Canadian Heritage Committee on Oct. 30th, 2006

[Chris Warkentin, Conservative, Peace River, AB]

I do appreciate that you have a difficult job in trying to make those decisions and those determinations.

Maybe I'll just make my own little submission here. Specifically in rural communities, there may not be the population to sustain the current radio stations. They may not believe there's room in the market for additional players. Maybe I'll just make the submission that people are looking elsewhere, and therefore we're probably losing control that we would not want to lose, and that may be a consideration in the future.

On the issue of the Internet, the regulation of Internet uses has been discussed several times. Is any country regulating that you're aware of, and is it doing it effectively? Is there any other jurisdiction that we're looking to for a model that we might engage in if at some point we decide, or you as a committee decide, that it's a good--

[Charles Dalfen]

I can say this without immodesty, because the new media order was adopted before I got to the commission: other countries look to us for that. It was a very well-crafted document. As I say, it occurred before my watch, so I can talk about it quite comfortably in that regard.

The issues that come up on the Internet are pornography, child pornography, and hate speech. Those are the issues that come up on the Internet, those and the questions of whether it should be regulated outside normal criminal law--and if so, by whom--and whether the human rights tribunals should play a role.

Courts have some role to play. Should the CRTC have a role? If the problem increases in intensity, and this country and Parliament believe that it's not being taken care of under the general criminal law, which is where it's now dealt with, and under human rights legislation to a lesser extent, then those questions will have to be asked.

For the moment, those appear to be the issues that we get most pressed on, rather than the regulation of, say, the broadcasting aspects of it.

[Chris Warkentin, Conservative, Peace River, AB]

Okay. I'm probably running out of time, but am I to understand, then, that there's really no talk of monitoring Canadian content within Internet--

[Charles Dalfen]

We are monitoring that, not in the way that we monitor the obligations of broadcasters to budget for and keep logs and so on, but we are monitoring it, both actively and in following all the literature that comes out and receiving information from people. Indeed, this new branch that we call the middle pod in the organization, the technological and economic and financial analysis branch that's going to serve both broadcasting and telecommunications, will hopefully gather and continue to gather that expertise and that monitoring effort.

[Chris Warkentin, Conservative, Peace River, AB]

Thank you very much.

[The Chair, Conservative, Gary Schellenberger]

Mr. Angus is next.

[Charlie Angus, NDP, Timmins—James Bay, ON]

In our numerous meetings on film and television, what comes up again and again is the 1999 CRTC decision that changed the definition of Canadian content. The message we hear--and we've heard it from numerous people across the country--is that it had a devastating impact on the production of domestic drama in English Canada. In the new television review that's under way, are you looking at the needs of drama in the English television market and whether the CRTC should be playing some kind of role in ensuring a restoration?

[Charles Dalfen]

Thank you.

It's similar to the answer I provided to Mr. Malo. The commission adopted an incentives policy for drama. The answer is yes, we believe we should be involved in that, and the level of Canadian drama should be higher, in our view, across the system, and we should take whatever measures are useful to do that.

The measure we have taken so far is to adopt an incentive policy whereby broadcasters who spend certain levels of dollars, carry certain levels of hours, and achieve certain viewership--because ultimately it's about what the viewer sees--will be rewarded by more advertising minutes, which they can then use for their most popular foreign programming, programming that already has time for more advertising than the 12 minutes we allow in Canada--and this is taking root. We haven't had dramatic results--no pun is meant--but we have somewhat encouraging results and we'll see that along.

The next opportunity to look at that will come up in some ways in the TV policy review, but where it'll ultimately come up is in the renewals of the major broadcasters a year or so later, in their commitment to Canadian drama and so forth. People, including the people I'm sure you hear from, will have an opportunity to weigh in at that point.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

I want to go back to the discussion we had about taking direction and whether the CRTC takes direction from the minister, whether they take from Parliament, whether they take it in a private room with the PMO with the windows closed, or whether it's 155-plus-one MPs.

I'm looking at the Telecommunications Act and I don't see where that's clearly laid out, but what I do see is the obligation to “promote the ownership and control”--not maintain, not put up with, but promote. Our minister has given a directive, and that directive is to let the market forces rule. Letting the market forces rule is not necessarily the same thing as promoting Canadian ownership, so I'm asking you how you see your role to promote control and ownership in terms of the Telecommunications Act.

[Charles Dalfen]

Just to step back for one second on the premises, we are bound by law--I think it's section 47 of the Telecommunications Act--to give effect to policy directives of the government on matters of broad policy concern. That's very clear. We have not yet received such a directive, period. It's working its way through. It's been tabled in Parliament, and I gather there's a committee decision to have a report by March 1, 2007.

Even that directive, which is not yet enforced, doesn't contain material on foreign ownership, so the issue of foreign ownership is in effect on whatever track it's on. If it is on a track, it's on a separate track from that, but if that direction on foreign ownership were eventually to come to pass, then under the act we would be bound to give effect to it, and although the section 7 provisions you're reading talk about our promotion of Canadian ownership, we would, as an affirmative legal matter, be bound by such a directive.

