Debates of June 4th, 1996

Tobacco Products Control Act

[Ian McClelland, Reform, Edmonton Southwest, AB]

Mr. Speaker, I have listened to about an hour's worth of absolute balderdash, which is the nicest word I can use, coming from the opposite benches defending the indefensible. It is absolutely shameless. What can we do to shame these people? How do we go about doing it? I think it is impossible. What could be beyond it?

After this Parliament commenced in the fall of 1993 we had,as members will recall, great lawlessness in the smuggling of tobacco. What does the government do? Does it say "wait a

minute, you cannot be breaking the law here, folks, and you will obey the law from coast to coast"? Because the government could not enforce it, it gave in to it. It reduced the price 50 per cent or more for a package of cigarettes. That broke the back of smuggling but I will tell you what it also did. Does any member opposite have any idea of the notion of price elasticity? The lower the price, the higher the demand. The higher price, the lower the demand. It is a law of marketing. It is there. It is a fact. It is irrefutable.

What did the government opposite do? It lowered the price. What happened? Demand went up. Then what did it do? It said on its holiest of holy grails: "We are going to change the packaging". Did that happen? No.

Then the government said it was going to gradually increase the price over the next couple of years. Did that happen? No. Prices stayed where they were. The federal government, through the Supreme Court, not only has the right, it has the responsibility to legislate advertising standards around the tobacco issue.

Do members remember when tobacco companies, through a Supreme Court ruling, were allowed to advertise? The Supreme Court said it was up to the federal government to write legislation that would prevent it. It is not up to the Supreme Court to interpret legislation in a manner that prevents it.

Where in this legislation about preventing tobacco advertising in a manner that will affect the most vulnerable which are, of course, children? Please show me where word one is in restricting tobacco advertising that could be used to influence children.

I recognize that the member opposite, the Secretary of State (Multiculturalism)(Status of Women) for Vancouver Centre, herself a medical doctor, understands and appreciates the necessity of reducing smoking. I am not suggesting for a moment that members opposite do not understand or appreciate it. I am saying that if they are going to be apologists for the tobacco industry, at least do it honestly and say there is nothing they can do about it.

It is the hypocrisy of this that just drives me crazy. To listen to the members opposite talking about how bad cigarette advertising and tobacco are for the health of Canadians and do absolutely nothing about it is just beyond the pale.

[Hedy Fry, Liberal, Vancouver Centre, BC]

Mr. Speaker, this is an interesting statement made by the hon. member. I do not know if he has been present for the last two and a half years around this place or not.

If the hon. member would recall when the tax on tobacco was lowered, not by 50 per cent I might add, some other comprehensive things were done to mitigate that. There was a health tax. It was the first time any country in the world put on a health tax on tobacco.

[Ian McClelland, Reform, Edmonton Southwest, AB]

How much are cigarettes outside of here?

[Hedy Fry, Liberal, Vancouver Centre, BC]

Let me answer your question. If the hon. member would allow me to answer he might learn something.

The government increased the tobacco health tax that went straight into health funding. That has been something for which anti-smoking advocates have asked for a long long time. We were the first people to do it.

Legislation was also brought in that dealt with banning kiddy packs. Other legislation in effect banned the use of tobacco in vending machines so that tobacco was brought almost alongside alcohol in terms of where it could be bought. It cannot be sold anywhere unless the person is not a minor. So it would only be in bars where you cannot go until you are over 19.

The age limit was increased for people bringing tobacco into the country. All of that was brought in when we brought in this legislation. It is a comprehensive set of strategies. It is interesting that we would only talk about this issue.

Banning the advertising of cigarettes is something that Canada took the lead in. These are things that have been questioned by the tobacco industry. One of the things that we now know is that when we talked about sponsorship in terms of advertising we said that tobacco companies could not promote and sponsor tobacco because of course of the Supreme Court rulings. They could do it only as a corporate entity. The tobacco companies changed their corporate logo to their tobacco logo and got around that legislation.

This is something that we have been moving forward on for years as a country. Every time we move forward, something comes up to block us in terms of legislation and the Supreme Court.

We continue to keep struggling to move forward on this issue because of legalities. The will is there. The political will has been shown. There are legalities that we constantly have to move around. There is research that we are doing to help us to do this.

[Keith Martin, Reform, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, this debate would be funny if it was not so tragic. I cannot believe the comments that have been made by members across the way which, to my mind, are absolute, sheer hypocrisy.

They are irreconcilable. On one hand, they say that they believe that smoking is bad for people, that it is going to kill people and that they are committed to preventing, as the Minister of Health of the day said, even one youth from smoking. On the other hand they

bring in legislation that is the most important factor in promoting smoking among youth. They are irreconcilable.

I understand what was going on at the time of the tobacco rollback. I understand that smuggling was a problem, but that was not the solution. I will get back to that later.

Reform members support Bill C-24 because it does something toward promoting education concerning this lethal product. This is very little compared to the larger picture. When we go to sleep tonight, 123 people will have died in this country. Over the course of the year, some 40,000 Canadians will die of cigarette related illnesses. It is the single most important preventable cause of death and illness in this country today.

The legislation put forward by the government over the last two years has done nothing but increase that. The small measures that it has taken really beats around the bushes, around the outside.

The profound effects that it has had have committed some 40,000 to 60,000 youth to date to smoking. Half of them will die at least 10 to 15 years earlier than what they should have died. If there is one shameful legacy that the government has, this has to be it. I am embarrassed to say that I was part of the Parliament while this took place.

We welcome again Bill C-24, particularly in view of the overturning by the Supreme Court of the ban on tobacco advertising, an unbelievably myopic and absurd decision by the highest court in the country. It is unbelievable to me how justices could consciously do that, understanding full well the impact on the health of Canadians and as my colleague mentioned, particularly on the health of youth.

The other action, the tobacco tax rollback I mentioned, was done because of the smuggling that was taking place. There is no doubt that we had to do something to address that problem.

Reform members presented to the government an alternative solution that would not have entailed a decrease in cost. Members know that cost is the single most important determining factor in cigarette smoking, particularly among youth. Our proposal was to put an export tax on cigarettes. Why do we know this works? It is because in 1992 the Conservative government of the day had a similar problem with smuggling and it put on an export tax of $8 a carton.

Within six weeks, the amount of smuggling went down dramatically, in the order of 60 per cent. What did the Conservative government of the day do? It removed the export tax. Why did it do that? The tobacco companies threatened to leave the country. The tax was working but the government failed. That is why there was a rollback in the taxes. That is why today cartons of cigarettes cost 50 per cent less than they did when we were elected two years ago. At that time cartons of cigarettes in Ontario cost $50, today they cost $25. What do people do? They smoke more. We do not need a tobacco reduction strategy to tell us that. We just need to walk into a store to see that or speak to the youth on the street.

Our alternative was to remove the tobacco tax rollback, bring the cost of cigarettes back to where they were, put the $8 export tax on cartons and enforce the law. At the time the smuggling was taking place, the police officers in the area were told to turn a blind eye. The government did not want to confront the smugglers, particularly because a lot of the smuggling was taking place on aboriginal land in the Kahnawake and Kanesatake reserves. It did not want to start up another Oka.

We have one law in this country and that law must be applied equally to all of the people who live inside Canada. It was not done deliberately.

The government should bring the export tax back, bring the costs back to where they were for tobacco, and enforce the law. We would not have a smuggling problem and the increase in consumption that we have today. In fact we would see a decrease in consumption.

The cost of the tobacco rollback has not been minor. The costs will be an increase in deaths, in morbidity and a decrease in gross domestic product, because people fall sick after smoking. These are hidden costs that the government is not taking into consideration and it is not informing the Canadian public.

The costs in my province of British Columbia are in the order of hundreds of millions of dollars in losses in gross domestic product. The cost in health care across the country is estimated to be in the tens of billions of dollars.

That is what the government has done to save face with the tobacco companies. That is really what all this is about. It is trying to do something without disturbing the tobacco companies, the purveyors of these products of death, mayhem, sadness, sickness and untold human suffering.

I challenge the members across the way who voted for that. I know many of them know people in their own families who have died of smoking related illnesses. I ask them to put themselves again in that mindset and think what would happen if their children too were going to suffer from those same terrible diseases.

The increasing consumption, particularly among the young, has been enormous. Just in the last couple of years it has gone from 21 per cent up to 30 per cent. It is going to continue to rise.

I put forward a private member's motion shortly after the tobacco tax rollback took place. The motion dealt with the rollback. Did the Standing Committee on Procedure and House Affairs make this a votable motion? No, it did not. It did not want the

overnment to be embarrassed over this issue. Sadly, my private member's motion asking for the tobacco tax to be put back on died on the Order Paper. I challenge the government once again to bring back those taxes.

Second, members across the way have proudly talked about the tobacco demand reduction strategy. What did this government do? It cut the funding for it. I would like to know from government members what has happened to the tobacco demand reduction strategy.

When people are trying to educate youth about tobacco, do they not tell them that they were going to die of lung cancer or that they were going to suffer from emphysema or chronic constructive lung disease? We have to argue on the basis of narcissism, believe it not, and tell them that their breath is going to smell foul, that it is lousy for their dating and their personal lives, that their skin is going to become sallow and that physically they are not going to look as good as they did before. Then we will have an effect on them. To tell them about all the terrible diseases they will get simply will not work because they have a sense, as we know, of immortality at that age.

As I mentioned, the supreme court decision shot down the ban on advertising on tobacco. That happened eight months ago. The government has had eight months to do something about it but has done absolutely nothing, although it promised it would. If that is how long it takes, the minister and the ministry of health should be ashamed of themselves.

It is absurd when we think about what this ban means. It means we can advertise for Rothmans, we can advertise for Craven As, we can advertise for Camels, but we are forbidden to advertise for the Nicoderm patches used to prevent people from smoking. That is the absurd situation we have today.

I have some solutions. Put tobacco in the Food and Drugs Act. This would give the government regulatory authority over tobacco. It would enable it to put standards on product quality, composition, packaging, sale and advertising. It would empower it to do what it has failed to do over the last three years. It is particularly important because a few years ago tobacco companies were found to be spiking cigarettes with nicotine in order to increase their addictive potential. This would prevent that in Canada. It would not require a legislative change either.

Put back the export tax. Enforce the laws against smuggling. Bring back the legislative ban on cigarette advertising. Increase education for children.

We need to get back to basics. We have a health care crisis in Canada today, the increase in consumption of cigarettes particularly among youth. The Liberal government and the previous Conservative government caved in to pressure from the cigarette companies.

Solutions exist to balance out the needs of the government to stop smuggling, which has to be done, while enabling us to preserve the health and welfare of Canadians and prevent the sickness, the tragedy, the mortality and the morbidity that will affect Canadians.

I ask every member in the House who has children to look at their children carefully when they go home tonight and ask themselves if they want to compromise their children's lives. Do they want to compromise their children and their friends' lives by allowing the embarrassing situation we have today with the tobacco tax rollback?

If the government is truly committed to preventing cigarette consumption, the single most important thing it can do is increase the cost of cigarettes to Canadians. By doing this it will decrease consumption and improve the health and welfare of all Canadians. It will be the single most important legacy for the health and welfare of Canadians.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, the member, the Secretary of State for Multiculturalism, the parliamentary secretary and other speakers have clearly laid out the public health issue related to tobacco. I do not think there is much disagreement as to the priority and importance of dealing with it.

We also know there are some things going on among parliamentarians and the courts, the supreme court. There have been studies with regard to changing labelling and plain packaging, supreme court decisions on the advertising permissibility and actions by lobbyists. This is an area of particular interest to me as a result of the experience I had with labelling containers of alcoholic beverages.

The member has raised some good points in terms of additional strategy. However, Bill C-24 gives the distributor of the tobacco product the option of attributing the health messages on the product to an entity specified in the regulations, in part.

I simply ask the member, notwithstanding this in itself is not a comprehensive strategy, whether he would agree that attributing the health warning message on the packages of cigarettes to a body such as Health Canada or the Parliament of Canada or the Government of Canada would not enhance the credibility of the message, simply by sourcing it to some reference body. That it is a positive step, although I am sure not the conclusive solution the member would like to see.

Would he not agree that is probably still a positive step which should be supported?

[Keith Martin, Reform, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, the question is do we want to look good or do we want to do good?

Bill C-24 is a welcome addition. However, do we beat around the bush on this issue or do we cut to the chase and get to what really counts? When we are weighing legislative initiatives, there is no proof plain packaging works. Do we deal with legislative initiatives which will have little or no effect or should we be dealing with something which will have a profound effect?

The number one, most important factor in tobacco consumption, which is what we are addressing, is cost. The cost factor is most important for youth, less important for adults, but nonetheless important in both areas.

The elasticity of price and demand is so important that it overshadows virtually every other initiative the government can take.

To answer the hon. member, we certainly support Bill C-24 but for heaven's sake, deal with the big issues. Bring back the tobacco taxes to what they were before and raise the cost of cigarettes to where it was two years ago and then we will truly have a profound effect on consumption in Canada, which is what all members what to see.

[Joe Volpe, Liberal, Parliamentary Secretary to Minister of Health]

Mr. Speaker, like others in the room, I compliment all members who have as the base of their interventions the altruistic and sincere desire to ensure the health of all Canadians is safeguarded.

The member does a great discredit to the initiatives the government has taken over the last couple of years, specifically the question of the tobacco tax he referred to on a couple of occasions. That was not an isolated initiative. He pointed out this is a complex problem that requires a comprehensive approach. Much of what he addressed is already in place and not working.

Export controls and taxes were causing problems in many places in Canada and had to be addressed as well. He is conveniently putting to one side the fact that other initiatives were put forward by the government to specifically address consumption of tobacco products by young people. It is very easy to put them to one side and pretend they do not exist. The government initiatives are in place and they are working.

Finally, it is important as well to appreciate that in the context of some of those initiatives it was a supreme court decision that did away with some of the initiatives which were already in place.

If the member opposite is impatient because the appropriate legislation has yet to be presented before the House, it is only because the government wants to make sure the legislation, when it is presented, will withstand the challenges that will surely come forward from interested parties.

If he is as sincere as he has demonstrated in the House, he would encourage the Minister of Health and all his colleagues in cabinet to ensure the safeguards are in place and that all the checks and balances are looked at carefully so that we not repeat the scenario which we saw in the supreme court some eight months ago.

The member is correct to bring these issues forward in the House, but let him make an acknowledgement that Bill C-24 is a very important and good first step. He can bring his suggestions forward when the legislation goes to committee.

[Keith Martin, Reform, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, I brought these ideas forward two years ago.

We support Bill C-24 as a first step. However, I take issue with the hon. member when he said the initiatives of the government have worked.

As we have mentioned before in the House, tobacco consumption among youth has increased dramatically since the tobacco tax rollback. Statistics from the ministry of health showed conclusively six months after the tobacco tax rollback that consumption by youth was increasing alarmingly. That proves the tobacco tax rollback has had a terrible effect on consumption by youth.

I will acknowledge that the hon. member was correct when he said that previous initiatives did work. In the 15 years before May of 1994 tobacco consumption had been progressively decreasing. However, as soon as the tobacco tax rollback took place consumption skyrocketed. They are directly related.

While I say Bill C-24 is a welcome initiative, why is the government pursuing little initiatives which are to have little effect? Why does it not pursue the big issues and the big initiatives which will have a big effect on the health of Canadians? As we stand here and pussy foot around the issue, every single day more youth are taking up smoking and more people are consuming of this lethal product.

Tomorrow if the government wishes, it could bring back those tobacco taxes. It would not find disagreement in the House. Also, it should put tobacco in the Food and Drugs Act. Then the government would have the legislative ability to do the things it ought to be doing.

[The Deputy Speaker]

Is the House ready for the question?

[Some hon. members]

Question.

[The Deputy Speaker]

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[Some hon. members]

On division.

(Motion agreed to, bill read the second time and referred to a committee.)

Copyright Act

[Lucienne Robillard, Liberal, Minister of Citizenship and Immigration and Acting Minister of Canadian Heritage]

moved that Bill C-32, an act to amend the Copyright Act be read the second time and sent to committee.

Mr. Speaker, the reform of the Copyright Act, which has been on the agenda for more than ten years, has now become a necessity. It is crucial that our legislation conforms to reality so that we can prepare the way to the future.

The amendments that the government is proposing today will put our cultural industries on the same wavelength as the other industrialized countries of the West and the G7 countries. They will enable us to better meet the challenges presented by the new distribution technologies.

These amendments are the expression of the government's commitment to the cultural sector. We stated that we had two objectives in promoting the cultural industries: to bolster Canadian identity and to encourage job creation.

Let me begin by reminding you how important the cultural sector is to the affirmation of Canadian identity. Culture is expressed through the voices, words and gestures of talented men and women. Their works are the manifestation of that culture. They forge the image that a country creates of itself and offer it to the entire world. They are at the heart of our national identity. They are the creators who shape our world view.

Our culture is the thousand and one signs through which we see ourselves as individuals belonging to a country. Culture is the vital link that unites us all. Culture also provides work for 670,000 people, including creators and producers, who inject $16 billion into our economy and attract foreign capital.

Canada's cultural sector is one of the fastest-growing segments of our economy. Since 1981, it has grown by 32 per cent, compared with 12 per cent for other sectors. There is no doubt that the arts and culture sector-the ninth largest in Canada-must be strengthened if it is to continue to contribute to economic growth and the vitality of our cultural identity. That is precisely what we intend to do with Bill C-32.

The Government of Canada is proud of this series of fair and carefully developed amendments. The new act establishes a fair balance between the rights of creators to be compensated for their work and the need for users to have access to those works. We have taken everybody's interests into consideration and have made sure that everyone gets their due.

Some elements included in the bill are: the rights of performers and producers of sound recordings; a compensation system for private copying; limited exceptions for schools, libraries, museums, archives and people with visual disabilities; protection for exclusive book distributors in Canada; and measures to improve public management and legal recourse. I will now summarize the main features of each of these amendments.

First, let us look at performers' and producers' rights. At present, you can hear singers on the radio anywhere in the country, and they receive no compensation for their performance. As it is currently worded, the Copyright Act entitles only authors-that is, lyricists and composers-to payment for the public use of their works.

From now on, performers and producers will be able to receive a royalty from those who perform their works in public or broadcast them. Thanks to this measure, performers, who often live in impoverished circumstances, will, at least, be able to count on this income. I will remind you that Canadian performers have the right to be remunerated for their work.

One thing is clear, however: it is not a question of correcting the injustices done to artists and producers by penalizing those who use their sound recordings. Of course, the broadcasting industry, which is the primary user of sound recordings, will pay the levy. But the industry's financial situation will be taken into account.

All radio stations will pay a fixed rate of $100 on the first $1.25 million in advertising revenues. Based on the 1994 data, 65 per cent of private broadcasters will pay only this amount. Moreover, as a result of generous transitional measures, the tariff on advertising revenues over $1.25 million will be phased in over a five-year period. The Copyright Board will set the tariff after hearing from the various stakeholders.

Adopting this bill will allow Canada to adhere to the Rome Convention, an international agreement already ratified by 50 countries, including France, Great Britain and Japan. The result of this will be that Convention member states in which the sound recordings of Canadian performers and producers are performed in public will pay them royalties. These will be added to the royalties they receive for the public performance of their works in this country.

The new measures governing private copying are also intended to give due justice to Canadian creators. We all know that consumers make taped copies of sound recordings for their own use. In Canada alone, according to the Report of the Task Force on

the Future of the Canadian Music Industry, almost 40 million blank tapes were used for this purpose last year.

What people seem to forget is that this deprives composers, singers, producers and performers of the royalties to which they are entitled. In the past thirty years, artists and the sound-recording industry have incurred considerable losses because of private copying.

It is impossible to control private copying and pay the rights holders each time their works are reproduced. That is why a levy will be charged on all blank media, such as tapes and cassettes, in order to compensate rights holders for their losses. The Copyright Board will establish the amount of the levy, which will be paid by the importer or manufacturer.

It is important to point out that the government does not receive the royalty. The Copyright Board will establish the mechanism for dividing the royalty among composers, lyricists, performers and producers of sound recordings, and the professional associations or collectives will distribute it.

I want to reiterate one of the main reservations of Bill C-32. In the wording of the proposed amendments, we were careful to protect the interests of both creators and users. I would like to add that we are fully aware that in the public interest, exceptions limiting the enforcement of copyright are sometimes necessary. It is a question, once again, of finding a balance between users' needs and those of copyright owners.

The Act therefore provides that, in some situations, a work can be used without authorization and without any obligation to pay a royalty. Non-profit educational institutions, libraries, archives and museums will benefit from this type of exception.

There are also special measures that apply to individuals with visual disabilities. This improvement to the Copyright Act is proof of the government's desire to make culture accessible to the greatest possible number of people.

It marks a significant step in the legal recognition of the needs of people with perceptual disabilities and the need to guarantee them access to cultural works on substitute media.

The bill focuses on other major components of the cultural sector. Canadian publishers and book distributors spend a great deal of money and energy negotiating with copyright holders and original publishers for the exclusive right to sell their books in Canada. Some institutional buyers however circumvent the exclusive Canadian distributors by ordering directly from foreign suppliers. It is called parallel importation.

When bookstores, wholesalers, universities and libraries order books from distributors outside Canada and thus circumvent the authorized Canadian distributor, new provisions of the Copyright Act will restrict the importation of books to Canada when an exclusive distributor, regardless of nationality, already occupies part of the Canadian market. In return, the distributors and their clients will negotiate tenders of performance which will be included in the regulations.

The final component of the amendments is vital if we are to modernize an act that was established in the 1920s. In order to more effectively halt ongoing infringements of the Copyright Act, the amendments provide civil and criminal remedies, and modernize the wording of the Act. For example, because the extent of infringement is difficult to prove, copyright owners are often prevented from being fully compensated for their losses. As a result, we are proposing a system of statutory damages that would guarantee a minimum award once infringement is proven and serve to deter future infringements.

There are some who will say that the current amendments do not go far enough because they do not include copyright issues related to the information highway and new technologies. We had several good reasons for excluding these issues from the current phase of copyright reform. First, there is the question of internal administration. Our priority was to settle the unfinished business of the previous administration. After almost ten years of neglect by our predecessors, and at the repeated request of Canada's cultural sector, we had to adapt the legislation to the realities of the marketplace and the major international conventions in effect, while responding to the most urgent concerns of the cultural sector. Once these necessary amendments have been adopted, we will be able to move on to the advent of the information highway and the new distribution technologies.

As you can see, this bill is a step forward. It gives those in the cultural sector their due. Culture is the essence of our national identity, the expression of our pride. It allows each and every one of us to participate in the building of our collective history. The amendments to the Copyright Act were drafted with that in mind. Bill C-32 will strengthen the heart and soul of the Canadian cultural sector, as well as providing a more solid economic basis. I urge my colleagues to support the government in this crucial undertaking.

[Louis Plamondon, Bloc, Richelieu, QC]

Mr. Speaker, I am torn between joy and fear as regards this bill. I am pleased of course as regards neighbouring rights, but extremely concerned about the list of exceptions that is being added.

Let me first put the issue in its proper context. The first phase of this exercise was Bill C-60, which was passed in June 1988 and which is now followed by Bill C-32, to add or remove certain rights to authors.

As we know, copyrights apply to any literary, dramatic, musical or artistic work that is original. This legislation applies to a slew of works, including books, dictionaries, maps, sculptures, paintings and related works such as translations, summaries and adaptations. It applies to both published and unpublished works.

The bill creates two types of rights. Moral rights recognize the author as the owner of the work and, consequently, his or her right to authorize its use in conditions deemed appropriate. There are also economic rights, which can be divided into two major categories: those dealing with reproductions and those dealing with public performances.

As we know, copyrights usually apply for a period of 50 years after the death of an author. The act provides for some exceptions, the most important one being the fair use of a work for private studies or research. I will elaborate on these exceptions later on.

Phase I of the review of the copyright legislation resulted in Bill C-60, passed in June 1988, which extended copyrights to computer programs, extended moral rights of creators over their works, granted the right to exhibit visual arts, abolished compulsory licensing-the so-called K-tel clause, which allowed the reproduction of acoustic works for a payment of 2 cents for the recording-replaced the Copyright Appeal Board by the Copyright Board, and recognized collectives.

A collective is a group of copyright holders, such as SOCAN. However, the first phase, which resulted in Bill C-60 being passed in 1988, did not solve the issue of private copying, or home recording, and did not include the recognition of neighbouring rights.

As well, Bill C-60 did not recognize other creators' rights, such as those claimed by the copyright coalition. Between 1988 and 1994, four series of amendments were made to the act, following the commitments Canada made in the Free Trade Agreement, NAFTA or treaties signed with the World Trade Organization.

The copyright legislation has been in force for about fifty years. It was amended in June 1988 and now this amending legislation, Bill C-32, has five major goals. It sets up neighbouring rights for performers and record producers. We commend this decision. A regime is established in relation to the private copying of sound recordings. It provides for a levy on blank audio cassettes manufacturers. That is also a step in the right direction.

It protects the exclusive markets of Canadian book distributors, what we call the right of distribution. It has some weaknesses but it is still acceptable. It increases the exceptions where no royalties or no neighbouring rights can be claimed. We are shocked to see that the list of exceptions has gone from one page to 12 pages. That is unacceptable and goes against all the progress made in Canada and all the legislation passed throughout the world.

Five, the bill amends the current legislation in order to improve collective administration and civil remedies. In that area, it provides for the usual process.

First of all, I will talk about neighbouring rights. I will remind members that these are rights given to performers and producers of sound recordings. For example, when Renée Claude performed a song, she did not have any rights. Now she will have what are called neighbouring rights, and so will the recording company.

At the present time, when radio stations play the recordings of these performers, the authors and composers receive royalty payments, but not the performers or the producers. So it is a step in the right direction. However, there is a problem on which I will elaborate a little later on.

Members will recall that neighbouring rights are recognized in 50 countries. However, they are not recognized in the United States. Therefore it was important for Canada to adhere to the Rome Convention. It is essentially radio stations that will have to make payments under the neighbouring rights system. However, and this is where the problem is, there is a $1.25 million exception, which means that if a radio station's advertising revenues are less than $1.25 million, it will pay only $100 in royalty payments. Since when can one take somebody else's rights and decide how much that person will receive in compensation? Why not let the free market play its role since we have a tribunal and people who could established the amount that should be paid by users?

Do you use your neighbour's car without his permission and tell him afterwards that you will give him $10? No. You negotiate before using it. It is as simple as that. This amount of $1.25 million seems very high, especially that this system would be in place for a trial period of five years.

I understand that broadcasters wish to be exempted from paying neighbouring rights. In 1993, AM stations lost $59 million, while FM stations made profits of $20 million. They are claiming that the introduction of a neighbouring rights system would shut down radio stations and result in lost jobs.

Like ADISQ, the Bloc Quebecois feels that the raw material is the talent of artists and producers, and that the use of this talent must be recognized. The Copyright Board has the mandate of setting the neighbouring rights tariff, taking into account users' ability to pay. So let us let the Board do its work, instead of setting $1.25 million in advertising revenue as the cutoff, under which only $100 would be payable.

The other major argument of broadcasters against neighbouring rights is that the introduction of such a system would see Canada losing money. We know that clause 15 of the bill provides that Canada will pay neighbouring rights to Canadian holders of neighbouring rights and to those who are signatories to the Rome Convention. SOCAN receives payments from abroad, and it duly makes its own payments. A balance can therefore easily be struck between money coming into and going out of Canada.

Finally, according to the Donner report, neighbouring rights are an important tool for the future, especially with the advent of cable digital broadcasting, which will distribute digital quality music without interruptions from a announcer or any advertising. This distribution represents a source of revenue or important losses for performing artists and producers of sound recordings if the neighbouring rights regime is not introduced.

With respect to neighbouring rights, this is exactly the position adopted by the Bloc Quebecois. The Bloc made a firm commitment to support the introduction of neighbouring rights during the last election campaign. We are therefore consistent with what we promised during the campaign. In addition, since it was elected, the Bloc Quebecois has, on many occasions in the House and before the heritage committee, called for neighbouring rights legislation.

The Bloc Quebecois feels that by finally granting neighbouring rights to our performers and producers of sound recordings, Canada is making up for some very embarrassing lost time. It is regrettable, however, that the government limited itself to sound recordings and has not extended this right to audiovisual recordings. The Bloc Quebecois feels that exempting the first one and a quarter million in revenue from the payment of neighbouring rights is a large concession, too large, to the radio broadcasting industry. We will be making the necessary representations in order to lower this unacceptable cutoff substantially.

It is in fact the responsibility of the Copyright Board, not the legislators, to see that fees charged are compatible with the users' ability to pay. I must point out as well that no one wants to see any radio stations disappear, so the Board will take the stations' ability to pay into consideration.

Finally, the Bloc Quebecois would like to offer assurance that the creation of a new copyright scheme will not interfere with copyrights. To that end, section 90 ought perhaps to be strengthened to ensure that copyrights will be protected.

Neighbouring rights are an indispensable tool for bolstering our recording industry, whose Achilles' heel is underfunding. The recording industry is, moreover, dominated by multinationals. In Canada, Canadian-controlled businesses have marketed 71 per cent of Canadian content recordings. In Quebec, independent labels account for 31 per cent of the market, as compared to 10 per cent in Canada.

What is more, although foreign-owned recording companies are profitable, Canadian-owned ones are just beginning to be. As for the smaller ones, with annual earnings of under $100,000 and essentially Canadian-controlled, these have never been profitable, but they do play an important role in the development of Canadian talent, as the Donner report states on page 4. As far as neighbouring rights are concerned, yes, although the million and a quarter figure strikes us as completely exaggerated.

As for private copying, for which charges would be collected from manufacturers and importers of blank audiotapes, essentially cassette tapes, and then distributed among actors, composers, performers and producers of sound recordings, we know that 25 countries have adopted regimes that provide for collecting charges to compensate for incurred losses.

Last year, nearly 44 million of these blank tapes were sold. It is estimated that 39 million of them were used by consumers to privately copy sound recordings made by composers and artists who must earn a living from the sale of these recordings.

The Canadian sound recording industry loses significant revenue estimated at $324 million a year as a result of home copying. The Bloc also has a very clear position on this issue, which we expressed during the election campaign. We made a commitment to support charges on private copying. We also were in favour of collecting such charges on videotapes. We are therefore disappointed to see that the government went only halfway.

The Bloc is also happy to see that charges will not be set by legislators but by the Copyright Board. We would have liked the same thing for neighbouring rights.

As for distribution rights, we know that this bill will prevent parallel imports. The Bloc Quebecois therefore supports such a measure because it would strengthen the Canadian publishing industry, although it would have more of an impact in English Canada than in Quebec.

On the exceptions, however, we totally disagree with the government and we intend to work hard in this area when the bill is reviewed in committee. The current Copyright Act already provides for some exceptions. It provides for the use of works for the purpose of research and private study without having to pay royalties.

It provides for the use of works for the purpose of criticism, review or news summary preparation, if the source is mentioned. It provides for the public representation or publication of paintings and drawings of a work. The publication of short passages from

literary works in which copyright subsists in a collection, mainly composed of non-copyright matter, intended for the use of educational institutions is also allowed provided certain conditions are met. The list of exceptions goes on; it is about a page long, but these are the four main ones.

Bill C-32 considerably broadens these exceptions as they apply to educational institutions, libraries, archives and museums. To existing exceptions, it adds-and this is no small thing-the permission to use and reproduce works for the purpose of giving an assignment, test or examination; the permission to reproduce works that are not available in a medium of suitable quality.

The bill gives the right to perform in public and to broadcast sound recordings and television or radio programs in educational institutions. It also allows the reproduction of current affairs and other programs, and broadcasting in educational institutions. It allows libraries, museums and archives to reproduce works for management and conservation purposes, and to make photocopies of newspaper and magazine articles, under certain conditions, for their clients. It also allows these institutions to do authorized work.

It exempts libraries, museums, schools and archive services from their responsibility regarding production made by individuals on their photocopying machines. It recognizes the "no fault" principle when copyrights are violated incidentally and unintentionally. It recognizes the right to adapt works for the visually handicapped. Finally, the bill confirms the right of educational institutions and agricultural or industrial fairs to use works if the event is a non profit event.

You will understand that creators, particularly in Quebec, were stunned by the scope of the exceptions introduced as part of the copyright review. This exercise was meant to improve things, but the result is 12 pages of exceptions. This is unacceptable to authors and composers. Generally speaking, creators feel these exceptions violate the spirit of the act, which seeks to protect their rights, not deprive owners of their due. They also feel Parliament should have left users and collectives negotiate the use of their works, as is done with the Quebec education department and the federal government, and that these exceptions will create a jurisdictional nightmare. The terms used lend themselves to such interpretation that the door is wide open for users to refuse to pay their fees, until the courts clarify the provisions of the bill.

We believe that the exceptions are so convoluted as to be unmanageable, that they leave the door open to confusion, that they legalize delinquent behaviour by large institutions, that, under the pretext of balancing everyone's interests, they favour large government institutions to the detriment of much less powerful management companies.

The position of the Bloc Quebecois in this regard is also very clear. The Bloc Quebecois strongly protests this tactic by the government, which is taking advantage of the reopening of the copyright legislation to increase from one to 12 the number of pages devoted to exceptions. The Bloc Quebecois feels that these exceptions are to the detriment of authors and sees no reason why museums, libraries, schools and archives, which pay their employees, their oil and their electricity bills, should cheat authors, composers, performers and producers of their economic rights.

The Bloc Quebecois intends to show how these exceptions invalidate agreements that already exist between these large institutions and management companies. The Bloc also intends to show how these exceptions, in their present form, will lead to confusion and will pave the way for schools, museums, archives and libraries not to pay creators their due.

I would like to give some examples of these unacceptable exceptions. In clause 29.5 the following exception is described: it gives educational institutions the right to perform a work live or in public, to broadcast in public a sound recording or a performer's performance that is embodied in a sound recording, on condition that this is done on the premises of an educational institution, for educational purposes and not for profit, before an audience consisting primarily of students of the educational institution, instructors of the institution, or any person directly responsible for this institution. That is clause 29.5.

Now to the questions we in the Bloc are asking and, of necessity, they will be the questions asked by the creators as well. Why is such an authorization being given to educational institutions? Is an auditorium part of an educational institution's premises? That is not determined. Who will determine whether the event was held for educational purposes or to raise money? Who will determine whether the entrance fees were collected to generate profit or to meet the costs of holding the event?

Who will be stationed at the door to ensure that the audience are indeed students and staff of the educational institution? Will their parents be considered persons directly responsible for setting a curriculum for the educational institution? Do you see all the questions that just one of these exceptions prompts us to ask?

Now, for another exception in clauses 29.6 and 29.7. The purpose of this exception is to allow educational institutions to make a copy of a news or other radio or television program for educational purposes, to be replayed for the students of the institution. Copies may be retained for one year in the case of news broadcasts, and 30 days for other recordings, without copyright, in order to evaluate the educational suitability of such a program.

Then the royalties must be paid and the program may then be retained in keeping with the arrangements entered into with the collective society. The educational institutions must keep a log of their copies.

Imagine the complexity of such a disposition. It prompts us to ask a number of questions. How will the collective societies be able to administer this administrative muddle? Will programs such as serials, for example, be considered by a group of teachers in an effort to decide whether it is really a practical teaching tool? Why did the government not let educational institutions negotiate these points with collective societies as is done in other areas?

Let us consider clause 30, which allows the staff of libraries, museums and archives to make copies of works for clients for personal research purposes, on the condition that the individual satisfies the library, museum or archive that they will be used only for private study or research. Dream on. More questions arise about this clause. What criteria determine for library, museum or archive personnel that the copy requested is for personal ends? Here again, we have a practical example of the crazy limits of the exception.

Clause 30.3 provides that libraries, museums and archives will be cleared of responsibility for the use of their photocopiers, through the affixing of a notice above the photocopier asking users not to contravene the Copyright Act. What about the deals negociated by UNEQ and CANCOPY, which grant licenses to some education institutions in order to allow reproduction by their users for research purposes? Does this mean that, if someone infringes the Copyright Act by phocopying a book, for instance, the school authorities are going to shut their eyes and will not be held responsible?

Since when is an institution not responsible for its reproduction equipment? Photocopiers have become like coat racks with signs posted saying: "We are not responsible for photocopied material". That is what this section is saying. Clause 30.7 also says: "It is not an infringement of copyright to incidentally and not deliberately" use a work. Are there any other laws which state that a person who does something incidentally and not deliberately is not responsible? The guy who gets in his car after drinking and kills someone did not do it deliberately and therefore is not responsible. It is the same thing. That what is said here respecting copyright.

As I said earlier, the position of the Bloc is clear regarding the exceptions: they are unacceptable and far too many. The existing list was sufficient.

As for civil remedies, the last point I want to address, we know that copyright owners claim the present legislation does not protect their works because remedies provided are inappropriate, time-consuming and expensive. The measures proposed to rectify those irritants are simplified legal procedures that ease the process and lessen the potential costs of a lawsuit.

As for statutory damages, when infringement of copyright has been proven, the claimant can choose to have the amount of damages determined according to a schedule provided by the act.

Measures are proposed to prevent through injunctions experienced infringers from circumventing remedies, and to facilitate the granting of such injunctions. The Bloc essentially agrees with the part of the bill dealing with civil remedies.

I will conclude my remarks on the bill as a whole. Part II of Bill C-32 represents two steps forward, some sidesteps and many steps backwards. The steps forward are the recognition of neighbouring rights and levies on blank cassettes. The sidesteps are the exemption granted to broadcasters on the first $1.25 million in advertising revenue, and the steps backwards are unequivocally the exceptions added to the list.

This uneasiness is probably caused by the fact that the legislative aspect of copyright is the responsibility of Industry Canada not of Heritage Canada, which would have better defended creators' rights and would have been more impervious to the lobbying of the broadcasting industry and government agencies.

As a result, Part II leaves a bitter sweet taste, a mixture of emotions going from happiness, since new rights are recognized, to disappointment, as in the same breath we can wonder to what extent they really are recognized, and because copyright is being limited in a very real and concrete manner, without any valid reason.

Therefore, the Bloc Quebecois intends to work very hard on the heritage committee to analyze this bill after second reading, to improve, modernize and amend this bill which is an essential tool of policies promoting the cultural development in Canada and Quebec; this will have to be done with the greater respect for creators who are the very basis, the raw material, of this whole industry.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, it is a pleasure to speak to Bill C-32.

I must start by declaring my bias on this piece of legislation. I am a broadcaster by trade and it is important that I say that right away. In declaring that, perhaps I should take a couple of moments to explain why I think it is very important from the perspective of someone who has been in the broadcast industry that this legislation not come into place, not necessarily because it hurts broadcasters, although it does, but because it will hurt Canadian culture in general. I will expand on those remarks over the course of the next several minutes.

I should start by acknowledging the work of the hon. member for Kootenay East who now sits on the Canadian heritage committee, my colleague in the Reform Party, our heritage critic who has done a lot of work on this particular issue. He has many concerns and has provided me with some information.

I certainly was aware of the issue and I think hon. members in all parties were aware of it as well. There was a rather intense lobby from all sides with respect to this legislation and there is a good reason for that. The reason is this legislation will profoundly affect the various industries it touches.

I want to talk for a moment about the broadcast industry. The minister said a few minutes ago that the bill will strengthen Canadian culture. I am going to challenge that assertion. It will strengthen some aspects of Canadian culture but at the expense of other players in Canadian culture. I speak primarily of people in the broadcast industry.

I want to make the argument that hundreds of broadcasters in the big and small radio stations around the country are as much a part of Canadian culture as are the recording artists. Absolutely. I will give my personal perspective on this.

I ran a little radio station in Brooks, Alberta. I did that for 10 years. Prior to that I worked at radio stations throughout western Canada, some quite small, some a little larger in medium size markets. It is important to point out the value these little radio stations have in their communities. They are the glue that hold those communities together in so many ways.

The community of Brooks relied on my radio station for the local weather report which is something we take for granted. If we stop to think about it, it makes absolute sense that if we could not support that radio station because of yet another imposition of some kind of a tax, a levy or in this case, neighbouring rights which cause the radio station to go out of business, people who relied on the local weather report would be lost. We are talking about farmers, ranchers and those types of people. People wait to hear whether or not the school bus will be running because of a storm. They simply would not have that local information.

Another example of how radio stations hold communities together is the local news aspect. Many local communities have weekly newspapers but they do not have daily information. That is very important. I talked about the weather. If my memory serves me, the number one reason people listen to the radio is to hear the weather report. The second most important reason is local news. People want to hear what is going on in their community on a day to day basis. If because of government legislation some radio stations are knocked off the map and people cannot get the local information, the sense of community will be lost in a very real way.

I come from Brooks, Alberta which has a population of 10,000. It is quite far from any other major centre. There are many communities in that type of situation around the country. If those communities lost their local radio station it would be a tremendous loss because there would be no other radio station or TV station to jump in to fill the gap. It would be a terrible loss.

I know many hon. members opposite feel the same way. I hope I am not putting anyone on the spot when I read the following letter. That is certainly not my intent. I have a letter which was signed by the hon. member for Essex-Kent. It was sent to the former heritage minister. The letter states: "Neighbouring rights will add dramatically to this local programming loss across our country. Border communities such as Windsor and Sarnia are in a competitive market with the U.S.A. Added cost to the Canadian broadcasters will place them in a less competitive position. It is truly troubling to me to pass legislation that would place the radio broadcast industry in Canada at a disadvantage to their U.S. counterparts".

It is an excellent letter and the hon. member made some very good points in it. That is one huge reason the legislation is bad. Overall this legislation will cost Canadian broadcasters somewhere in the range of $30 million. That comes at a time when over half of the radio stations in the country are losing money, especially AM radio which is under tremendous strain because of fragmentation in the marketplace and new technologies. Suffice it to say that at the present time there are no technologies which can replace what radio is doing around the country.

This is an extremely important issue. Again I say to the minister that she is proposing legislation which will strengthen one aspect of Canadian culture, but it will greatly weaken another.

