Catching up on MediaPolicy.ca – Postmedia layoffs – Rogers Shaw update – Home Depot gave your email to Facebook – US DOJ targets Google’s AdTech – US trade threats, again.

Andrew MacLeod, Postmedia CEO

January 29, 2023

Yet again another bloodletting in print journalism.

This week Postmedia announced an 11% staff cut across its entire news chain. Within the week the redundancy notices will begin and by the end of February we will know who is leaving through buy-outs or layoffs.

The decision came two weeks after a quarterly report highlighting a double digit percentage decrease in advertising and circulation revenues. Asset sales allowed Postmedia to pay down and lower its first-lien debt to $41 million.

***

Last week was an eventful period for the Rogers-Shaw merger, most significantly the Federal Court of Appeal’s rejection of the Competition Commissioner’s appeal.

MediaPolicy.ca’s take is posted here: it’s now time to move past the politics of the merger and put our energy into the federal government’s review of competition legislation.

***

Shopped at Home Depot Canada lately?

Big Orange and Meta have been unmasked by the Canadian Privacy Commissioner for their secret deal to aggregate customer data from e-mailed receipts.

Home Depot used the customer data on products, pricing and personal e-mail addresses with the help of a Facebook tool to verify the effectiveness of Home Depot digital advertisements. It then sold the data to Meta.

As any shopper knows, no customer consent was asked or given. Home Depot told the Privacy Commissioner your consent was implied by shopping there.

As of October, Home Depot stopped misappropriating the data. Still, it reserves the ‘right’ to do so.

The Privacy Commissioner has no sanctions available, but Bill C-27 is intended to change that.

***

Perhaps we have buried this above-the-fold story.

The US Department of Justice announced this week that it is at last filing a complaint under the Sherman Anti-Trust Act against Google for its abuse of market power in digital advertising, specifically its AdTech business.

This targets the core of Google’s enterprise and has very much caught the attention of market analysts.

The Canadian Bureau of Competition walked away from the AdTech file in 2016.

***

MediaPolicy.ca recently posted two chapters in the history of US-Canada trade disputes over cultural goods. Our conclusion was this: the US will always try to bully Canada with allegations of cultural protectionism. Sometimes the complaints have some legal merit, but usually they have none.

Hugh Stephens of the University of Calgary analyzes the latest American threats to “retaliate” against Bills C-11 and C-18.

***

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It’s time to move on from the Rogers-Shaw merger and get on with the review of competition law.

University of Ottawa law professor Jennifer Quaid before the House Committee on Innovation and Technology, January 25, 2023

January 28, 2023

The story of the Rogers-Shaw merger is all but over as we await Innovation Minister François-Philippe Champagne’s final approval.

The Minister’s latest messaging semaphore was that he is in no hurry to put the merger to bed by authorizing the transfer of radio-spectrum licences from Shaw to Rogers and Vidéotron.

But that’s just politics. The likelihood of the Minister vetoing the court-approved merger to seek a new ownership configuration is remote.

For those who didn’t follow last week’s rapid-fire developments, here are the highlights:

  • On January 19th the country’s leading wholesale-based telco TekSavvy filed a CRTC complaint designed to overturn the merger apple cart by targeting the wholesale Internet rates afforded by Rogers to Vidéotron in British Columbia and Alberta. TekSavvy says that arrangement is a sweetheart deal and violates CRTC rules prohibiting telcos like Rogers showing “undue preference” to some but not all wholesale based providers.
  • As expected by all but the faithful, on Tuesday afternoon the Competition Commissioner Matthew Boswell lost his federal court appeal of the Competition Tribunal’s ruling that the merger was not anti-competitive. Indeed the Tribunal had found as a legal fact that the long term commercial arrangements between Rogers and Vidéotron on wholesale rates and network sharing would enhance competition.

The Commissioner’s case was so weak that the Court told lawyers for Rogers, Shaw and Vidéotron that they didn’t have to address the court. Justice David Stratas told the Commissioner his case “wasn’t even close.”

  • On Tuesday evening the Commissioner announced in a press release that he was still right but would not appeal to the Supreme Court of Canada.

It was at this point that the terms of political engagement took shape for the fifth and final Act of the merger drama.

  • On Wednesday morning MPs met in the House of Commons Innovation & Technology (INDU) committee to question representatives from all of the telcos as well as several university academics opposed to the deal.

It was a slag fest of cross-insults between telcos and campaign-style outrage from MPs.

The most effective attack on the deal came from Conservative MP Ryan Williams who wanted to know “why Rogers got to pick its fourth competitor” in Vidéotron.

Liberal MP Nathaniel Erskine-Smith joined in, asking if anyone had a good answer to why Shaw would choose to take a billion dollars less from Vidéotron to sell Freedom Mobile than the $3.75 billion offered by Anthony Lacavera of Globalive.

Lacavera (and others) have called on Champagne to block Shaw’s sale of Freedom to Vidéotron and then conduct a government-supervised auction. The latter option would require an Act of Parliament.

If at any point the inconsolable opponents of the merger are prepared to stand down the populist politics long enough to consider lessons on reforming competition laws, Professor Jennifer Quaid of the University of Ottawa had some advice for INDU MPs.

First, she appeared to suggest that Rogers and Shaw may have gamed the Competition Bureau’s vetting protocol by holding back its best mitigation proposal (the deal with Vidéotron) with all of the detailed information required for the Bureau’s econometric analysis until after the Bureau decided to reject the merger.

If that’s what Rogers did with strategic intent, it’s not possible to put that allegation to the test without a great deal of insider knowledge, some of which is legally confidential.

But Quaid offered an important overall point: we have a public interest in making sure merger applicants don’t play tactical games with the Bureau.

The other point is the obvious gap between the policy assumptions underpinning current competition law and the public skepticism about its outcomes.

Although Quaid (as a critic of the deal) doesn’t say so, part of this gap must surely be attributed to the populist criticism of the merger. Most of that criticism is that the merger is self-evidently terrible, anti-competitive and supported only by vested interests “and the business press.”

Perhaps that deep skepticism is to be expected: the north star of Canada’s competition law resides in the statute’s purpose clause which elevates market-driven efficiency to the exclusion of any other considerations.

That ought to produce a pro-consumer outcome every time, but much of popular opinion doesn’t view consumer interests and corporate consolidation as compatible, ever.

The skepticism may also be explained by a disconnect between a statute administered as it was envisioned and on the other hand popular suspicions that competition law is a pro-business regime designed for and by the Bay Street establishment and then policed by the same elite.

Quaid alluded to this state of affairs in a couple of different ways:

My second of two points is on the Tribunal processI think it’s a heavy process. It’s like a court. Yet it’s packaged as an expert entity. I urge you to look at the kinds of expertise that is generally used in the Tribunal and whether or not you think that captures the full public interest that might bear on competition matters. For the most part, the expertise is business and economics. The question is, are there other perspectives relevant to the competition questions that come up that we should perhaps ensure are better represented in the Tribunal?

I’m one of those people who believes there is a place for regulation and direction. ... If you rely simply on the wealth maximizing incentives of private actors—and they are perfectly entitled to organize their affairs in that way—you may not get the outcomes you want from a public policy perspective

And finally and wisely (forgiving the clunky Google translation):

I think it is the duty of this government and…parliamentarians to listen to citizens, without polish, without labels, without packaging, all beautiful, etc. However, we cannot completely disregard the popular reaction that is happening either because I think that the citizens are not always well equipped to know how to organize their opposition. In this regard, I am lenient because I think there’s a real desire and a real frustration coming out. Rightly or wrongly, I won’t start saying who is right or wrong. However, I think it is clear that there is a gap between the popular understanding of the impacts of this transaction and economic and legal understandings of it. I think it is necessary that there be a communication between the two if we don’t want to have a revolt in relation to the process.

Connecting the dots between those comments, Quaid suggests that if the public thinks there is something badly wrong about competition law outcomes, we had better revisit its overall mission.

Alternatively, it may be that there is nothing fundamentally wrong with our competition law and it only needs stronger enforcement tools. That has been the view of many, including the Competition Commissioner. Some of these changes were made in last summer’s amendments to the Act.

Either way, the federal government’s public consultation window on competition reform remains open until February 27th. The background paper is available here.

***

Also from MediaPolicy.ca: Will Big Tech be cut down to size? What’s next for competition law – February 3, 2022

***

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Catching Up on MediaPolicy.ca – Cultural Trade Wars, the sequel – the Rogers-Shaw-Québecor Pinãta – the online safety cauldron is bubbling – Terry Glavin in your face.

January 23, 2023

Last week MediaPolicy.ca published the second of two posts mining the history files for lessons learned about trade stand-offs with the US on cultural legislation.

The 1995 Country Music TV dispute seemed like a phony war, but the 1999 split-run magazine confrontation was the real thing. It was a genuine sound and fury and may still be influencing Heritage Canada’s approach to C-11 and C-18.

***

Speaking of sound and fury, MPs on the parliamentary Industry committee (INDU) want to have another go at the Rogers-Shaw merger.

The committee’s first report in March 2022 condemned the merger and since then the agreement has been reconfigured by the sale of Shaw’s Freedom Wireless to Québecor and the Competition Tribunal’s approval of the three-cornered deal.

Appearances at this Wednesday’s day long meeting are scheduled for Rogers, Shaw and Québecor but also industry rivals Globalive Communications (which wants to buy Freedom Wireless) and the telcos’ tormentor-in-chief Tek Savvy. The Competition Bureau is also summoned.

The remainder of the witness list is loaded up with opponents of the deal so proceedings may resemble a robust game of piñata.

Tomorrow the Competition Bureau appears before the Federal Court of Appeal to challenge the Tribunal’s approval of the merger.

***

The controversy of curating online speech continues to bubble in nations around the world.

The rights, responsibilities and liabilities of social media platforms are being regulated by legislators in some countries. But in the US it seems the Supreme Court is destined to become the regulator by default. There’s a good story in the New York Times on that.


