ARCHIVED -  Letter

Ottawa, 24 May 2012

By email

Kevin Goldstein
Vice President - Regulatory Affairs
Bell Media
299 Queen Street West
Toronto Ontario M5V 2Z3
kevingoldstein@bellmedia.ca

Jennifer Salmon
VP Contracts
Canadian Independent Distributors Group
447 Gondola Point Road
Quispamsis New Brunswick E2E 1E1
jsalmon@ccsa.cable.ca

Anne Mainville-Neeson,
Director of Broadcast Regulation
Telus
8th Floor, 215 Slater Street,
Ottawa, Ontario K1P 0A6
ann.mainville-neeson@telus.com

Re:  Application for Final Offer Arbitration pursuant to Sections 12 to 15 of the Broadcasting Distribution Regulations with respect to a dispute relating to the renewal of affiliation agreements between the Canadian Independent Distributors Group and Bell Media. Inc.

Dear Sir and Madame:

In accordance with paragraphs 22 and 23 of Broadcasting and Telecom Information Bulletin CRTC 2009-38 (Information Bulletin 2009-38), this letter is to advise parties that Bell Media Inc’s (Bell Media) application for final offer arbitration with respect to a dispute relating to the renewal of affiliation agreements between the Canadian Independent Distributors Group (CIDG) and Bell Media has been accepted by the Commission.

This letter sets out the dates upon which the final offer arbitration process is to be conducted and the procedure to be followed.

The Application

Bell Media submitted in its application dated 9 May 2012 (the Bell Media Application), that it would be appropriate to resolve the present dispute by way of final offer arbitration and that while the parties were able to come to agreement on certain matters, a number of key issues  remain unresolved.

Bell Media stated that it is prepared to proceed to final offer arbitration with CIDG as a group or, on a concurrent basis, with its individual members. Bell Media proposed an expedited timetable for the consideration of the dispute.

The Response

In its response dated 14 May 2012 (the CIDG Response), CIDG indicated that the parties have been able to agree on many necessary terms of the agreement, but that the parties had failed to reach agreement on some key terms.  CIDG submitted that it is imperative that the Commission, in the context of the arbitration process, not merely determine broad principles which would require further negotiation, and that it expects the submissions of the parties to be as specific and comprehensive as the rest of the terms on which the parties have reached agreement.

CIDG requested that separate but simultaneous final offer arbitrations be conducted between TELUS Communications Company (TELUS) and Bell Media, and between the rest of CIDG and Bell Media.

The Process

The Commission has determined that separate but concurrent final offer arbitration processes for TELUS and other CIDG members will be conducted. References below to “parties” are to be interpreted to mean the parties to each of the two arbitrations.

The Commission reminds the parties that it is the Commission’s expectation that parties negotiate on a commercial basis the terms of affiliation agreements without calling upon the resources of the Commission. The Commission also reminds the parties that it has already devoted considerable resources to this dispute, including the Code of Conduct set out in Broadcasting Regulatory Policy CRTC 2011-601-1, a Commissioner led mediation, an oral hearing that provided the parties the opportunity of obtaining further clarifications on the Code of Conduct through direct interaction with the Commission panel, and the Commission’s determinations set out in Broadcasting Decision CRTC 2012-208.

The Commission notes CIDG’s suggestion that the parties jointly file, prior to final offer arbitration, a draft affiliation agreement which sets out all the terms and conditions that they have agreed to.  In light of the time and effort that the parties have devoted to their negotiations, the Commission agrees that this is a useful approach.  The Commission therefore directs the parties to each arbitration to jointly file, by 8 June 2012, a draft affiliation agreement that sets out all the terms and conditions that have been agreed to.

In respect of terms where the parties have been able to agree on the wording of the provision but not the numeric values, such as in a rate clause where agreement has been reached on the wording but not the rate to be paid, the draft agreement is to set out the wording of the provision.

In the case of provisions where no agreement has been reached on the wording of the provision, the parties shall set out a heading for the provision and leave the section blank.  In this manner, the jointly submitted affiliation agreement will identify all the issues that each party wishes to be adjudicated by the Commission.

The parties are further directed to file with the Commission, by 8 June 2012, a comprehensive affiliation agreement in which all the sections left blank in the jointly-filed draft affiliation agreement have been completed.  If a party fails to complete a section or omits a section then the provision from the other party’s agreement will be incorporated into its agreement.  Each party’s agreement must be in an executable form and duly signed by an officer with the authority to legally bind the party.

