Madam Speaker, it is my pleasure to speak to the Senate amendments to Bill C-55, an act respecting advertising services supplied by foreign periodical publishers.
I have been on my feet many times over the last year on this bill. I have been asking questions, making statements and following it very closely. This is kind of the 11th hour on this debate and I will try to say some things that mean something to me at this time.
I am very concerned about the direction the bill has taken. I will speak personally as a new rookie MP. I have watched the bill with great interest from its inception around a year ago. I remember watching a press conference on television. The ministers of heritage and industry were tanned and confident as they talked about this wonderful bill which had been crafted, which was WTO-proof, dragon-proof and was going to be able to defend us in the big, wide world of mega-magazines and split runs and all of that.
We all felt good about that in our hearts. We thought it sounded good. It sounded like a net benefit to Canadian culture, as we see so much stuff coming across our border that is not Canadian.
The New Democratic Party and I gave our cautious consent because there were things in it that we did not really agree with. We would have liked to have seen it go further, but we did believe in the spirit of it. We believed that it was an effort to say that we can work within the trade agreements and protect our culture at the same time.
We are now a year down the line. The bill that was put forward that day was digested and picked over by all of us. I will talk about some of the contents of the Canadian-made Bill C-55 just for the record. It is no longer there, but these are some of the ideas we were supporting.
Bill C-55 was to make it an offence to provide Canadian advertising services aimed at the Canadian market to be placed in foreign periodical publications, except for those currently receiving Canadian advertising. For people who do not understand anything about this business and are probably sick to death of hearing about it without understanding it, the whole basis of this is that there is a certain amount of money out there for magazines to use to create their product. It is the Canadian advertising industry which Canadian magazines are dependent on for their survival, along with government subsidies and the enormous support they get from the people who buy the magazines.
The bill is all about advertising. It is about trying to protect this pool of advertising, this amount of moneys that is available to support our industry, our writers, our editors, our publishers, our photographers and all of the people who want to read our stories. That was the intent of Bill C-55 that sunny day many months ago.
There was an offence, which would have been enforceable by Canadian law, after an investigation was ordered by the Minister of Canadian Heritage. This would have happened if foreign periodical publications used Canadian advertising. The penalties would have ranged from the maximum of $20,000 for an individual's first offence on a summary conviction, to $250,000 for a corporate offender on indictment. Offences that took place outside of Canada by foreign individuals or corporations would have been deemed to have taken place in Canada for the purposes of enforcement of the act.
I am using the past tense because this is no longer the bill that we are talking about.
The government would have collected unpaid fines levied upon conviction in the same manner as a civil judgment. The cabinet would have made regulations relating to the investigators, the conduct of the investigations and the definition of the Canadian market.
The whole bill was based on the fact that we were going to protect the Canadian advertising market for Canadian magazines. The minister of culture had her dukes up. She was ready to fight. She was ready to stand up to the American bully. We heard this over and over.
Before I go on, I will say that I like American magazines. I do not want to say that they have no place in this constellation. I like them a great deal and I have tremendous admiration for American writers. I like a whole lot about the United States and its talent and its spirit. A lot of its talent and spirit managed to manifest itself in this deal but it was not to our benefit. It was to the American's benefit.
It is not the talent and spirit of the Americans that I do not like, it is the velocity and the volume of the American product that just overwhelms our shores. I think that Bill C-55 was an 11th hour effort to protect the Canadian magazine industry from being swamped by thousands of shiny, glossy, sexy American magazines which we see row by row, bicep by bicep, cleavage by cleavage in our airport bookstores and in chains of American bookstores, which we now have all over our country.
What we were hoping was going to happen was that we would have some control over this wave, which was what the Canadian version of Bill C-55 was all about.
However, what we have seen is a complete collapse of the government's will to stand up to the American bully in the final analysis. In one of my first experiences as a rookie MP, it was a very sad day when I heard that the deal, which we had taken through the House in a democratic process, had collapsed.