***

My read of the week: Terry Glavin’s thoughts on the CBC and trust in journalism. No endorsement offered (or sought), but Glavin’s fearless iconoclasm is as refreshing as ice water.

***

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The billion-dollar cultural trade war that was: the 1999 Canada-US split-run magazine dispute

Heritage Minister Sheila Copps, with assistance from PM Jean Chrétien, wrapping herself in the Canadian flag.

[20 minute read]

January 21, 2023

At the turn of the New Year 2023, reports appeared in both the English and French language press speculating on US trade retaliation against Bills C-11 and C-18. Neither was triggered by a news event of any substance.

We are the biggest trade partner of the United States, marked by a trillion dollars of cross-border commerce annually. We have the misfortune of being so good at it that we have rung up trade surpluses with the Americans every year going back to the 1980s.

When your older and bigger sibling owes you money, expect you’re going to pay for the privilege. It’s easy to lose count of the unwarranted US trade retaliations against Canada over the years in agricultural products, softwood lumber, auto parts and cultural products.

The cultural disputes are special because Canada regards culture as special. That’s why we have negotiated the famous “cultural exemption” in our bilateral trade deals with the US and other nations. The US of course, with its enormous volume in cultural exports reducing its overall trade deficit, regards culture as just another product.

Previously MediaPolicy.ca recounted the story of the US-Canada trade dispute over the CRTC licensing of Country Music Television (CMT) and a dozen other US cable stations in 1995, “the half-billion dollar trade war that wasn’t.”

But CMT was only a dry run for the next dispute. The sequel was an iconic cultural trade dispute with far more money at stake: the “split-run magazine” fight that began in 1993 and culminated in an ugly confrontation in 1999. It ended in Canada ceding significant market access to split-run US magazines.

Although even the worst quarrels between the US and Canada must be put in the perspective of a healthy economic and political relationship, this one featured the personal targeting of Heritage Minister Shiela Copps, the Americans’ wild success at turning Canadians against each other, and cynical US threats of sweeping (and illegal) trade actions against Canada.

***

Canadian cultural policy aims to push back against the continental market forces of American media to create enough space for Canadian content to reach Canadian audiences. In the dominant paradigm of trade liberalization, that makes us protectionist.

Our policy is based on the peculiar nature of cultural “goods” as holding almost of all their value as intellectual property. Unlike conventional goods emerging unit by unit from factory assembly lines, the cost of making cultural goods is heavily loaded at the front end of making one ‘master’ copy. Once those costs are recovered, the marginal costs of selling more to new customers and export markets are very low.

In addition, the high risk of making successful cultural products —-caused by consumer demand that is infamously difficult to predict—— favours gatekeeping media companies with significant market power.

Ergo the relentless drive of American media companies to recover their costs in their domestic market and then drive pure-profit expansion into foreign markets. Canada is their largest.

In resistance to the US juggernaut, many nations including Canada have developed a “policy toolkit” consisting of government subsides, public broadcasting, Canadian ownership, tariffs, revenue tithing, Canadian content regulations and tax policy.

All of these tools are subject to legal challenges by the US Trade Representative under the multi-lateral GATT and GATS trade deals supervised by the World Trade Organization, or the series of bilateral trade deals between the US and Canada in 1987, 1994 and culminating in the USCMA in 2017.

The nature of those trade agreements is that direct subsidies of domestic producers and public ownership are presumptively trade compliant; the remaining toolkit measures less so.

***

In the 1990s the Canadian magazine market was worth over a billion dollars annually in revenue, the majority from advertising.

While foreign magazines dominated 90% of the $800 million news stand market, Canadian magazines were extremely successful in building a subscription market that was boosted by a postal subsidy existing since 1849.

The dominant Canadian magazines were published by Rogers’ MacLean Hunter —-Maclean’s and Chatelaine—- and also the Montréal-based Télémedia (Canadian Living, Harrowsmith, and licensed Canadian editions of Elle and TV Guide).

Foreign magazines were widely sold provided they were imported with their original foreign advertisements and did not undercut Canadian magazines by re-selling the same editorial content to Canadian advertisers.

This prohibition against foreign “split-run” magazines (those republishing American editorial content to a Canadian audience with Canadian advertising) was enforced beginning in 1965 by an import ban, Tariff 9958.

There were only two exceptions to the ban on split-runs: Time magazine had been grandfathered in the 1965 import ban and Reader’s Digest had contrived a Canadian owned publishing company for its Canadian distribution.

Sleeping dogs lay quiet until the US-owned Time Warner decided in 1993 to wake them up by converting its Sports Illustrated magazine into a “split-run” selling Canadian advertising. The opportunity arose because of new technology: print-ready digital pages with Canadian advertisements could evade the border ban on hard copy magazines and be sent electronically to a Toronto-based printing house. Without the physical barrier of the import ban, Time Warner quietly got pre-approval from Investment Canada.

When it became public, the Canadian magazine industry was horrified by the approval. Sports Illustrated already had big sales in Canada and so was poised to bite off a big chunk of Canadian advertising dollars. And a split-run Sports Illustrated would be the model for other popular American magazines that aimed to get paid twice for the same editorial content.

Once aware and engaged on the file, Heritage Canada improvised on the unenforceable import ban.

The Liberal government of PM Jean Chrétien stepped in with an Excise Tax on US split-runs set at 80% of Canadian revenue, roughly equivalent to the split-runs’ expected profit margins. Following the report of a perfunctory Task Force investigation, the legislation C-103 was introduced in September 1995 and came into force in December 1995.

Previously in January 1995 the US Trade Representative Mickey Kantor had responded to the Country Music TV licensing dispute by threatening unilateral trade sanctions authorized by the notorious section 301 of the US Trade Act, once described as “a stick used to bludgeon the weak.”

But in the case of the Excise Tax on split-run magazines, Kantor chose the less confrontational option of filing a trade dispute.

He decided against taking up his option for dispute resolution under the NAFTA agreement, which included Canada’s exemption of “cultural industries” such as magazines from trade obligations but allowed the US to levy countervailing trade sanctions “of equivalent value.”

Not surprisingly, he filed at the World Trade Organization, alleging Canada’s violation of the General Agreement on Tariffs and Trade (GATT), an agreement containing no cultural exemption.

It’s a matter of speculation why Kantor passed up the opportunity to retaliate immediately on the split-run Excise Tax as he had with CMT. Perhaps there were undisclosed politics in play. Perhaps he was confident of litigation success.

As it turned out, he had reason to be confident.

***

Trade law can be bewildering to the newcomer. It’s based on an overlapping series of commercial contracts between nations.

The Canada-US trade agreements include the bilateral 1987 Free Trade Agreement (CUSFTA) that evolved into the trilateral NAFTA 1994 and USMCA 2017 agreements with Mexico.

Canada and the US are also signatories to the multi-lateral agreements GATT (signed in 1947 but frequently updated) and the more limited 1994 General Agreement on Trade in Services (GATS).

The impetus for the agreements is the principle of trade liberalization. But in practice, that philosophy is more honoured in the breach than the observance. The reality is that nations negotiate these agreements with a view to opening up export markets in other countries while opening up their own as little as possible.

The centrepiece in each agreement is Article I, the Most Favored Nation provision —-nations must not play favourites among foreign exporters—- and also Article III(2) on National Treatment; nations must not discriminate against foreign producers competing with domestic producers.

But in practice the agreements are rife with industry-specific exemptions, exceptions, reservations, limitations, conflicting language and even deliberately ambiguous language papering over irreconcilable differences.

Moreover the agreements do not mesh seamlessly with each other.

GATT governs trade in “goods.” GATS governs trade in “services.” But in spite of a clear schedule in GATS specifying which products are “services,” it is possible for products to be both a good and a service (as we discovered in the split-run litigation).

NAFTA governs both good and services but exempts “cultural industries” which GATT and GATS do not. 

Those cultural industries make “goods” like magazines and music CDs, but also “services” like film, broadcasting and other audio-visual products. Canada has taken advantage of GATS’ opt-out for our cultural “services.”

So it is different rules for different agreements, and —to make it even more messy— the agreements permit forum shopping for dispute resolution at the WTO (for violations of GATT and GATS) or trade arbitration (for violations of NAFTA/USMCA).

***

There’s no deeper rabbit hole than legal analyses of the WTO split-run magazine case. It’s been the subject of many scholarly articles.

The bottom line is the Americans won. They won at the initial WTO adjudication and won even bigger on appeal, issued June 30, 1997.

Predictably, the import ban on magazines went down in flames as an impermissible quota (of zero) in violation of Article XI(1) of GATT. Given the new technology of cross-border transmission of pages, the ban was toothless anyway.

The Excise Tax in Bill C-103 was also struck down.

Canada defended the tax as a levy on “advertising services” listed under a GATS schedule to which Canada had never subscribed and was not bound.

The WTO didn’t buy it, ruling that the tax was levied per issue on magazines that were consumer “goods” even if they included “advertising services.”

The WTO panel reasoned that a product could be both a good and a service, so GATT still applied. The panel still had to perform some interpretive gymnastics in order to hold that the split-runs void of any Canadian content were “like products” to Canadian magazines, but they found a way. The tax was ruled unlawful.

That wasn’t all.

The US also decided that, since all is fair in a love, war and trade disputes, it would take the opportunity to challenge successfully Canada Post’s rate subsidy for Canadian magazines as discrimination in the distribution of goods contrary to GATT Article III(4).

The postal rate issue was not a total defeat for Canada: it was still open to the federal government to recraft the preferential postal rate for Canadian magazines by paying subsidies directly to 1400 magazine owners.

As a side note (because it became relevant in the final settlement in 1999), the US never challenged section 19.1 of Canada’s Income Tax Act which restricted Canadian businesses’ right to deduct magazine advertising expenses to ads published in Canadian owned periodicals.

***

The Canadian magazine industry viewed the WTO ruling as an existential defeat.

But it had a sympathetic ear from Heritage Minister Sheila Copps, the take-no-prisoners MP from Hamilton, Ontario.

Her response was Bill C-55 tabled in the House on October 8, 1998. Figuring they had a workaround on the WTO ruling that the Excise Tax was an illegal levy on the “goods” of hard copy magazines, Heritage officials devised new legislation that prohibited foreign magazine publishers from selling advertising to Canadians. “Advertising services” were covered by GATS, not GATT, and Canada was not bound.

US officials denounced the Bill. The new US Trade Representative Charlene Barshefsky accused Canada of thumbing its nose at the WTO adjudication process and said C-55 was “unabashedly protectionist.”

Retaliatory trade sanctions were in the cards and even if the US had chosen to play by NAFTA trade rules it had the right under that agreement to countervail the protection of Canadian magazines with sanctions in any sector, although crucially of equivalent commercial effect.

Of course Barshefsky and the Clinton administration had no intention of launching equivalent retaliation, just as they had ignored the same principle in the Country TV Music dispute. Importantly, the stakes in the magazine dispute, while difficult to quantify precisely, were of an order of magnitude larger than the cable TV dispute.

Clinton was under pressure from Congress on the trade file, according to an analysis in the Globe & Mail. He wanted Congress to delegate more negotiating autonomy to the US Trade Representative and to get it he continually had to deliver trade wins. Canada’s insolent defiance of the WTO ruling wasn’t helpful.

On the Canadian side, Heritage Minister Copps had the magazine industry’s back and the Liberals’ Ontario caucus was said to be hawkish on cultural issues.

A predictable policy tension existed between Heritage and Trade Minister Sergio Marchi, but the Prime Minister went out of his way to publicly back Copps and C-55.

The Reform Party was vocally opposed to Canadian cultural policy in general and had demonstrated this during the Country Music TV dispute.

Clinton knew exactly how to play his cards.

***

On January 11, 1999 deputy US Trade Representative Richard Fisher met with Canadian Ambassador Raymond Chrétien in Washington D.C. He gave Chrétien the expected ultimatum: withdraw Bill C-55 and comply with the WTO ruling, or else.

As it was an informal meeting, the “or else” was never written down or published, rather it was passed on by both sides to news media by leak or unattributed statements.

The “or else” was a series of US ‘section 301’ retaliations in the form of trade tariffs or bans on Canadian products in steel, plastics, clothing and also wood products not already restricted by the softwood lumber agreement between the two countries.

Canadian officials put a dollar value on the proposed retaliations at $3 billion to $4 billion, figures that were neither documented nor officially confirmed by either side. Later, an American publication reported an unattributed number of $650 million (USD), closer to $1 billion CDN.

As in the CMT dispute, the retaliations would be of far greater than “equivalent” value to US losses and, unlike the CMT dispute, they would be delivered in key sectors outside of Canada’s cultural industry.

The US choice of retaliation sectors were customized for the two leading Canadian Ministers on the file. MP Copps represented Hamilton, the home of Canada’s steel industry. Trade Minister Marchi’s Toronto riding was host to several plastics factories.

Copps’ public response was to defend C-55 as trade compliant and invite the US to seek dispute resolution.

Litigation would have provided an excellent political off-ramp for the Canadian government. But the Americans had no intention of doing so having in their view already won at the WTO.

It’s also possible Copps was getting encouraging legal advice on the merits of C-55’s workaround on the original WTO ruling. But an article written a year later by a young Yasir Naqvi (destined to be Ontario’s Attorney-General) is convincing that our chances were less than 50/50.

Canada also had the option of launching our own trade complaints against the overreaching section 301 retaliations as either slam dunk violations of GATT or non-equivalent retaliation under NAFTA.

But of course that would take time, and the US retaliation strategy was to create facts on the ground for Canadian politicians.

***

The American divide and conquer tactics enjoyed considerable success.

The opposition Reform Party did not support any of the tools in the Canadian cultural policy toolkit and was not averse to saying so in the middle of a trade dispute as evidenced during the 1995 Parliamentary debate over the Country Music TV dispute.

Reform Heritage critic MP Inky Mark castigated C-55 investigators (armed with powers of search and seizure) as “culture police.”

MP Jason Kenney told the House “the bill is folly. I have not had a single one of my constituents call me to ask for this kind of protectionism. But many have called to say ‘Please do not let this crazy effort by the Minister of Heritage destroy our jobs and impair our industry by provoking the Americans into a bilateral trade war.’”

The Reform caucus promised to bog the Bill down in Parliamentary delay tactics but in fact C-55 spent only a month in Parliamentary Committee and spanned five months from first to third reading.

The Americans’ prime ally was the Association of Canadian Advertisers. Already opposed to existing rules against corporate tax deductions for advertising in non-Canadian media, the ACA viewed C-55 as just another obstacle to lower advertising prices.

Association President Ron Lund portrayed C-55 as a sweetheart deal for the two dominant Canadian magazine companies, Telemedia and Rogers. The US Trade Representative was quick to pick up the talking point.

Perhaps the most disappointing Canadian voice in the debate was the Wholesale Remanufacturing Lumber Association which launched a public campaign opposing the Bill. No Canadian industry had drawn down more on the federal government’s political capital battling US trade sanctions in the previous 50 years than the Canadian industry in wood products.

In Copps’ hometown of Hamilton, the CEO of steel giant Dofasco, Gord Forstner, wrote a scathing letter to the Prime Minister opposing C-55 and then promptly leaked it to the Press.

In retort, Copps got support from the Steelworkers’ Canadian chief Lawrence McBrearty who denounced the sanction threats.

“Maybe,” he told a Parliamentary committee, “someone thinks it’s just fine to have a regime for trade in goods and services that does nothing to prevent the kind of blackmail on cultural policy that the U.S. is attempting with the linkage to steel trade…Canadians, and Canadian steelworkers, cannot allow this kind of blackmail to succeed.”

And this story is not complete without an anecdote that was both repugnant and heartwarming.

A week after trade sanctions were threatened, the Canadian edition of the pornographic Hustler magazine published its February issue that included a vulgar “contest” targeting Copps.

Copps sued and the magazine publisher issued a public apology in the Hamilton Spectator. More importantly, 600 Canadian retail outlets pulled the February issue from their shelves.

***

Negotiations began in February 1999 and ran on and off for three months with the typical mix of posturing and conciliatory statements that characterizes bargaining in the public eye.

Trial balloons for a compromise were floated in both US and Canadian press reports from unattributed sources. These included capping the number of split run magazines that could be sold or joint ventures between Canadian and American magazine owners. The latter idea was advocated by the Association of Canadian Advertisers.

A joint venture had been part of the solution to the Country Music TV dispute three years earlier. Westinghouse had agreed to a 33% share of the Canadian channel that had knocked them off of the cable dial and then licensed their American brand and content back to the joint entity.

The oncoming Third Reading of the Bill in the House of Commons on March 16th provided a bargaining deadline. It was anticipated that the US Trade Representative would have to respond to the vote by officially publishing its retaliation list and triggering a 90-day countdown to implementation.

This end-game dynamic must have resulted in a framework of a deal. Four days before the vote, deputy US Trade Representative Fisher announced the US had no immediate plans to publish the list. “I hope it does not become necessary,” he said, “because we are making progress on this issue. Perhaps quite unusual for Americans, we are willing to exercise a modicum of patience. I think this thing has run down the track much further than it needs to run.”

Copps responded with similar encouragement and then pointedly added “the Americans have to “do their homework on content.”

In the House, Copps added that “any future discussions must hinge on the concept of majority Canadian content.”

In retrospect, it seems that in early March a framework deal was in place with hard bargaining remaining to put numbers to the percentages of advertising market share and the amount of Canadian content in split-runs.

On March 16th C-55 passed Third Reading by a 196-43 vote.

***

On May 26th a deal in principle was announced.

The terms were as follows:

* US split-run magazines were allowed to earn up to 18% of their advertising revenue from the Canadian market. Bill C-55 would be amended to include this in a new section 21.1.

* Split-runs could exceed the 18% cap of Canadian ads if they published a majority of Canadian editorial content.

* If a split-run had at least 50% Canadian content, Canadian advertisers could claim 50% of their advertising expenses on their corporate tax returns. If the split run attained 80% Canadian editorial content, advertisers could claim 100% of advertising expenses. These changes to section 19.1 of the Income Tax Act were made a year later in June 2000. Significantly, the change in tax policy was not required by the WTO ruling, nor had it even been challenged by the US.

* The US waived any objection to Canada introducing direct federal subsidies to Canadian magazines. This was a “gimme”: direct subsidies are presumptively trade compliant under GATT. A year later the Liberals introduced a three-year $50 million annual subsidy program in the 2000-2001 budget and rebooted the postal subsidy program through a WTO-compliant direct postal reimbursement to magazine owners.

* Canada would allow foreign publishers to set up shop in Canada and own 100% of any newly established (but not existing) Canadian based magazine, provided the business met the section 38 ‘net benefit to Canada’ test in the Investment Act. The test included compliance with cultural policy, Canadian editorial content, competitive impact, and contribution to the Canadian economy. A crucial caveat was that the test would be administered by Minister of Heritage, not Investment Canada.

The breadth of the agreement must have come as a shock to outside observers.

American ownership of Canadian magazines and changes to the Income Tax Act were not even on the table during the WTO litigation of the Excise Tax. An American waiver on federal subsidies to magazines was not a concession, it was forbearance on future trade harassment.

The key trade off in the deal appeared to be the 18% limit on split-runs’ freedom to sell Canadian advertising in exchange for incentives for US split-runs to carry a majority of Canadian editorial content, even to the point of owning Canadian magazines. The guiding policy principle was more Canadian content, regardless of who published it.

Next came the official government statements.

Copps issued the perfunctory claim of victory: “The US has firmly recognized Canada’s right to protect culture in international trade agreements. I think this is a win-win for Canada.”

