifically, instead of an amendment that would have included just the non-affiliated Class 2 licensees in the Small Cable Exemption Order, the CCTA proposed that a new exemption order be issued to exempt all Class 2 licensees. The amended proposal for an order that would embrace all Class 2 licensees, as well as all former Part III licensees, would result in the exemption of an additional 96 cable systems serving a total of 376, 784 subscribers.

8.

The CCTA indicated that, if the Commission were to exempt all Class 2 licensees, it would accept, as conditions of such exemption, the inclusion of the following obligations that currently apply to Class 2 licensees:
  • requirements for the distribution of French-language services contained in sections 16(1) and 18 of the Regulations;
  • requirements for the distribution of priority services, as determined by section 17(1) of the Regulations;
  • obligations concerning contributions to Canadian programming pursuant to section 29(1) of the Regulations;
  • requirements for the carriage of the TVA and APTN programming services, pursuant, respectively, to Decision CRTC 98-488, 29 October 1998 and Decision CRTC 99-42, 22 February 1999; and
  • requirementsfor the carriage of the proceedings of the House of Commons and its committees pursuant to Call for comments - Proposed amendments to the Broadcasting Distribution Regulations; Distribution of the proceedings of the House of Commons and its various committees, Broadcasting Public Notice CRTC 2002-34, 5 July 2002.

9.

The CCTA proposed that the following existing obligations of Class 2 cable systems not be included as conditions of exemption:
  • the distribution and linkage requirements of section 20 of the Regulations;
  • the simultaneous substitution requirements of section 30 of the Regulations; and,
  • the obligations respecting the installation and provision of basic service contained in section 48 of the Regulations.

10.

The CCTA included with its request, its proposed text for an amended Small Cable Exemption Order and for a new exemption order for Class 2 cable licensees. These texts appear in Appendices E and F, respectively, of the CCTA's letter dated 16 August 2002. This letter has been placed on the public file.

Call for Comments

11.

The Commission seeks comment on the CCTA's proposal, and on the following questions:
a) Does licensing of the former Part III licensees continue to contribute materially to the objectives of the Act?
b) Does licensing of Class 2 licensees that are affiliated with the four largest Canadian MSOs continue to contribute materially to the objectives of the Act?
c) Does licensing of Class 2 licensees that are not affiliated with the four largest MSOs continue to contribute materially to the objectives of the Act?
d) What impact, if any, would there be on subscribers of Class 2 or Class 3 systems that are exempted from regulation?
e) If Class 2 or the remaining Class 3 licensees are exempted from regulation, what impact, if any, would there be on competition, first, between cable systems, and second, between cable systems, DTH undertakings and MDS undertakings?
f) Taking into consideration that the Small Cable Exemption Order is for systems with fewer than 2000 subscribers, and that certain Part III systems have more than 2000 subscribers, if the Commission were to amend this exemption order to include the former Part III licensees, how might these systems be defined as a class of undertaking so as to satisfy the requirements of section 9(4) of the Act?
g) If the Commission were to exempt only those Class 2 licensees that are not affiliated with the four largest MSOs, how might this group be defined as a class of undertaking so as to satisfy the requirements of section 9(4) of the Act?
h) The conditions of exemption contained in the current Small Cable Exemption Order generally match the obligations of Class 3 licensees as set out in the Regulations, and are generally similar to those under which the remaining Class 3 licensees operate. Class 2 licensees, however, are subject to additional obligations pursuant to the Regulations, as well as to various Commission decisions and orders. If the Commission were to decide to exempt any group of Class 2 licensees from regulation, what conditions should it apply?

12.

The Commission will hold a two-stage written comment process for this proceeding. In the first stage, the Commission will accept comments that it receives on or before 2 December 2002. The Commission invites interested parties to file replies to any of the comments submitted during the first stage by 2 January 2003.

13.

The Commission will not formally acknowledge comments. It will, however, fully consider all comments and they will form part of the public record of the proceeding, provided that the procedures for filing set out below have been followed.

Procedures for filing comments

14.

Interested parties can file their comments either on paper or electronically (i.e. by email). Submissions longer than five pages should include a summary.

15.

Parties wishing to file their comments on paper should send them to the Secretary General, CRTC, Ottawa, K1A 0N2.

16.

Parties wishing to file their comments electronically can do so by sending them to procedure@crtc.gc.ca.

17.

Please number each paragraph of your submission. In addition, please enter the line ***End of document*** following the last paragraph. This will help the Commission verify that the document has not been damaged during transmission.

18.

The Commission will make comments filed in electronic form available on its web site at http://www.crtc.gc.ca  but only in the official language and format in which they are submitted. Such comments may be accessed in the Decisions, Notices and Orders section of the CRTC web site by searching under "Broadcasting Public Notice CRTC 2002-62". Copies of all comments, whether filed on paper or in electronic form, will also be placed on the public examination file.

19.

The Commission encourages interested parties to monitor the public examination file (and/or the Commission's web site) for additional information that they may find useful when preparing their comments.

Examination of public comments and related documents at the following Commission offices during normal business hours

Central Building
Les Terrasses de la Chaudière
1 Promenade du Portage, Room G-5
Hull, Quebec K1A 0N2
Tel: (819) 997-2429 - TDD: 994-0423
Fax: (819) 994-0218

Metropolitan Place,
99 Wyse Road, Suite 1410,
Dartmouth, Nova Scotia, B3A 4S5.
Tel: (902) 426-7997 - TDD: 426-6997
Fax: (902) 426-2721

405 de Maisonneuve Blvd. East
2nd Floor, Suite B2300
Montréal, Quebec H2L 4J5
Tel: (514) 283-6607 - TDD: 283-8316
Fax: (514) 283-3689

55 St. Clair Avenue East
Suite 624
Toronto, Ontario M4T 1M2
Tel: (416) 952-9096
Fax: (416) 954-6343

Kensington Building
275 Portage Avenue
Suite 1810
Winnipeg, Manitoba R3B 2B3
Tel: (204) 983-6306 - TDD: 983-8274
Fax: (204) 983-6317

Cornwall Professional Building
2125 - 11th Avenue
Room 103
Regina, Saskatchewan S4P 3X3
Tel: (306) 780-3422
Fax: (306) 780-3319

10405 Jasper Avenue
Suite 520
Edmonton, Alberta T5J 3N4
Tel: (780) 495-3224
Fax: (780) 495-3214

530-580 Hornby Street
Vancouver, British Columbia V6C 3B6
Tel: (604) 666-2111 - TDD: 666-0778
Fax: (604) 666-8322

Secretary General
This document is available in alternate format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca
1 The section states: Exemptions.- The Commission shall, by order, on such terms and conditions as it deems appropriate, exempt persons who carry on broadcasting undertakings of any class specified in the order from any or all of the requirements of this Part or of a regulation made under this Part where the Commission is satisfied that compliance with those requirements will not contribute in a material manner to the implementation of the broadcasting policy set out in subsection 3(1).

Date Modified: 2002-10-18

Date modified: