Broadcasting Commission Letter addressed to Ms. Cynthia Rathwell (Shaw Communications Inc.)
Ottawa, 8 April 2016
Ms. Cynthia Rathwell
Vice-President, Regulatory Affairs
Shaw Communications Inc.
1400 – 40 Elgin Street
Ottawa, Ontario K1P 5K6
Subject: Shortfalls relating to Canadian programming contributions
Dear Ms. Rathwell:
As you are aware, the Commission recently conducted an audit of Star Choice Television Network Incorporated’s (Star Choice) annual returns for the broadcast years 2012-2013 and 2013-2014. During that audit, Commission staff identified an area of apparent non-compliance with the contribution requirements under section 52 of the Broadcasting Distribution Regulations (the Regulations) due to issues with your calculation of your broadcasting revenues. You were notified of this apparent non-compliance by letters dated 29 October 2015 and 1 December 2015 and responded by letters dated 13 November 2015 and 10 December 2015.
This letter is to inform you that following a Commission determination, the Commission finds Star Choice in non-compliance with the contribution requirements under section 52 of the Regulations.
The non-compliance stems from the fact that Star Choice did not include the following revenue streams; channel lease, fees for account reinstatement and service calls, MDU receiver rental fees and uncollected subscribers fees (otherwise known as bad debts) in the gross revenues derived from broadcasting activities used to calculate its contribution requirements under the Regulationsfor the 2012-2013 and 2013-2014 broadcast years. The related shortfalls are $744,541 for Canadian programming.
The Commission directs Star Choice to pay the shortfalls as follows:
- The total Canadian programming shortfall ($744,541) must be paid within 90 days of the date of this letter.
- A minimum of 80% ($595,633) of the total shortfall must be paid to the CMF; and
- the remaining 20% of the shortfall ($148,908) may be paid to an independent production fund.
Proof of payment must be filed with the Commission within 120 days of the date of this letter.
The Commission further notes that the contributions to Canadian programming for the 2014-2015 broadcast year ended 31 August 2015, must reflect the inclusion of the revenue streams identified above in the gross revenues derived from broadcasting activities used to calculate the contribution requirements. This determination does not address Star Choice’s compliance for the 2014-2015 broadcast year.
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