Not long afterwards she conceded that threats of trade retaliation had forced the compromise.

“I live in the world of the possible. I wanted a good loss. What we have here is a good loss. I think it’s a good defensible compromise….I haven’t been a political idiot and I’m not going to start now.”

US Trade Representative Barshefsky issued a dignified statement on May 26th: “I am pleased we have negotiated a settlement to this long standing dispute with our largest trading partner. This is how the dispute settlement system should work. The agreement opens Canada’s magazine market and in so doing offers clear benefits to both Canada and the United States.”

But in a Washington Post report the following day, US officials appeared to gloat, saying anything Canada got out of the deal was purely a courtesy shown by President Clinton in recognition of his good relationship with Prime Minister Chrétien.

A more diplomatic source in Barshefsky’s office told the Post “our right under normal rules of trade is to have full and open competition…The agreement gives reasonable but not unfettered access to our publishers to Canada’s advertising market.”

As for domestic Canadian reaction, it was mixed.

Cultural nationalist voices denounced it. But the lead editorial in the Liberal-friendly (and nationalist) Toronto Star pronounced the deal a reasonable compromise.

Ron Lund of the Association of Canadian Advertisers was naturally pleased and declared the agreement “a great first step in terms of opening markets.”

The Canadian magazine industry was hugely disappointed even though publishers had seen this moment coming for some time.

The chair of the Canadian Magazine Publishers Association John Thomson said “the risk that US publishers will offer discounted advertising and subscription rates in order to capture Canadian market share is great.”

He predicted that discounted advertising rates offered by a flood of US split-runs would drive a large number of Canadian magazines out of business in the next three years.

Even with hindsight it is difficult to declare the split-run deal a win, loss or draw for Canadian cultural policy given the American leverage of a favourable WTO ruling on the Excise Tax, the uncertainty over any future WTO ruling on Bill C-55, and of course the considerable threat of US sanctions.

In her post-mortem of the deal, Toronto Star political reporter Rosemary Speirs opined that Copps would have preferred to litigate C-55 at the WTO (an option not practically available to the Minister) and that it was Chrétien who had taken control of the file and negotiated the final agreement.

In her 2005 autobiography, Copps concedes without rancour that the Prime Minister’s Office did the deal and even embellished the account by claiming that Chrétien’s friendship with Clinton dislodged Barshefsky’s more extreme positions.

Speirs concluded that Copps salvaged from the wreckage promises from the PMO to launch a significant subsidy program as well as transferring control over foreign investment in Canadian magazines to Heritage.

***

It would require an in-depth investigation beyond the reach of this post to measure the impact of the 1999 split-run settlement on the fortunes of the Canadian magazine industry.

Five years later Sheila Copps suggested in her autobiography that the magazine industry was doing alright. Canadian communications lawyer Peter Grant made the same observation that year in his book on Canadian cultural policy, Blockbusters and Trade Wars.

In fact in his 2013 Changing Channels autobiography, Grant offered an explanation of why the Canadian magazine market did not end up being overrun by US split-runs.

The 18% limitation on Canadian advertising in split-run editions meant their publishers had to show American advertising revenue for the other 82%. That meant charging American advertisers extra for inclusion in the Canadian edition.

An analysis of Canada’s magazine advertising market published in 2007 by an American academic reported that US magazines had treaded water in the Canadian market since 1999, while larger English-language Canadian periodicals lost ground to smaller Canadian magazines. To the extent there was a link to the split-run settlement, it’s possible that downward pressure on advertising rates had hurt large Canadian magazines and helped small ones, while fears of American domination of the market were not realized.

The fate of government subsidies deserves its own study as well. The magazine industry had not sought out subsidies as its consolation prize, fearing future governments would get tired of the expense, which according to one analysis is exactly what happened during the Harper administration.

By the 2010s the industry landscape would be forever altered by the availability of free online content and the rise of online advertising Goliaths, Facebook and Google.

The Canadian Periodical Fund still provides subsidies to Canadian-owned magazines in 2023.

***

Campaign ad published in major Canadian newspapers during the 2017 CUSMA negotiations.

What lessons can be drawn from the split-run dispute?

The most obvious is the American ability to create facts on the ground by threatening trade sanctions instead of submitting disputes to either WTO or NAFTA/CUSMA dispute resolution.

As a corollary, we surely can see the leverage accruing to the US when Canadians fall prey to divide and conquer tactics such as sector-targeted trade sanctions, even when they are often illegal and can be ultimately defeated.

Even if playing the short game of negotiating our way out of trade threats, we can see the value of Canadian solidarity in driving an acceptable outcome. These deals get done. To the extent that the result of the split-run agreement was a disappointment to Canadian cultural nationalists, that was driven mostly by the Americans’ ability to capitalize on the vulnerability of magazines to GATT rules as a “good,” which is not the case for audio-visual based media.

It’s also possible that lessons from the Country Music TV and split-run disputes have been over-learned by Canadian politicians and especially federal civil servants responsible for advising them.

If you close your eyes you can imagine the risk-averse advice given to current Heritage Minister Pablo Rodriguez over at least two controversial elements within Bill C-11: the lack of guaranteed access of Canadian programming services to foreign online platforms [ss. 9(1)(h,i)] and the lesser obligations of US streamers and studios to hire Canadian talent when making Canadian content [s.3(1)(f)].

A final lesson is an obvious one: the US regards Canada as an extension of its domestic market for cultural products. That will never change. We will have to keep defending our cultural policy toolkit from the Americans and, by now, they have come to expect it.


***

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Catching up on MediaPolicy.ca – Rogers Shaw merger delivers more drama – the bully tactics of US trade politics – analysis of the DVS/Fox News libel suit.

Innovation Minister François-Philippe Champagne

January 14, 2023

The buzz is building in anticipation of the Competition Commissioner’s appeal against the approval of the Rogers-Shaw merger. The January 24th court date takes place under the shadow of a financing deadline at the end of the month.

MediaPolicy.ca made this observation about the merger ruling in this week’s post here: Commissioner Matthew Boswell got his hat handed to him by the Competition Tribunal and might have been better off using the threat of litigation to forge a settlement reducing wireline and wireless prices.

The response to the Tribunal ruling from the feisty telco re-seller TekSavvy was to issue a press release challenging ISED Minister François-Philippe Champagne to veto the merger.

TekSavvy is promising an “undue preference” complaint to the CRTC, alleging Rogers saved its merger deal only by giving Québecor’s Vidéotron a special wholesale broadband price to enter the B.C. and Alberta markets as an Internet re-seller piggybacking on Rogers’ networks. Presumably, TekSavvy wants the same deal.

Lower wholesale prices for ISP re-sellers was on TekSavvy’s original list of demands to the Minister when the Rogers-Shaw merger was announced in March 2021.

ISP re-sellers like TekSavvy are underweighted in the West, the vast majority of their business is done in Ontario and Québec. The Vidéotron discount with Rogers kicks in after a significant number of new customers are signed up.

The January 24th appeal isn’t the only thing creating a buzz of anticipation however.

Yesterday the Globe and Mail reported that the House of Commons Industry & Technology (INDU) Committee plans to convene renewed hearings on the merger. In March 2022 the Committee, made up of MPs from all parties, unanimously opposed the merger.

This time the Committee agenda appears to be a consideration of the choice of Vidéotron as the buyer of Shaw’s Freedom Wireless, a deal that was announced in August 2022.

Québecor CEO P.K. Pélédeau confirmed to the Globe he would attend the INDU proceedings on January 25th, the day following the Court of Appeal hearing. A representative of an unsuccessful bidder for Freedom Wireless, Globalive, also confirmed attendance.

What’s intriguing about the Globe’s reporting is the absence of comment (as of yesterday) of the Minister or the chair of the INDU committee, Liberal MP Joël Lightbound from Québec City.

Just another twist in the tale.

***

If you are curious about the chances of the Dominion Voting Systems libel lawsuit against Fox News, the Washington Post’s George Will wrote an excellent analysis this week.

***

The Canadian Press released a story on the US Embassy suggesting Bill C-11 might not be trade compliant. The Embassy’s measured words were the same that were put on the record by US Trade Representative Katherine Tai last year.

It is a tiresome if regular feature of US politics that the White House and the US Trade Representative do solids for US companies coveting Canadian market share by issuing veiled threats of trade complaints.

It’s not clear whether it’s Google or the Hollywood studios behind this latest one, but the threats have no legal merit.

In a serendipitous moment, a trade dispute resolution panel ruled this week in Canada’s favour and against the US violation of the CUSMA deal on auto parts.

***

It’s anyone’s guess at how the American version of Bill C-18 will fare in the forthcoming mayhem of the House of Representatives. The Journalism Competition and Preservation Act was introduced in the Senate last summer and didn’t make the cut for inclusion in the lame duck omnibus funding Bill in December.

Journalist unions have taken different approaches to endorsing or qualifying their support for this kind of legislation. A Press Gazette story contrasts the different approaches of the US Newsguild and the British National Union of Journalists for similar legislation proposed in the UK.

***

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Rogers – Shaw: how wireless consumers lost (but not for the reason you’re thinking).

Competition Bureau Commissioner Matthew Boswell [Dave Chan/Globe & Mail]

January 10, 2023

The least surprising thing about the Rogers-Shaw merger was that the Competition Tribunal rejected Competition Commissioner Matthew Boswell’s attempt to block it.

Rogers’ acquisition of Shaw’s wireline cable TV (already approved by the CRTC) and Internet broadband operations in provinces where Rogers had no presence meant the Commissioner could never seriously contest the lion’s share of the $26 billion merger.

What was left to fight over was wireless. Boswell got a helping hand in March 2022 from Innovation Minister François-Philippe Champagne who made it clear he would veto the transfer of radio spectrum unless Brad Shaw found a different buyer for most of his wireless assets held in Shaw Mobile and Freedom Wireless.