Another point is that there is really no reason to bring this legislation forward right now. That really bothers me. I do not understand where the minister is coming from. There is a longstanding historical understanding between the record industry and radio with respect to how record companies are compensated when radio stations play their music. If someone's music is played on the radio, obviously it will have an impact on record sales.

The broadcasters recently had Angus Reid conduct a study. It was discovered that about 45 per cent of music purchasers identified radio as the most important influence in their most recent music purchase. It outranked all other factors by a ratio of three to one. Overall, nearly nine in ten or about 88 per cent of Canadian music buyers rated radio to have been a somewhat to a very influential factor in their music purchase over the last year or two.

I get the sense that the minister is setting out to kill the goose that has laid the golden egg. The Canadian music industry and its artists are doing extremely well around the world. Not only are they popular in Canada but they are popular in the United States and Europe as well. There are many obvious examples. Therefore, the question is: If the present system is working extremely well, why are we engaging on a new course that could potentially undermine

the broadcasting industry, which is precisely the industry that has given many of these artists their start?

Many radio stations in order to help them get their licence tell the CRTC when they apply for their licence that they will commit to spending a portion of their profits on promoting new artists who do not yet have a record. They will help them record a song so that the artists can get some air play. In many instances the group, for example the one I belong to, CHUM Limited, a big chain across the country, would say that they would give the new artists free advertising of their records on their air waves.

This is seen as an important way to help fulfil the 30 per cent Canadian content rule, by ensuring that there are lots of good quality Canadian artists out there. A lot of time is spent coming up with ads to promote Canadian recording artists. What we are doing here is undermining the radio industry and therefore jeopardizing precisely the same artists the minister is intent on promoting.

Those arguments are good enough, but there are many other important arguments against this legislation. I want to make another right now with help from the member for Essex-Kent and his letter.

What we are proposing to do seems insane in many ways. We want to set upon a course that will provide neighbouring rights legislation which in effect will ensure that Canadian artists who receive a lot of air play in the United States will not benefit. In fact, they may be ultimately penalized-and I will get to that in a moment-by virtue of the government bringing in this neighbouring rights legislation. At the same time, we are providing a perverse incentive for Canadian broadcasters to play more American music. Let me explain how this works.

Neighbouring rights legislation will extend the current copyright legislation that applies to the composers of music on to the artists and the record producers. In other words, the producers and artists will enjoy the protection of copyright legislation. They do not enjoy it right now. The radio stations will pay for that. In Canada there will be a monetary incentive to play more American music because it is exempt from the copyright legislation. It is a crazy incentive to put in place if someone wants to promote Canadian music. It does not make any sense at all.

On the other hand, we are treating the Americans differently in Canada. They will not be subject to the new copyright legislation. We are treating American artists differently. That will make us subject to a challenge under NAFTA or under the WTO, which would quite possibly mean that the Americans could challenge us. It could mean that some of our artists will be ultimately denied from receiving air play in the United States.

The point with respect to this issue was extremely well made by the hon. member for Essex-Kent. I will read from the letter he sent to the heritage minister:

On Wednesday, November 1st, the U.S. government passed its Digital Performance Rights Act of 1995. This U.S. legislation excludes current radio stations, as well as future digital radio stations, from any form of neighbouring rights royalty payments. There is grave concern in the industry that any introduction of a neighbouring rights royalty in Canada will be detrimental to the radio industry which is already experiencing financial difficulties. Of equal concern is that Canada would have a different system than in the U.S.

The U.S. obviously is the big market for the majority of Canadian artists and also is our biggest trading partner. The letter goes on to state:

For example, if Canada were to have a neighbouring rights regime, which includes Canadians but excludes U.S. entertainers, it would be challenged under the WTO. The effect of a successful U.S. position is that approximately 70 per cent of the royalties paid by Canadian radio stations would be paid to foreigners, with no such return of revenue from the U.S. due to their exclusion. In any event, the U.S. has indicated that it would consider this system under the national treatment rules. This means that the U.S. will simply demand the same treatment for U.S. performers and record companies as given to Canadian performers and record companies.

In other words, because the Americans are excluded, we are going to send our people down there. They will not receive any royalties from the Americans because the Americans do not have this legislation. Radio is exempt under U.S. copyright rules. However, in Canada we will have the situation of a reverse incentive to actually play more American music because broadcasters will see a monetary benefit from it. It makes absolutely no sense. Not only that, we will possibly be subject to a NAFTA challenge or a WTO challenge. We have no idea of what the consequences of that could be. Suffice it to say the country music channel dispute shows us that the Americans are determined to play hardball when it comes to cultural industries.

One of the other concerns I have is with respect to how certain performers are going to benefit from this legislation while other performers are penalized. In relative terms, neighbouring rights legislation most benefits those Canadian artists who tend to receive more air play in Europe where neighbouring rights apply to private radio than in the U.S. where they do not. In practical terms this means that certain genres of music and music recorded in certain languages will benefit at the expense of others.

What is rather obvious, if I can state the obvious here, is that recording artists from Quebec are going to receive far more benefit from this than Canadian artists outside of Quebec. The reason is that most of the people who have signed on to the Berne convention are from Europe. Therefore, Quebec artists who sing in the French

language for instance are going to be the beneficiaries of this. However people who perform in English and have their primary market in the United States are not going to receive the royalties because, as I mentioned several times before, the U.S. excludes neighbouring rights from applying to private radio.

The legislation provides a benefit to francophone artists in particular, but also to other artists who perform in different languages and receive a lot of air play in Europe. Meanwhile, it does not help and most likely will hurt those Canadian artists who perform in the United States. The real situation is that the minister is pitting one group of artists against another. We are headed for trouble if we do that because it is wrong.

Another point I want to make is a little more complicated. Actually Europeans do much better with this deal than do Canadians overall because of our broadcasting system. In Canada literally hundreds of radio stations across the country broadcast to 30 million people. In Europe a fraction of that number of radio stations broadcast to 300 million people.

By virtue of how the neighbouring rights legislation is designed, what is important is how many spins of the record occur over the course of a year and not how many people it reaches. That is how the legislation is designed. In relative terms we will be sending a lot more money to Europe than Europe will be sending to Canada for our artists because of the way the broadcast system is designed.

We have a situation where European performers will actually do better than Canadian performers. It does not make any sense that our government would be promoting that. To me it is ridiculous and counterintuitive. Nonetheless that is precisely what is being proposed.

I will not belabour this point as there are people who would like to discuss other pieces of legislation. I sum up by saying that there is no support for the legislation across the way, as far as I can determine. There is certainly no support for it in my party or, I would argue, across the country.

I would argue that Canadians are very supportive of their local radio stations. People feel that Canadian performers are doing extremely well today. We see them all the time: Shania Twain and Michelle Wright. Many Quebec artists are doing extremely well around the world. To tinker with the current system is to invite disaster, to invite killing the goose that laid the golden egg. All this occurs at a time when private broadcasters are facing serious financial problems.

I cannot understand the motivation for the legislation given all the arguments against it. I encourage hon. members across the way, members of the Bloc Quebecois and certainly members of my own party, to go after the legislation.

I encourage the minister to justify why she is taking this course. I remind her that for every argument she puts forward in favour of the legislation there are three or four against it. I encourage her to think about that and to remember that the broadcast industry, speaking as someone who comes from it, is a very important part of Canadian culture. Steps should be taken not necessarily to promote it but certainly to stop the erosion of it that the Minister of Canadian Heritage is proposing.