The affiliation agreements filed in executable form shall constitute each party’s final offer.  These final offers must be accompanied by a document which concisely sets out the supporting rationale of the party’s position. These submissions must be no longer than 10 pages. 

By 11 June 2012, upon confirmation that all offers respond to the identified disputed matters, the Commission will forward to each of the parties a copy of the other party’s offer.    

Oral Hearing

In light of the breadth and complexity of the dispute, the Commission will conduct a brief oral hearing, in camera, in respect of each final offer arbitration process. The only purpose of this oral component will be for parties to respond to questions and requests for clarification from Commission Panel members. Parties will not be able to change their original offer. The oral hearings will be held as follows: i) Friday, 29 June 2012 at 9:00 a.m.  (Bell Media and CIDG) and ii) Friday, 29 June 2012 at 1:30 p.m. (Bell Media and TELUS).

The Commission will then review both agreements and choose one in its entirety.  The Commission will not select provisions from both agreements and create a third agreement.  The Commission shall then require the party who has not signed the agreement to execute it and this agreement shall constitute the affiliation agreement between the parties for the term of the agreement. As stated in Information Bulletin 2009-38, final offer arbitration before the Commission will result in a binding determination.

Confidentiality 

As noted in paragraphs 40 and 41 of Information Bulletin 2009-38, existing Commission confidentiality rules and practices will apply during final offer arbitration proceedings. Where a party files information with the Commission in confidence, the party must provide sufficient details as to the nature and extent of the specific direct harm that it considers would result from the disclosure of the information subject to the confidentiality claim.

The party is also to file an abridged version of the document for the public record accompanied by reasons for the confidentiality designation or reasons for objecting to the filing of an abridged version.

Information filed with the Commission will be placed on the public record unless the party filing the information designates the information as confidential at the time of filing. Where the Commission is of the opinion that any specific direct harm likely to result from public disclosure is not sufficient to outweigh the public interest in disclosing the information, it may place information designated as confidential on the public record.

This determination may be made on the Commission’s own initiative, or at the request of a party, after providing the party filing the information a further opportunity to justify its confidential designation.

Further, pursuant to the Canadian Radio-television and Telecommunications Rules of Practice and Procedure (the Rules of Procedure), as this proceeding relates to matters under the Broadcasting Regulatory framework, where the Commission determines that the information should be disclosed, and the party filing the information confirms its designation of the information as confidential, the information will not be disclosed and will not be considered by the Commission in its determinations.

Mandatory Mediation

The Commission will hold a mandatory mediation session for each arbitral proceeding after the written record is complete and prior to the oral component of the proceeding.  Parties should familiarize themselves with the Commission’s expectations with respect to their participation in the mediation as set out in paragraph 129 of Broadcasting Decision CRTC 2011-601. 

Order of the Proceeding

An agenda outlining/confirming the specific locations, dates, times and expected processes for the mandatory mediation sessions and the oral hearings will be sent out to the parties no later than 11 June 2012. 

Filing of Documents

Any documents filed with the Commission should be filed using Access Key and specifying the Commission file number indicated on this letter.  Parties can access to Access Key on the Commission’s web site http://www.crtc.gc.ca/eng/forms/form_index.htm

Responsibilities of the Parties

With respect to the oral hearing, the parties are required to bring with them all relevant documentation and knowledgeable personnel. An adverse inference may be drawn, if appropriate, from the failure of a party to bring all relevant documentation and knowledgeable personnel to the oral hearing. 

The parties are also required to provide by Access Key, and serve on each other, at least 10 days prior to the oral appearance, the name(s) of the person(s) who will be attending and their area of expertise. 

Parties may contact Mr. Gerry Lylyk at (819) 953-0434, or at gerald.lylyk@crtc.gc.ca, if they require additional information regarding the organization and conduct of the hearing. 

Parties are reminded that, as of 1 April 2011, this proceeding will be conducted pursuant to the CRTC Rules of Practice and Procedure which incorporates Information Bulletin 2009-38.  For more information on the Rules of Procedure, see the Commission’s website at www.crtc.gc.ca/eng/nrpp.htm.

Where a document is to be filed or served by a specific date, the document must be actually received, not merely sent, by that date. In addition to filing with the Commission, all copies of submissions are to be sent to gerald.lylyk@crtc.gc.ca. 

Sincerely, 

Original Signed By

John Traversy
Secretary General

C.C.:  Pauline Jessome, MTS
Natalie Macdonald, EastLink
Yves Mayrand, Cogeco

Date modified:

2012-05-24