Québecor’s P.K. Pélédeau emerged in August as the divestiture winner, agreeing with Shaw to take the larger Freedom operations off his hands at a discount

Not in the least appeased, Boswell said the divestiture to Québecor changed nothing for him because its Vidéotron operation would be too weak a replacement for the market disrupting Freedom.

In due course Commissioner Boswell realized that he couldn’t make his case of “substantially prevented and lessened competition” stick in Ontario, home to the vast majority of Freedom’s 2.2 million customers, and abandoned that line of attack against the merger.

That left him seeking to block the entire merger by zeroing in on Rogers’ acquisition of Shaw’s wireless businesses in Alberta and British Columbia: Shaw Mobile (a discount plan bundled with Shaw’s wireline customers) and Freedom Wireless (which Vidéotron was buying).

On December 31st the Commissioner lost even that claim in a lop-sided Tribunal decision that one industry analyst cruelly but accurately described as a “smackdown.”

In a 413-paragraph ruling written by federal court judge Paul Crampton presiding as panel chair, the Tribunal rejected all of Boswell’s pricing projections in both a no-merger and a post-merger market.  In doing so, it preferred Rogers’ expert witnesses over the Commissioner’s experts with a candour that was stinging at times.

The Tribunal also categorically affirmed Vidéotron as an equally (or even more than equally) strong wireless provider as the existing Freedom, whether bundling service with Québecor’s VMedia wireline or as stand-alone wireless. In fact the Tribunal observed with satisfaction that divestiture of Freedom to Vidéotron would give birth to Canada’s elusive fourth national wireless carrier, the holy grail of government policy in wireless competition over the last decade.

Not taking its foot off the pedal, the Tribunal also said that the cumulative effect of the Shaw-Rogers merger, the expansion of Vidéotron’s national footprint, and the competitive response of Telus and Bell in capital-intensive competition in fifth generation wireless networks is a pro-competitive outcome for consumers.

With so many findings of facts going against the Commissioner’s case, the Tribunal left little room for a successful appeal of its ruling. Of course the Commissioner remains undaunted and the Federal Court of Appeal will hear his case on January 24th.

If as some reports indicate Boswell will be telling the Court that the Tribunal erred in law by failing to review the merger in its original form without divestitures, he is going to struggle.

As a more practical alternative, he is prepared to argue that the mitigating effect of the Freedom/Vidéotron divestiture should only have been considered by the Tribunal once a finding was made about the competitive effects of the merger as initially proposed in March 2021.

Making that case requires the Commissioner to convince the Court of the pivotal importance of a hair-splitting legal argument over who bears the evidentiary burden of proof on whether Vidéotron is a suitable heir to Freedom’s mantle as market disruptor, him or Rogers. 

Anticipating this appeal argument, the Tribunal ruled that even if Rogers carried the burden of proof on the divestiture issue, it met it.

As a labour arbitrator once told me when I tried to tip a difficult case my way based on which litigation party bore the evidentiary onus, “in forty years I’ve never decided a case on that basis.” I expect the Federal Court of Appeal will feel the same, but we’ll see.

When it’s over, the post-mortem will begin. Or continue, because it’s already begun with critics describing this iconic merger as the bellwether case for badly needed reforms to Canadian competition law.

It may or may not be that, but in the meantime as everyone agrees there are millions of Canadian wireline and wireless subscribers who would appreciate lower monthly bills.

If the Commissioner loses his appeal, he will have to consider whether he squandered his considerable litigation leverage over Rogers and Shaw who have hardly disguised their desperation to obtain approval of their merger before a January 31st financing deadline. 

At least the question will be asked of the Commissioner whether he could have obtained greater concessions from all parties concerned, including the federal Minister, on long-term pricing or even improved access for re-sellers of wireless and broadband services to national fiber and 5G networks.

That might be an even better outcome for consumers than a Tribunal decision based on expert projections.

***

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Catching Up on MediaPolicy.ca – capitulating on cultural trade? – Rogers-Shaw update – Massive EU fine for Facebook.

January 7, 2023

MediaPolicy.ca was able to shake off the holiday season lethargy and publish a long post on one of the few cultural trade disputes we have had with the Americans. 

This one was the 1995 battle that broke out after the CRTC allowed the TV licence of an American music video station to expire and replaced it with a Canadian start-up.

The Clinton Administration threatened a half billion dollars in trade retaliation. You be the judge of whether Canada “capitulated” or responded pragmatically. Either way, it’s a valuable history lesson for followers of the debate over C-11 and C-18.

***

As media policy buffs you are probably up to date on the Competition Tribunal’s approval of the Rogers-Shaw merger and rejection of the Competition Bureau’s attempt to block it.

If not, the Globe, the Star and the Financial Post always do a good job reporting on it. The Tribunal decision itself is easier to read than you think; you can read the “bottom line” ruling or the full reasons.

To provide a condensed summary right here, the Tribunal ruled that the merger “is likely” (everything about competition law is about ‘what is likely’) to increase wireless competition in B.C. and Alberta rather than decrease it.

The Bureau is contesting the ruling and we will likely have the results from the Federal Court of Appeal by the end of January.

Most of the published criticism of the Tribunal decision is intensely partisan as anything pertaining to telecommunications regulation tends to be. Professor Jennifer Quaid offers a detached criticism of the ruling here.

***

It seems we can always count on the European Union to move the yardsticks on regulating American Big Tech.

The latest is a EU ruling that invalidates Facebook’s terms-of-service waiver of EU users’ rights to opt out of personally targeted advertising. The decision comes with a 390 million Euro fine for past transgressions. More importantly, the New York Times story predicts future compliance will shave five to seven per cent off of Facebook advertising revenues. 

Big Tech companies prefer homogenous regulatory compliance (or none) across multiple jurisdictions. With US Congress mostly inactive, the Australian/Canadian news compensation legislation and European GDPR regulations are growing the compliance gap.

***

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The half-billion dollar trade war that wasn’t. The story of Country Music Television.

25-minute read

January 5, 2023

On June 6, 1994 the CRTC decided not to renew the licence of an American specialty channel, Country Music Television.

Following its policy of fostering Canadian channels and Canadian programming, the Commission awarded the licence for the only country music video service on cable TV to the Calgary-based start-up New Country Network.

Within a year, the Commission’s decision was reputed to have brought Canada to the brink of a half-billion-dollar cultural trade war with the United States.

In 2023 as trade consequences are predicted or threatened if Parliament passes Bills C-18 and C-11, it’s worth retelling the story of Country Music Television.

***

In the mid-1990s the licences of Canadian and American specialty channels on cable TV approached expiry and renewal. That triggered the CRTC’s well-known policy for licensing no more than one station, Canadian-owned, in each programming genre.

Not yet the 500-channel universe in 1994, the CRTC’s array of licensed specialty television services totalled 20 Canadian and 12 American channels. The US channels included A&E, CNN, CNBC, The Learning Channel, Black Entertainment Television, The Nashville Network, and Country Music Television.

The Commission’s policy was to encourage Canadian-owned channels offering both Canadian and foreign content, regardless of the availability of American programmers who dwarfed Canadian competitors but offered little or no Canadian content.

American programmers who jumped into the Canadian specialty TV market in the 1980s by grace of a CRTC licence knew they were renters, not owners.

One of them was the music video channel Country Music Television (CMT), a joint venture of US giant Westinghouse and Gaylord Entertainment. Gaylord also owned the ‘country lifestyle’ station, The Nashville Network (TNN).

CMT was big in the US market with 24 million subscribers. Its Canadian foothold was two million subscribers and a $1.2 million annual profit. The Nashville Network was more firmly established in Canada with four million subscribers (no Canadian programmer applied to displace TNN).

It was not complicated for a music video channel to launch with content licensed from major US record labels: the challenge was to produce the Canadian content sufficient to meet the CRTC’s expectation of at least thirty per cent Canadian artists. When the CRTC notified Westinghouse in 1993 that it was contemplating displacing CMT with a Canadian programmer, CMT was at one per cent Canadian content.

Five Canadian applicants queued up for CMT’s slot. Based on subscriber price and Canadian content commitments, the licence went to the “New Country Network” (NCN). The start-up was co-owned 60/40 by MacLean Hunter (about to be purchased by Rogers) and Rawlco Inc., the Saskatchewan radio broadcaster. Provided CMT was pushed out of the market, NCN was projected to reach six million Canadian households.

On June 6, 1994 as expected the Commission ruled against renewing CMT’s licence in three sentences:

The applicant [New Country Network] requested that the Commission delete Country Music Television (CMT), a U.S. service in a competitive format, from the Commission’s lists of eligible satellite services. [It] is the Commission’s policy that, where a Canadian service is licensed in a format competitive to that of an authorized non-Canadian satellite service, the authority for the cable carriage of the non-Canadian service could be terminated. Accordingly…the Commission has authorized cable licensees to continue to distribute CMT only until such time as The Country Network’s service first becomes available for distribution to affiliates.

Westinghouse didn’t take it well. Despite being informed when obtaining the licence in 1984 of CRTC policy on Canadian content, it characterized the loss of its publicly granted licence as confiscation of private property. 

Inflaming matters, the CRTC had denied Westinghouse standing at the licence hearing because it found the pre-hearing written submissions to be adequate. Its lawyers called that a denial of natural justice and marched off to the Federal Court of Appeal. The court issued a denial on December 20, 1994 and leave to appeal was refused by the Supreme Court a month later.

On January 1, 1995 NCN launched on Canadian cable and CMT was removed.

***

Jean Chrétien’s Liberals had swept to power with a majority government on October 25, 1993. 

That was the federal election in which Brian Mulroney’s Progressive Conservative government —lead by his successor as Prime Minister, Kim Campbell— crashed from a majority of 156 seats in Parliament to only two. Aside from bringing the Liberals back to power, the chief benefactors of the Tory implosion were the ascending Bloc Québécois and the Reform Party.

