Canadian Heritage Committee on June 14th, 2022

[Philippe Méla]

Yes, Madam Chair. I'm sorry. I was reading the amendments to make sure I understand the question.

[The Chair, Liberal, Hedy Fry]

I told everyone that, if NDP-3 is adopted, BQ-6 cannot be moved due to a line conflict. Mr. Champoux is asking why.

[Philippe Méla]

Yes, that is exactly why.

NDP-3 changes lines 18 to 34, and BQ-6 changes lines 28 to 34. The amendments therefore affect the same lines.

[Martin Champoux, Bloc, Drummond, QC]

Mr. Méla, BQ-6 consists of deleting from Bill C-11 the lines that in fact correspond to proposed paragraph (f.1). BQ-5 relates to proposed paragraph 3(1)(f), while BQ-6 relates to proposed paragraph 3(1)(f.1).

There may be some confusion in the lines, but in the end we are talking about two separate portions of a proposed amendment.

[The Chair, Liberal, Hedy Fry]

Mr. Méla, would you like to respond?

[Philippe Méla]

The fact is that NDP-3 replaces proposed paragraphs (f) and (f.1). It replaces both.

[The Chair, Liberal, Hedy Fry]

Thank you.

[Martin Champoux, Bloc, Drummond, QC]

So, by adopting NDP-3, we delete proposed paragraph 3(1)(f.1). Is that correct?

[Philippe Méla]

Yes.

[Martin Champoux, Bloc, Drummond, QC]

Thank you, that answers my question. It is clearer now.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Mr. Champoux.

Mr. Coteau.

[Michael Coteau, Liberal, Don Valley East, ON]

Thank you, Madam Chair.

I have a quick question, through you, for Mr. Ripley.

Would something like this even be possible? Is it feasible?

[Thomas Owen Ripley]

The government's position on this has been that one reason for Bill C-11 is to bring non-Canadian broadcasting services into the system.

Generally speaking, these broadcasting services have global business models whereby they are making productions for global audiences and not exclusively for the Canadian audience.

The issue that this committee and the committee in the previous Parliament have grappled with is how to square the current standard in the current act, which talks about making maximum use, but only applies to Canadian companies whose operations take place in the Canadian context—it makes sense to ask them to make maximum use, no less case predominant use, because the reference point is exclusively Canadian—with the fact that moving forward we will now have non-Canadian services that are expected to contribute to the policy objectives of the act.

The reference point of maximum use in the context where the operations of those businesses are global, from the government's perspective, has been challenging. The government has heard from those companies that they do not think it is a realistic benchmark.

The language that's currently in Bill C-11 is reflective of the work that the committee did in the previous Parliament to set out a “maximum use” standard with respect to Canadian services. With respect to foreign services, it pushes them to make, as the language in the bill says, “the greatest practicable use of Canadian creative and other human resources”. It also clarifies that they should “contribute in an equitable manner”, i.e., in a fair manner. The CRTC has to look at their contributions compared to the contributions of Canadian broadcasters to make sure that the system is fair and everybody is pulling their weight.

The proposal being put forward would create one standard applicable to all and would be that higher maximum use standard. I would also highlight that the language in the current law, i.e., the current Broadcasting Act, has a bit of flexibility in the current standard. It talks about how, “unless the nature of the service provided by the undertaking, such as specialized content or format or the use of languages other than French and English, renders that use impracticable, in which case the undertaking shall make the greatest practicable use of those resources”.

I would just note that the standard being proposed no longer even has that degree of flexibility incorporated, so it is quite a high standard that the committee would be proposing for all broadcasting services.

[The Chair, Liberal, Hedy Fry]

Thank you.

Martin.

[Martin Champoux, Bloc, Drummond, QC]

From what I understand from the explanations Mr. Ripley has just given us, we are going to listen to the multinationals' complaints rather than to the Canadian industry and producers.

Here, undertakings are being asked to use “Canadian ... resources ... in the creation, production and presentation of their [Canadian] programming,” and not for all of their programming. I obviously don't expect an undertaking to be required to produce a Swedish miniseries in Canada.

