Procedure and House Affairs Committee on Oct. 16th, 2018

[Stephanie Kusie]

You can't adjust the algorithm anytime you want.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

The paying I've seen is that a number of clicks-through and whatnot is the charge, but if somebody, for political reasons, said, “I'm going to charge this party half the cost for a click-through of this party”, I don't know why that couldn't be done. There's nothing—

[Stephanie Kusie]

Then why write the algorithm?

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Well, that's another topic.

If we're ill-equipped for this, imagine how ill-equipped we are for talking about algorithms here. We've made it illegal for The Globe and Mail to charge preferential pricing. I think there's a natural extension to say that we should make that similarly true for Twitter—not the formula they use to charge; it's just so their formula during election and pre-writ is consistent.

[The Chair, Liberal, Larry Bagnell]

Mr. Nater.

[John Nater, Conservative, Perth—Wellington, ON]

Chair, just to clarify for the committee, this is the testimony we heard from Professor Pal on this subject:

Second-last, on social media platforms, there is a new offence in the bill in terms of how social media platforms or advertising platforms generally should not be able to sell space to foreign entities. I think that's a very positive move. I would just draw the committee's attention to the current rules in the Elections Act that are imposed on TV broadcasters. They cannot charge more than the lowest basically available rate to any political party seeking to advertise. What this effectively means is that it gives political parties a right to have advertising time at a reasonable rate, but it also means that the same rate has to be charged to all political parties.

Political advertising is now happening to a great extent on Facebook. There is nothing in the current Elections Act or in Bill C-76 that would prevent Facebook, through what they call their “ad auction system”, from charging differential rates to different political parties. The current rule for broadcasters is in the Elections Act for a reason. There's no principled reason why that shouldn't also apply to social media advertisers, which may have commercial interests at heart when they're making decisions about their algorithms.

That was a recommendation he made and I think it—

[The Chair, Liberal, Larry Bagnell]

Who made that recommendation?

[John Nater, Conservative, Perth—Wellington, ON]

That was Professor Michael Pal from Ottawa U.

[The Chair, Liberal, Larry Bagnell]

Mr. Graham.

[David Graham, Liberal, Laurentides—Labelle, QC]

You can ask Mr. Morin for his comment. He has his hand up anyway.

[The Chair, Liberal, Larry Bagnell]

Mr. Morin.

[LCdr Jean-François Morin]

Thank you, Mr. Chair. I just have a few comments.

First of all, I recognize that section 348 of the act currently provides what it does for broadcasting and published advertisement, and you are right in saying that this doesn't apply to social media. As I was explaining earlier, this is very media specific and therefore, it doesn't apply to the media that aren't included in that.

My second comment is that I'm clearly not an expert in how social platforms charge their clients for their various ads, but one thing I would like to counter is the argument that there is nothing in the Canada Elections Act that regulates how parties are charged for their media placements on online platforms. My colleague Trevor will be able to correct me if I'm wrong, because I haven't worked in this specific area for a long time, but if a specific online platform were to sell its advertisement space for a price below the commercial value of that advertisement space, that would constitute a non-monetary contribution to the political entity, which would already be illegal in the act.

In many of these cases, my understanding is that the price of media placements on online platforms varies according to a kind of auction mechanism. My understanding is also that this auction mechanism is fine, to the extent that, for example, the CPC or the Liberals are not specifically advantaged or specifically disadvantaged by the algorithm. To the extent that the same algorithm is applied to all political entities that take part in this auction, and the fact that they are a specific political entity does not have the affect of reducing the price, then I don't see specific problems in terms of political financing rules.

[The Chair, Liberal, Larry Bagnell]

Before we go back to Mr. Graham, you said if the price was lower, but if Facebook didn't like the Liberals and it charged them twice as much as everyone else, that would not be caught in the act as it now stands.

[Trevor Knight]

Yes, that's just what I was going to add. Depending always on the circumstances, there may be a contribution, and there could potentially be a contribution to multiple parties. But I think it is a different situation where it's an over-contribution and you're giving a lower price to one party. If you don't like another party and you're overcharging them, that's sort of the cost of doing business with that other party. There would be no illegal contribution there.

[The Chair, Liberal, Larry Bagnell]

Mr. Graham.

[David Graham, Liberal, Laurentides—Labelle, QC]

Wouldn't charging the other more make it an illegal contribution to the other ones he charged the regular price?

[Trevor Knight]

The way the definition of “commercial value” is in the act, it's the lowest price charged by that provider in similar circumstances, essentially. If the provider charges parties A, B and C a low price, and then charges party D a higher price, they haven't really made a contribution to A, B and C; they've just overcharged party D. So there's no illegal contribution.

[David Graham, Liberal, Laurentides—Labelle, QC]

I see. As you see this amendment, is it enforceable?

[Trevor Knight]

I can't really speak to the enforcement side of the act. The commissioner of Canada elections would do the enforcement.

[The Chair, Liberal, Larry Bagnell]

Mr. Nater.

[John Nater, Conservative, Perth—Wellington, ON]

In terms of the enforcement, there would have to be invoices from the company. Whether it's Facebook, Twitter or some other social media platform, there have to be invoices provided to those who have purchased the advertising, so there is a way to determine that.

[The Chair, Liberal, Larry Bagnell]

Is there any further discussion?

Mr. Nater.

[John Nater, Conservative, Perth—Wellington, ON]

My esteemed colleague Mr. Church did point out that the Liberals are providing additional resources to the commissioner of elections to go out and get that information, so he would be well established to have those resources to do so.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Would they include a [Inaudible—Editor] surcharge? Is that an option?

[Voices]

Oh, oh!