It's all hypothetical because, as I said, there is no such directive in force on foreign ownership, but that would be the legal answer I would have to give you. We would have to say that the government has given us a directive and that we are legally bound to give effect to it, and that you have to read the promotion of foreign ownership into that.

[Charlie Angus, NDP, Timmins—James Bay, ON]

So a directive from the government would supersede the laws laid out in the Telecommunications Act?

[Charles Dalfen]

It would have a legal impact. I hate to give you a legal opinion here. I'm checking back with my own legal adviser.

I think the correct answer is that it says it would be binding. These objectives are ones that were meant to regulate and give effect to, and we do.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Okay, if it's contrary to the Telecommunications Act and it's from the government, then that's what you're bound by. That's all I need to know.

[Charles Dalfen]

Others would have to say that. My legal adviser points out that in the act itself, section 16 says, “A Canadian carrier is eligible to operate as a telecommunications common carrier if it is a Canadian-owned and controlled corporation incorporated or continued under the laws of Canada or a province.” What the government has the right to do is define what “Canadian” means under this provision. Under the Telecommunications Act, as distinct from the Broadcasting Act, the provision is in here; it is they who determine what is Canadian, and they have the right to do that.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Okay. They're not going to declare AT&T a Canadian citizen. The question is if it comes before and AT&T wants to buy up Bell Globemedia and all their telecommunications and operate it from Wascana or wherever--Washington....

My question is this. What you're telling me is that you take your directive from the government, a directive that's a change in policy, and not from the act itself, which says you are obliged to promote the ownership and control of Canadian carriers by Canadians.

[Charles Dalfen]

The act says that those are the objectives of policy, but it also says very clearly that in the event of a directive, the directive is binding on you. It's in the act, and I guess you have to sort it out in that light. You can't, as a matter of the commission, say that directive is illegal. You have to say that--

[Charlie Angus, NDP, Timmins—James Bay, ON]

You can't say that it's contrary to the Telecommunications Act.

[Charles Dalfen]

It would not be for us to say it. I suppose in extreme circumstances we might have a view on that, but frankly, it would be up to the courts to make that determination.

[The Chair, Conservative, Gary Schellenberger]

Thank you very much.

Mr. Bélanger is next.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Thank you, Mr. Chairman.

This is a very interesting discussion. I have to say that I always find it amusing when a member of Parliament accuses another member of Parliament of being a politician. Thank you for that laugh, Jim.

This might surprise some of our colleagues here, but my reading of the act is that indeed the executive, through its authority to give directives, can pretty well tell the CRTC what to do.

I've even found out that there are two authorities to set regulation--

specifically, under the Canadian Radio-Television and Telecommunications Commission Act, the Broadcasting Act or the Telecommunications Act. And, in fact, both the CRTC and the Governor in Council can make regulations.

I have been asking myself these questions, and I would like to put them to you, Mr. Dalfen. But, I would like to begin with a question that is not at all theoretical.

Has the CRTC passed regulations that conflicted with regulations made by the Governor in Council?

[Charles Dalfen]

No, not to my knowledge.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

I see.

My second question is theoretical.

If that were to occur, how would the problem be resolved?

[Charles Dalfen]

Well, ultimately, it would probably come before the courts, although I do believe it is an extremely rare occurrence.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Well, having checked, I have a partial answer. It can be done in two or three different ways, and I think that Committee members should be aware of this. This information can be requested, and based on what has happened previously, specific regulations take precedence over general ones. So, if certain regulations are more specific than others, the more specific ones may prevail. In other cases, the most recent regulations may take precedence over the older ones.

Finally, if it is impossible to agree, the matter goes before the courts. And that is where it gets interesting. What counts most, when such a matter comes before the courts, is the legislator's intent. So, if there is a conflict between the legislation and the regulation, the court will consider the legislator's intention. That is where it gets interesting. And that is the reason why I asked you about this earlier.

I am not asking the CRTC, in responding to the government's proposed directive, to take the position expressed by a majority of parliamentarians. That is not what I'm asking of the CRTC. I simply want to know whether it intends to react, because this does raise a concern. Whether or not one agrees with the idea of removing or maintaining restrictions as regards foreign ownership of Canadian corporations, that concern remains.

It is clear that a majority of members of Parliament have stated that they want those restrictions to remain in place. There are broadcasting firms that are very concerned. There are also telecommunications firms that are aware of that concern. Personally, I believe it should also be a concern for the CRTC.

I am not asking it to tell me how it will respond; I simply want to know what the CRTC can do, first of all, and, second of all, whether it will actually do that. It can say whatever it likes. It is not up to me to tell the CRTC how to respond, but as a legislator, I have every right to know whether the CRTC has a right to respond, which you have already confirmed, and what I want to know now is whether you can.

I'm satisfied with your answers. I was certainly not trying to force the CRTC to take any particular position. Is that clear?

[Charles Dalfen]

Yes, it is. Thank you.

I understand what you are saying; you have made your position quite clear. I have nothing to add.