Eleven months later on September 12, 1994 the separatist Parti Québécois lead by Jacques Parizeau came to power in Québec on a promise to hold a referendum on sovereignty association. The very real prospect of a national divorce hung over the country for the next twelve months until on October 30, 1995 the breakup of Canada failed by a ‘Non’ vote of 50.58%. During those thirteen months, invoking cultural nationalism was at a premium in Parliamentary and public debate.

It was also a time for a surge in trade squabbles between Canada and the US, despite the fresh ink on the US-Canada-Mexico NAFTA that came into effect January 1, 1994. But as if to prove the negotiator’s aphorism that nobody ever stays bought, during the early months of 1995 trade complaints continued on both sides of the border. Canadian access to the US sugar market and the perennial issue of Canada’s agricultural supply management were sore points at the time.

Of course there was no prospect of the Liberal government ignoring cultural issues with the nationalist minded Bloc Québécois nipping at their heels in the House of Commons and a sovereignty referendum pending.

For starters, the Chrétien cabinet decided to override the CRTC’s deregulation of satellite distribution that green lit American satellite companies to distribute Canadian television channels. The Liberals’ decision to shut out the Americans and restrict Canadian broadcasting signals to Canadian-owned satellite companies would be announced June 14, 1995, in the middle of the CMT dispute.

The cultural pot was already well stirred. In early 1993 Time Warner had launched a ‘split-run’ Canadian edition of its popular Sports Illustrated magazine. It was a call to arms for the Canadian magazine industry and both the Conservative and Liberal governments paid close attention.

The backstory to the dispute was that in 1965 the federal government slapped an import ban on printed copies of American magazines that solicited Canadian advertising to prevent trade dumping across the border. Like all American cultural products, US magazines recouped their costs in their domestic market and sought to scoop up the Canadian market as a profit windfall of up to 80% of their cover price. That was accomplished by split-runs undercutting Canadian magazine publishers on prices charged to Canadian advertisers, hence the import ban to combat trade dumping.

But when digital technology allowed Time Warner to circumvent the ban by electronically transmitting pages across the border for printing in Toronto, the prospect of US magazines crushing the Canadian magazine industry became highly plausible.

On December 23, 1994 the federal government responded to Time Warner by announcing a profit-neutralizing 80% excise tax on American owned magazines published in Canada, to take effect in twelve months’ time.

The tax arguably discriminated against American goods under the General Agreement on Tariffs and Trade (GATT); ‘arguably’ because there was a dispute about whether Sports Illustrated’s American content was a ‘like product’ to content in Canadian magazines.

Eighteen months later in March 1996 Mickey Kantor, the US Trade Representative in Washington, would file a GATT complaint to the World Trade Organization which ultimately ruled against Canada in 1997.

***

The rumours of the 1995 trade war began with a pop gun blast from Westinghouse.

Days after CMT was expelled from Canadians cable TV on January 1, 1995, Westinghouse announced it was kicking Canadian country artists off CMT’s American channel. The amusing exception to the ban was that it did not apply to Canadians artists signed to the US record labels with whom CMT had binding contracts (and allowed the US Recording Industry Association to support CMT’s complaint).

More seriously, CMT spokespersons served notice they were enlisting US Trade Representative Kantor in their cause.

On December 23, 1994 Westinghouse had filed a trade petition with the Kantor’s office under section 301 of the US Trade Act, co-signed by other US channels operating in Canada, the Recording Industry Association, the National Cable TV Association, and Time Warner. The petition alleged violations of NAFTA chapters on national treatment, fair and equitable treatment, performance requirements, and improper expropriation.

Kantor’s job was to take the steps prescribed under section 301. On February 6th he wrote to Canada’s International Trade Minister Roy MacLaren. As it happened, MacLaren was a self-proclaimed “ardent free-trader” who later wrote in his memoirs that Canada’s cultural trade exemption was “not worth much.”

Kantor’s letter explained to MacLaren that the USTR was calling for public comment to be submitted in the next 30 days with a final decision on trade retaliation by June 21st. Importantly, Kantor asked MacLaren to review the CRTC policy that had expelled CMT from Canadian cable.

Kantor wrote a second letter to the US Federal Communications Commission (FCC) asking for assistance in applying trade sanctions against Canadian businesses operating in the US telecommunications and broadcasting industries.

Kantor’s FCC letter was almost certainly leaked. Media reports on both sides of the border over the next four months invariably cited a “hit list” that included blocking the deal between Canada’s Teleglobe and the US Optel Communications Group on submarine fibre cable; the linking of Telesat’s new Anik satellite to the US network; and CHUM’s Much Music TV broadcasts on the US DirecTV cable network. Reputedly the full hit list was worth $500 million (USD) —-one report put it at $750 million USD—- but no costing ever emerged.

Then Kantor went public, announcing that he was soliciting public comment from American companies on “the most appropriate response to Canada’s actions” and to assess what Canadian television assets the US might subject to retaliation.

“We consider the action taken against CMT to be a very serious matter,” he said. “The CRTC’s action amounts to the confiscation of CMT’s business efforts over the past ten years to serve the Canadian market.”

In case anyone missed the point, Kantor also referenced two other trade combustibles, the split-run excise tax and a simmering copyright dispute over a potential Canadian artists’ levy on blank CDs.

***

Mickey Kantor was a larger-than-life figure.

The 57-year-old Nashville lawyer was the ultimate Democrat insider and Clinton confidante who had quarterbacked the 1992 Presidential election campaign. Kantor’s flinty demeanor was such that the Japanese Trade Minister Ryutaro Hashimoto once described him as “scarier than my wife when I come home drunk.”

As Trade Representative for the world’s biggest economy, Kantor’s desk was piled high with files from around the globe. With NAFTA in the rear view mirror, and the worst of the split-run magazine dispute three years away, the Canada file might have been one of Kantor’s least demanding as revealed by a time line of his three years in the Trade job (already a member of cabinet, he was promoted to Secretary of Commerce in April 1996).

In a lengthy 2002 interview for an oral history project, Kantor recalled the ‘obnoxious’ protectionism of the French government in GATT negotiations (which ended in defeat for the American position on cultural products) and, to quote Kantor’s irritated description, “the issue of media and what they called the cultural exemption.”

Any recollections of Country Music Television did not make the cut.

***

If Kantor was going to play fair, his response to CMT’s petition should have been filed as a NAFTA complaint. That agreement came into effect on January 1, 1994 and renewed Canada’s ‘cultural exemption’ from trade liberalization signed off in our bilateral 1988 Free Trade Agreement with the US.

The cultural exemption meant that Canada did not violate trade rules if discriminating in favour of Canadian interests over American companies within carefully defined ‘cultural industries.’ The caveat was that the US could retaliate with countervailing trade measures ‘of equivalent commercial value’ either on its own cultural turf or in other trade sectors.

According to Canada’s leading communications lawyer Peter Grant, the Americans would have had difficulty making out a prima facie NAFTA complaint against pro-Canadian broadcasting laws, without Canada even having to invoke the cultural exemption. In 2005 Grant wrote:

‘Carefully analyzed, the [cultural exemption] clause permits US retaliation only for measures that otherwise would be inconsistent with the 1988 [Free Trade] agreement. Since Canada made no national commitment in the audiovisual services sector in the 1988 FTA, it is therefore free to introduce new measures affecting such services, including broadcasting, without triggering a right of retaliation.’

Whether or not Kantor disputed that analysis, he was not about to wait around for a trade arbitrator to sort it out. Under the notorious section 301 of US Trade Act 1974, Congress delegated its authority to the USTR to launch unilateral trade sanctions without filing or even alleging a NAFTA complaint. Section 301 has been described by one international trade expert as “a stick used to bludgeon the weak.”

In response to unilateral sanctions, Canada had the right to file its own NAFTA complaint and seek dispute resolution. But the crucial point was that NAFTA dispute resolution did not govern the equivalency of trade retaliation, reasonable or not (although this was remedied in Article 32.6 of the 2019 CUSMA trade deal).

These were the rules of engagement when Kantor began to ratchet up the pressure by setting June 21st as the presumptive deadline for announcing unilateral sanctions.

With Kantor engaged on its behalf, Westinghouse spokesperson Maury Lane played his hyperbolic role by telling a Canadian reporter in early February that “the CMT issue is worth perhaps $100 million…But this move by Kantor could cost the (the Canadian entertainment industry) multi-billions of dollars.” 

Later, Westinghouse revised the $100 million loss figure downwards to $63 million (all figures USD), a fifty-fold multiple of CMT’s annual Canadian $1.2 million cash flow. 

With the American industry baying for blood, Trade Minister MacLaren was eager to cool things down. Responding to Kantor’s February 6th announcement, MacLaren’s spokesperson Bruno Picard denied any trade violation but stated the two countries were far from retaliatory measures.

“There will be a lot of consultation and discussion before any such stage would be reached,” said Picard.

The next day the CMT controversy was raised by the Opposition in the House of Commons when MP Jan Brown button-holed Heritage Minister Michel Dupuy during Question Period. What followed was an exchange that will sound familiar to observers of the 2022 debate over Bill C-11:

Jan Brown (Calgary Southeast – Reform): Yesterday the United States government announced it was considering further retaliatory measures against the Canadian broadcast industry, placing our trading relationship with that country in jeopardy. The minister is moving down the dangerous path of cultural protectionism.

Does the Minister of Canadian Heritage not realize he is harming Canadian culture and Canadian artists by sanctioning the CRTC decision?

Michel Dupuy (Minister of Canadian Heritage): Mr. Speaker, the decision taken by the CRTC is precisely designed to protect Canadian artists and the Canadian cultural industry.

CMT, which is owned by The Nashville Network, was informed by the CRTC when it scheduled in Canada that if there was another channel opened by Canadians it would have to move out. There is no surprise there. The CRTC has taken its decision with full regard to the trade obligations entered into by Canada.