In this case, I understand that we are listening to these undertakings' grievances rather than pursuing the objective of Bill C-11, which is to make the market fair, both for Canadian undertakings and for foreign undertakings that benefit from the Canadian market.

I find it hard to justify bending to the arguments of these multinationals, when we want them to invest in production by calling on Canadian talent and creators, who are as capable as foreign talent, if not more so, of producing Canadian programming that tells our stories.

I don't think that's a good argument. Mr. Julian's proposal, which is similar to the Bloc Québécois' proposal, reflects the expectations of the industry, the market, our producers, our talent and our artisans. I therefore think that this amendment is appropriate.

[The Chair, Liberal, Hedy Fry]

Mr. Waugh.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

Thank you, Madam Chair.

I have some questions for the officials on the trade agreements. When this was actually signed in the eighties, the deputy minister of Canadian heritage, and I forget the person's name, I apologize.... I've read the book. A big component of the agreement back then was where Hollywood and others did not agree with Canadian laws on Canada-U.S. trade agreements. I'm not sure this wouldn't follow the same trait, that we're not going down the same road. It was the deputy minister of Canadian heritage at the time who actually saved the bill, the broadcasting bill.

It went to the U.S. Congress and they intercepted it, and then we worked our way through it.

Here Mr. Julian has brought an amendment to this, but I am very concerned that we're going back to this with the USMCA some 31 years later. You probably read the book, and I wish I had the name of the book, but it was specifically on this issue of Canada-U.S. trade relations dealing with heritage and broadcasting.

Does it change anything, 31 years later?

[Thomas Owen Ripley]

I'm not entirely sure on the book. Obviously, I would say our trade obligations were certainly kept in mind, as we have crafted this legislation and made efforts to ensure, actually, that it's crafted in such a way as to be non-discriminatory. For example, Canadian online undertakings like Crave, for example, or Club illico would be expected to contribute, just like non-Canadian undertakings. We have certainly kept those considerations in mind.

In response to the committee's debate, the government is seeking to put in place a bill that has a high degree of ambition with respect to seeking contributions from these streaming services, but at the same time we have been mindful about the need to put in place a bill that, at the end of the day, can be operationalized as well. It has to work in practice. I would come back to the reference point with respect to a Canadian broadcaster that is established in Canada, has operations here, and inherently uses only Canadian resources with respect to its operations. It's a different reference point from a global company.

I certainly hear Mr. Champoux's concerns about making sure that we are being very ambitious with respect to the contributions we're seeing from those companies, but we do need to keep in mind that they are a very diverse group of services, potentially, ranging from Netflix to Disney+ to Amazon. The business models are different.

The goal was to ensure that the CRTC has the clear direction to seek from them, to the greatest extent possible, the kinds of contributions they can make to the system.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

That's it, Madam Chair.

[The Chair, Liberal, Hedy Fry]

Thank you, Mr. Ripley.

Clerk, if no other hands are up, then perhaps we will call the question.

(Amendment negatived: nays 9; yeas 2 [See Minutes of Proceedings])

NDP-3 is not carried. This means, then, that BQ-3 is also not carried.

[Martin Champoux, Bloc, Drummond, QC]

No, it's BQ-5.

[The Chair, Liberal, Hedy Fry]

Yes, it's BQ-5—cinq.

NDP-3 is not adopted, so we can move to BQ-6.

We have Mr. Champoux.

[Martin Champoux, Bloc, Drummond, QC]

I'm glad we can still vote on amendment BQ-6, the purpose of which is to remove paragraph 3(1)(f.1) that Bill C-11 seeks to add to the act. I believe that foreign undertakings should not be given preferential treatment over Canadian undertakings. However, that is precisely what this paragraph gives them: they are encouraged to use Canadian resources, but they are not required to do so. In my opinion, this is a way of maintaining inequity in a market that needs to be rebalanced.

I therefore ask the committee to accept this amendment, which consists of deleting paragraph 3(1)(f.1) that Bill C-11 seeks to add to the act.

[The Clerk, Ms. Aimée Belmore]

Dr. Fry, Mr. Housefather has his hand up.

[The Chair, Liberal, Hedy Fry]

Go ahead, Mr. Housefather.