[The Deputy Speaker]

It is my duty to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for Davenport-Law of the Sea Convention.

[Pat O'Brien, Liberal, London—Middlesex, ON]

Mr. Speaker, in his remarks just now the hon. member of the Reform Party made repeated reference to a letter from my colleague, the hon. member for Essex-Kent.

Bill C-32 was first introduced in the House on April 25. Before that date absolutely no one knew what would be in the bill. The letter to which the member opposite refers, the letter from the member for Essex-Kent, was written well before April 25. It is fair to say that Bill C-32 very adequately addresses and satisfies the concerns expressed in that letter.

I regard it not as a duty but as a privilege and a pleasure to speak to Bill C-32. I am genuinely pleased to have the opportunity of saying good things about a manifestly good piece of legislation.

It is with pride that I express my support for a cause so timely and just, so attentive to the principles of fairness and equity, so responsive to the exigencies of our modern age and so ultimately beneficial to Canadian culture.

I use this latter term somewhat guardedly. I am well aware of the dangers inherent in seeming to speak too annoyingly about culture with a capital c . Therefore, unless someone asks me to define the concept, a task that has defeated many a scholarly mind, allow me to resort to terms that most of us can more readily understand.

Here in Canada, the arts and cultural industries give work to more than half a million persons and put $16 billion annually into our national economy. Whatever our opinion might be on culture

with a capital "C", it is evident that, from a purely financial point of view, culture plays an important role in our country. Any measure supporting the livelihood of workers and the prosperity of their sector is ultimately supporting all of our economy and also our identity and our sovereignty.

Bill C-32 is one such measure. In fact, it is a whole series of measures applicable to copyright, an essential element for artistic creators of this country. Copyright is the legal framework whereby creators of works like movies, books, songs, information products and computer programs, receive some financial compensation whenever their work is used by other people.

Prominent among the bill's provisions is its so-called p and p component, which stands for performers and producers rights.

I heard a comment earlier asking whether I was reading my remarks. Yes, I am reading some remarks, but I can tell hon. members of the Reform Party that I have spent considerable months working on the issue with other members of my caucus. I am extremely well informed on the bill. I sit on the Canadian heritage committee as the vice-chair. I welcome the hon. member who made the comment or any others who come before the committee to address it. It is important legislation that we are quite prepared to examine in detail.

These p and p provisions will in effect extend royalty payments to producers and the performers of sound recordings. One might well ask whether royalties do not already ensue whenever recordings are broadcast over the air waves or performed in public. They do indeed, but under the current rights regime royalties in such cases go only to composers and lyricists of the songs in question.

In other words, when a radio station uses the latest recording by Céline Dion or Anne Murray of a song that happens to have been written by someone else, the songwriter gets duly paid for the use of the piece. However the company that made the recording and the song's performer and interpreter, Céline or Anne, do not. That is fundamentally unfair.

With this proposed legislation Canada will join the ranks of some 50 other countries that have already accepted the principle of performers and producers rights. Like them, we will at last recognize in law that those whose recording artistry and expertise bring a work into prominence are as deserving of royalties as composers or lyricists.

Some may look at the illustrious names I have just cited and suggest that I have not chosen the best examples to garner support for performers and producers rights.

Céline Dion and Anne Murray are, after all, fabulously successful and prosperous performers and have been so for some time. As such it may appear that they have little need for p and p royalties. To such a suggestion I would respond in two ways.

First, the Céline Dions and the Anne Murrays of the Canadian music industry are the exceptions, individuals who have reached the pinnacle of their profession. Below them, less visible but no less remarkable, lies a far faster preponderance of Canadian performers, musicians and recording artists, talented and dedicated professionals all but whose acquaintance with popular success may have proved at best fleeting, sporadic and far more modest.

Canadian artists are collectively among the least paid professionals in the country. For those who work in the sound recording industry, the prospect of sometimes getting performers and producers rights or a small fraction of the new royalty on blank audio cassettes could be valuable.

Second, whether rich or poor, famous or unknown, it does not matter what kind of person receives the performers and producers rights, because they are rights, not privileges, and these rights are theirs. They are based on the unquestionable principle of fair payment for work done.

If someone uses the product of my work, I am entitled to expect and to receive a fair payment from him, no matter who I am and what my achievements are, whether I am already rich or not, whether I do not particularly need money at the time or need it. If someone benefits from my works, if he exploits the product of the work I have done, I am entitled to expect a payment.

I realize that user pay approaches are far easier to defend in the abstract than in practice. In developing these legislative proposals we realized full well that we had little to gain by assisting one group and creating hardship elsewhere. That is why we were so careful to take account of the financial situation of broadcasters in establishing the new performers and producers regime.

Therefore members will not be surprised to learn that I am somewhat taken aback and disappointed with the vociferous stance against the bill being taken by certain broadcasters. They would have us believe that Bill C-32 will mean disaster for them, that it will push hundreds of financially beleaguered radio stations over the brink.

How can this be? How is it possible for the broadcasting industry to argue its interests have been irreparably damaged when we have taken such pains to minimize any potential adverse consequences, when they have been so careful to ensure that p and p royalty payments will accord with the ability to pay?

There are some 487 commercial radio stations in Canada. Of these approximately 65 per cent or well over 300 will be required to pay only a nominal flat fee of $100 per year, hardly a sum that is likely to push any station, beleaguered or not, over any brink.

This virtual exemption will apply to smaller stations right across Canada, those that take in annual advertising revenues of less than $1.25 million. This seems by any account a generous limit. Some are even saying it is too generous. It will in effect shelter $400 million, a full 55 per cent of all radio advertising revenue in the country.

As for the remainder of the country's radio stations the larger ones, the richer ones, those that take in advertising revenues in excess of $1.25 million, they will naturally be expected to pay more than the minimum $100 in keeping with their greater income.

Even so, the fees that are set will be phased in gradually over five years. Moreover, these fees will apply only to that portion of advertising revenues in excess of $1.25 million. As an additional measure of prediction the amount of the fee will be established by the copyright board after an open consultative process and after hearing from interested parties on the subject.

The bill will go to the committee on Canadian heritage, of which I am vice-chair. It is a very technical bill. We are certainly open to hearing input from all members. We believe the bill will stand on its merits and will bear careful scrutiny.

The House resumed consideration of the motion that Bill C-20, an act to respecting the commercialization of civil air navigation services, be read the third time and passed, and of the amendment.

Civil Air Navigation Services Commercialization Act

[The Deputy Speaker]

We will now proceed to the taking of the deferred recorded division on the amendment.

Call in the members.

(The House divided on the amendment, which was negatived on the following division:)

[The Speaker]

I declare the amendment defeated. The next question is on the main motion.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Mr. Speaker, perhaps the House would give its unanimous consent to apply the same result in reverse to the main motion for third reading of Bill C-20, and adding as voting yes the hon. Minister of Health and the hon. Minister of Indian Affairs and Northern Development.

[The Speaker]

I understand the member for Kenora-Rainy River and the Minister of Finance want to be included in the vote.

Is there unanimous consent?

[Some hon. members]

Agreed.