Brown: Mr. Speaker, that is a completely unacceptable answer in this day when technology is being over-ridden by outdated regulations which do not serve our Canadian artists. This is cultural exploitation at its extreme.

My supplementary question is for the same minister. Why is he putting up roadblocks for our very fine Canadian artists? Our cultural industries are among the best in the world. We need liberalization in order to compete more effectively instead of trying to restrict our artists from developing in the international economy.

Dupuy: Mr. Speaker, far from putting up roadblocks, we are opening an information and cultural highway for them with great success.

Two days later on February 9th Westinghouse’s Lane played his next card, this time with less hyperbole and more guile.

In an interview with the Globe and Mail, Lane revealed that following his radio debate with NCN’s Shaun Purdue they had discussed the possibility of a joint venture between CMT and NCN in Canada.

Lane said that CMT expected to be granted a minority ownership position in NCN for free: ‘don’t count on me paying for ground I’ve already paid for.’

Purdue had a suitably nationalist response: “The US probably controls 90 percent of the entertainment market in Canada. Our country is a tenth the size of the US. All Canadians are saying is, ‘For heaven’s sake give us a piece of our own backyard.’”

On February 20 MP Brown was on her feet again in Question Period, predicting a confrontation between the Prime Minister and US President at their upcoming meeting in Ottawa. She asked Trade Minister MacLaren about the potential for US trade retaliation, outside of the cultural sector, a threat the Americans had not made:

Brown: Mr. Speaker, despite those fine words the government is moving toward a policy of protectionism in the cultural industry. Cultural industries will be at the top of the American President’s agenda when he visits this week.

By closing our borders, the government has started a potential trade war with the United States. What form this retaliation will take will be announced by Mickey Kantor on March 6 [Ed. note: this was the deadline for public comment, not USTR action].

When the government meets with Mr. Clinton, will it announce what areas of Canadian trade it is willing to sacrifice to keep up this charade of cultural preservation?

MacLaren: Mr. Speaker, we are unwilling to sacrifice any area of Canadian trade. The member raises a question that will indeed be touched upon in my meetings with Mr. Kantor. 

On that occasion we shall continue to assure him, as we have done in the past, that the Canadian measures to promote Canadian culture are entirely consistent with our international trade obligations.

(Emphasis Added)

The confrontation didn’t materialize. 

Far from it, the televised Joint Press Conference at the conclusion of the leaders’ meeting on February 23-24 was a love-in, despite the fact that there were active trades file in culture, sugar, and agricultural supply management. According to news reports, the good vibe was deliberate.

Clinton and Chrétien both heralded their signature of the Open Skies Aviation Agreement and extolled the merits of global trade. Neither leader mentioned cultural flashpoints, nor were they asked questions on the topic. Chrétien praised “a great meeting” and said the parties were “working on problems and finding solutions.”

Of course the solution Kantor wanted on the culture file was a change in CRTC policy to protect the licences of other US stations operating in Canada. The Canadian government had the power under section 7(1) of the Broadcasting Act to give policy directions to the CRTC but section 7(2) prohibited those powers being applied directly to licensing decisions.

As if by divine providence, two years later the CRTC changed its policy and then shortly afterwards granted licence renewals to US channels TNN, CNN, CNBC, A&E, The Weather Channel, BET and a number of local superstations.

A news report from the Financial Post on March 21st appeared to reveal a gap between the two cabinet Ministers, MacLaren and Dupuy.

MacLaren had reassured Kantor in writing on March 7th that there were no pending licence renewals for American stations for the next twelve months and, more significantly, the Heritage Department was reviewing its entire TV policy over the next several months and the Canadian government “expects these reviews to cover the regulation of foreign specialty broadcast services.”

Confronted with the Trade Minister’s remarks about the activities of Canadian Heritage and the CRTC, Dupuy wisely replied “we have no intention to direct the CRTC on the question.”

As to whether his own Department was reviewing the issue, Dupuy was evasive but a Heritage official told the Post that foreign specialty channels “could” be reviewed by the Department or even the CRTC as part of its ongoing review of media Convergence.

***

The wind shifted sometime in March.

On March 23, 1995 Kantor spoke for an hour to the National Press Council in Washington D.C., giving an update on the major trade issues of the day with GATT, China, Mexico and Japan. The Clinton administration was on the defensive over trade, thanks to the controversy over the NAFTA deal with low-wage Mexico and an as yet unsuccessful effort to pry open the Japanese market in auto parts.

Perhaps because of those other challenges, Kantor reserved special praise for the US relationship with Canada, its largest export market. 

[90-second video clip from C-Span]

In such an extensive trade relationship, he said, there are going to be “annoyances” that are managed effectively, citing beer and timber disputes. 

“And,” he added cryptically, “we are going to be able to resolve I think the cultural, the so called cultural issues successfully. We are deeply grateful to our Canadian counterparts for that.”

The issue ran on silent mode until just before the June 21st sanctions deadline.

On the morning of the 21st, the Globe and Mail reported that MacLaren and Kantor had discussed the CMT matter again on June 16th in Halifax at the G7 meeting.

In the same news report, the Globe cited “several sources” that Kantor regarded the $500 million figure as “overkill” and “not calibrated” to the loss suffered by CMT. The sources also said that retaliation would be restricted to Canadian cultural products and would not spill over into other sectors.

MacLaren was sending out signals too. In the same Globe report, the Minister’s spokesperson said “we can change the [CRTC] policy but we can’t go back and change a [licence] ruling.” This was the first reliable indication that the Canadian government was going to bend to the American position on future licence renewals.

Later that day New Country Network announced CMT as its minority partner holding a 20 per cent stake in NCN, the maximum foreign ownership permitted under CRTC rules. NCN would be rebranded as Country Music TV.

Westinghouse publicly withdrew its section 301 petition requesting sanctions.

Both Kantor and MacLaren expressed pleasure at the resolution.

Rawlco’s CEO Gordon Rawlinson was conciliatory, conceding publicly that Country Music TV was better branding than New Country Network. Any acrimony with Westinghouse was in the past: “they were just expressing how they felt,” he said. “They will be good partners.”

As for Kantor, he had one more thing to say: “This [CRTC] policy continues by its very existence to threaten the security of other US services currently authorized for distribution in Canada.” Yet he was not announcing sanctions which suggested that he had confidence the CRTC would change its rule about American stations.

Soon more details emerged in the Press and the post-mortem judgment began.

CMT’s equity share came out of Rogers’ ownership stake. Westinghouse was permitted to expand its position from 20 to 33 per cent if the anticipated increase to CRTC foreign ownership limits came to pass, which it did a year later.

No purchase price was announced and it was widely believed Westinghouse paid nothing. The more intriguing commercial arrangements for programming rights and profit distribution were not made public.

CMT President David Hall celebrated the agreement too: “This partnership will create a powerful country music channel.” The subscriber numbers confirmed that observation. Although CMT had been reduced to a minority licensee, it had tripled its viewership from 1.9 to 6 million Canadian households.

Keith Kelly, the National Director of the Canadian Conference of the Arts archly commented in the Globe and Mail “I have a very clear picture of Neville Chamberlain waving a piece of paper and saying ‘we have peace in our time.’”

Greg Quill, the Toronto Star entertainment columnist, called the deal “a capitulation.”

And that was without knowing about the forthcoming change in CRTC licensing policy.

Two days later on June 23, 1995 the Vice Chair of Rogers Phil Lind defended the deal with some significant commentary on Canadian broadcasting:

David Stewart-Patterson (CTV): Yeah. Now, you mentioned levering on the name in terms of the existing name that’s out there in the marketplace, but also the American name. I mean, does it turn Canada’s Country Music Channel into just another American branch plant?

Lind: No, of course not. The channel works very much like it works right now. It has the same management and the same kinds of programming, and everything works the same. But we gain a lot of their experience as well. The other thing we do of course is we assist Canadian country-music artists throughout the world in their quest to be known throughout the world because CMT in the US and CMT internationally has a huge following. And if we can assist Canadian country artists across the world, that’s terrific too.

CTV: Yeah, but I mean, as Rogers, you’re obviously in the middle of this whole convergence process too as technology allows phone companies and cable companies and satellites and so on to compete. Does all that technology really undermine the ability of a government to keep a culture, a country isolated?

Lind: Yes, it does. It means that you have to recognize the realities of what’s going on outside of Canada. But it doesn’t mean you have to abandon your basic principles.

CTV: Yeah, I mean, what are the basic principles that you think we can enforce these days?

Lind: You create strong Canadian entities but, at the same time, you try and make affiliations with international partners. That’s, I think, the essence of where it’s all going.

***

An analysis of the Country Music TV story begs questions about a vision of the Canadian broadcasting industry in its relationship with the juggernaut of the US export industry. Was it a story of capitulation on Canadian cultural sovereignty or a pragmatic recognition of, to use Phil Lind’s words, “the essence of where it’s all going?”

The more troubling question arises from the American threats of trade retaliation and the response of Canadian politicians.

On the US side, the dispute with a Canadian regulator over TV licences was probably a mid-level trade issue at best and not worth blowing up an otherwise positive cross-border relationship.

However the USTR cannot ignore powerful domestic stakeholders. That results in aggressive USTR trade practices thanks to the section 301 cudgel and the defects in enforcement of the NAFTA cultural exemption.

Nevertheless, Kantor seems to have chosen a modestly sized cudgel by limiting the trade retaliation to the cultural sector and, as far as anyone can tell, monetizing the hit list at far less than the “overkill” $500 million.

The more surprising behaviour was demonstrated by Canadian politicians who took credit for defending culture during trade negotiations in 1988 and 1994 and then flinched at the prospect of enforcing those hard-won rights to cultural sovereignty.

We know nothing about any cabinet debate between the free-trader MacLaren and Heritage Minister Dupuy. As for the Prime Minister’s inscrutable role, Chrétien’s shifting perspective on free-trade and the NAFTA agreement is a matter of public record.

As for Canadian opposition critics, they did what they do now: amplify the American threat and propose capitulation.

***

There are several epilogues to the story of Country Music Television.

The first is that the Westinghouse-NCN deal almost fell apart several months later before final signatures. We don’t know the details but Westinghouse claimed in January 1996 that “there remain some pretty large differences.” CMT accused the Canadians of bad faith and demanded “our reinstatement [by the CRTC] in the form of CMT Canada.”

Kantor set a new February 6th deadline for trade sanctions. That deadline was extended to March 7th when the parties signed off “hours before” Kantor was to announce sanctions.

Kantor took the occasion to reiterate the American narrative of “unjust expropriation” of commercial assets and remind the Canadian government that his eye remained firmly fixed upon the upcoming licence renewals for American channels.

The second epilogue was that most of the players in the CMT saga soon went their separate ways.

Perhaps reflecting their exhaustion with trade politics, both Rawlco and Rogers sold their interests in the new NCN/CMT to the Calgary-based Shaw Communications.

Gordon Rawlinson commented “we just felt it was time to get more focussed on radio,” Rawlco’s core business.

In early 1997 Westinghouse bought out Gaylord Entertainment’s interests in CMT and the Nashville Network and folded it into its CBS division where it eventually wound up in Viacom as a Paramount property.

Mickey Kantor became US Secretary of Commerce in April 1996.

Trade Minister Roy MacLaren left cabinet in January 1996 to assume the position of High Commissioner to the United Kingdom.

Heritage Minister Michel Dupuy was shuffled out of cabinet the same month and did not stand for re-election in 1997.

In 1997 the CRTC ruled that American channels would get their licence renewals provided the cable provider maintained a proportionality between Canadian and foreign programmers. This represented the Commission’s third liberalization of its rule on foreign programmers competing with Canadian channels since its strict 1984 policy of licence termination; its 1987 policy of discretionary termination; and its 1993 policy of ‘case by case’ consideration.

Sheila Copps became Minister of Canadian Heritage and inherited the split-run magazine file.

When the WTO struck down the Canadian excise tax in 1997, Copps responded with a workaround through changes to the Income Tax Act in Bill C-55. The USTR retaliated with section 301 steel tariffs hitting Copps’ hometown of Hamilton, Ontario.

But that is another MediaPolicy.ca story for another day.

***

A Postscript on sources:

Finding primary sources online for the “pre-Internet” era of 1995 is a challenge. Regrettably the 1996 Convergence Report issued by Heritage Canada is not available online and it may verify that Canadian reassurances were offered to Mickey Kantor about a change in licensing policy.

There are some good secondary sources on the story of CMT but you will need either a library or credit card.

Garry Neil, Canadian Culture in A Globalized World (2019)

Peter Grant, Blockbusters and Trade Wars (2005)

Andrew Carlson, The Country Music Television Dispute (1997)

Keith Acheson and Christopher Maule, Much Ado About Culture (1999)

***

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Catching up on MediaPolicy.ca – Feds concede defeat in CBC n-word appeal – ‘Viking’ – UK and US online safety- the Torstar divorce

December 24, 2022

The federal Attorney-General’s office has raised the flag of surrender to the CBC’s appeal of the CRTC’s controversial censure of Radio-Canada for on-air references to the title of Pierre Vallières’ classic “N—— blancs d’ Amérique.”

The Radio-Canada hosts’ multiple quotations of mot d’n in the title, once in English and four times in French, were spoken during a consideration of ‘taboo topics,’ in particular the controversy of classroom references to the same book title by a Concordia University professor.

In its filing to the Federal Court of Appeal on behalf of the CRTC, the A-G has plead no contest and backed the dissenting Commissioners on all points. Back in July, MediaPolicy.ca reviewed the Commission majority and dissenting statements here and here.

There can be no doubt the majority Commissioners made a hash of it even though they had the opportunity to review the dissenting comments before publishing, criticisms that the A-G believes are dead on.

Of the many legal errors, perhaps the most puzzling was the majority’s failure to consider whether the offending speech violated the ‘Equitable Portrayal Code‘ that is a condition of licence for the CBC and all broadcasters. Article 10(c) of the Code gives broadcasters the opportunity to rebut the usual presumption that on-air racist vocabulary is a violation of licence:

9. Language and Terminology

Broadcasters shall be sensitive to, and avoid, the usage of derogatory or inappropriate language or terminology in references to individuals or groups based on race, national or ethnic origin, colour, religion, age, gender, sexual orientation, marital status or physical or mental disability.

b) It is understood that language and terminology evolve over time. Some language and terminology may be inappropriate when used with respect to identifiable groups on the basis of their race, national or ethnic origin, colour, religion, age, gender, sexual orientation, marital status or physical or mental disability. Broadcasters shall remain vigilant with respect to the evolving appropriateness or inappropriateness of particular words and phrases, keeping in mind prevailing community standards.

10. Contextual Considerations

Broadcasts may fairly include material that would otherwise appear to breach one of the foregoing provisions in the following contextual circumstances:

a) Legitimate artistic usage: Individuals who are themselves bigoted or intolerant may be part of a fictional or non-fictional program, provided that the program is not itself abusive or unduly discriminatory;

b) Comedic, humorous or satirical usage: Although the comedic, humorous or satirical intention or nature of programming is not an absolute defence with respect to the proscriptions of this Code, it is understood that some comedic, humorous or satirical content, although discriminatory or stereotypical, may be light and relatively inoffensive, rather than abusive or unduly discriminatory;

c) Intellectual treatment: Programming apparently for academic, artistic, humanitarian, journalistic, scientific or research purposes, or otherwise in the public interest, may be broadcast, provided that it: is not abusive or unduly discriminatory; does not incite contempt for, or severely ridicule, an enumerated group; and is not likely to incite or perpetuate hatred against an enumerated group.

The A-G did not take a stand on whether article 10(c) vindicated the CBC as the broadcaster had already complied with the CRTC’s order to apologize.

It’s up to the Federal Court to formally accept the A-G’s surrender. You can download the court file (en français) below. The A-G’s brief begins at page 84 of the PDF.

***

Last week Rupert Murdoch was ‘deposed’ in preparation for Fox News’ defence of a defamation lawsuit filed against it by Dominion Voting Systems (DVS) which was falsely accused by election deniers of having rigged the 2020 Presidential vote count.

This week Fox News personality Sean Hannity was grilled by DVS lawyers about hosting Trump lawyer Sidney Powell who made the false claims on his show.

Hannity claimed he ‘never believed for a minute’ Powell’s false claims even though he did not contradict or question her on their truthfulness. Hannity’s admission will no doubt be relied upon at trial by DVS as proof of Fox’s ‘actual malice,’ the knowing or reckless expression of defamatory statements.

***

If and when the federal Liberals table an online safety bill we will no doubt benchmark the Canadian approach against similar efforts in the US, UK and the EU.

Last week the EU unveiled its Digital Services Act. Its emphasis on the responsibility of online platforms to develop, explain and enforce codes of speech conduct is consistent with the approach promised by Canadian Heritage.

Another legislative tool is being considered in the US Senate, the Democrat-sponsored Platform Accountability and Transparency Act. It would require platforms to share data with independent researchers so that the public has a better view of whether the platforms are living up to their own speech codes.

***

The Globe and Mail’s Joe Castaldo has a piece on the Torstar divorce: the parting of the ways by co-owners Paul Rivett and Jordan Bitove.

One tidbit: Bitove is quoted as saying the Toronto Star is “approaching profitability.” That’s a long distance from Rivett’s public comments about the Star losing $1 million per week. It’s a good thing these folks aren’t a public company.

***

The man who fired CTV news anchor Lisa LaFlamme seems to have landed on his feet upon return from a leave of absence. Former head of CTV News, Michael Melling becomes Bell Media’s VP of Shared Services. His interim replacement Richard Gray has been confirmed in the News job.

***

Oh glorious time of the year when film critics deliver ‘best of’ lists.

Here’s Barry Hertz’s list of ten great CanCon movies. If ‘Viking’ is half as good as its trailer, it will become an oddball classic.

***

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Catching Up on MediaPolicy.ca – The C18 drivers’ guide for Senators – Rupert Murdoch’s date with Supreme Court destiny – Best Media Policy read.

December 17, 2022

You can read MediaPolicy.ca’s summary of where the key amendments, adopted or rejected, landed in Bill C-18 the Online News Act. The prize inside is a PDF of the amended House Bill that will move on to the Senate in February.

Michael Geist posted on what I would describe as his memo to Senators on the 101 reasons why he hates Bill C-18 and how it’s a Canadian ‘shakedown’ of Big Tech. That moved me to post about a couple of those 101 points, the arguments made about ‘trade irritants’ and treaty obligations under CUSMA and the Berne Convention on copyright.

There’s a shakedown in there all right, just not the one Geist is claiming.

***

There’s a good interview of CBC English TV’s Barb Williams in Hollywood Reporter by Etan Vlessing in which she talks about the programming pivot that CBC is making towards content relevant to Indigenous, Black and racialized communities. 

***

News Corp’s Rupert Murdoch is being deposed in preparation for the defamation trial brought against him by Dominion Voting Systems. The lawsuit arises because of Fox News’ inaccurate reporting on DVS —perhaps knowingly or recklessly— arising out of the 2020 US election and the ‘Stop the Steal’ movement.

Murdoch will be holding on for dear life to the US Supreme Court precedent of ‘NYT v. Sullivan’ which swaddles media and reporters in the ‘actual malice defence’ to libel claims. The Sullivan ruling has long been a target of right-wing activists and now they have a lock on the Supreme Court .

Quite a dilemma. Jennifer Rubin of the Washington Post has a column on this.

***

Love and hate relationship with Twitter? The best media policy read of the week was last weekend in the New York Times, Ezra Klein’s thoughts on the platform. Profoundly insightful IMO.

***

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