When I look around the room, I see others who might feel the same; that we were doing some good work in terms of looking at this legislation and really trying to make some amendments to make it as good as it could be. We voted on Bill C-55 and sent it to the Senate.
What I was not aware of was that the democratic bills in the House of Commons go somewhere else. They go to Washington where they are really worked on. That was quite a shock to me. I think it would shock most Canadians to realize that there is actually a four stage journey or maybe five. It goes from the House to the Senate, from the Senate to the United States, back to the Senate and then it comes back to the House to be rammed through.
The bill that has come back here, which went to the Senate from the United States in the last couple of weeks, is a very different bill. It is one which I will run through right now and then tell the House what it means to the people in the magazine industry, to the people who like to read Canadian magazines and to the cultural workers in the country.
The made-in-America deal, which has just been penned and signed, commits Canada to amend our foreign investment policy so it falls under section 38 of the Investment Canada Act, allowing for the cabinet to regulate and prescribe what and how much foreign ownership Americans can have in our industry. The agreement also forces Canada to allow for increased ownership, up to 51% after 90 days, and up to 100% within a year.
The new made-in-America Bill C-55 also commits Canada to change the Income Tax Act to allow advertisers to receive deductions for placing ads in American publications aimed at the Canadian market.
The new made-in-America Bill C-55 contains a “without prejudice” section to diminish the agreement's ability to set a precedent under the WTO, NAFTA, Investment Canada Act or under Bill C-55.
One of the central issues that I am concerned about is that this deal sets out the surrender of our market by prescribing the formula to allow for American split runs to invade our market with a total of 12% of total Canadian ad content immediately, rising to 18% within 36 months.
The tax act shall also be amended to allow for one-half deductions in magazines with up to 79% original content and 100% for publications with more than 80% original editorial content.
The definition of Canadian content at this point in time is one that I am extremely concerned about because it has now metamorphosed into a completely different meaning than the one we all knew it to be, and that is one of being material written by Canadians or having some involvement by Canadians. One of the questions I asked the minister today in the House of Commons dealt the issue of Canadian content.
The new wording for Canadian content means that as long as it is original to a split-run magazine in Canada then it is considered Canadian content. It no longer has to be written or published by a Canadian or have a Canadian theme. Nothing like that is important any more, as long as it is created originally for the Canadian market and has not appeared in another edition in Canada. The idea of Canadian content is watered down so significantly that I fear very much the precedent it is setting for all of the other Canadian cultural industries which are also very much dependent on the idea of Canadian content.
I would like to mention right now some of the impact this is going to have on our industry. We have over 900,000 Canadian workers in culture. This is a 1997 UNESCO figure. We have a responsibility in the House to protect these workers along with the idea of Canadian content.
We were told by the government that we had a chance to stand up to the American entertainment monolith. We had a chance to defend this at the WTO but we did not do that. We did not use our cultural exemption contained in NAFTA. We ignored our own legal advice regarding Bill C-55 being WTO proof. We basically showed the Americans that we had no interest in protecting culture. I think that is coming right down to the bottom line.
We have simply said “It is all right, this is just one more product we will negotiate with you and we will in fact give in to you”. The only lesson the Americans have learned here is that if they threaten a trade war with the Canadians, do not worry because the Canadians will surrender.
By refusing to use the existing trade rules to protect our magazines we are saying we will allow the Americans to make up international rules as they go along. It is therefore only a matter of time before American interests go after Canadian content on television, ownership levels in our broadcasting industry, support for our book publishing industry, support for our feature films and so on.
The creation of this new fund, which is going to be a fund to augment the deathblow to the Canadian industry, is suspect. This government reduced direct cultural support by over $500 million between 1993 and 1998. That is in the official estimates. Any new fund will not necessarily restore money and there is no indication at this point where the money is coming from.
In closing, I would like to read into the record a motion that I was going to put forward. It is interesting that the Reform member put forward a motion which said the new made in America Bill C-55 did not go nearly far enough. I was going to put another motion forward. I will read it into the record.
The motion we would have moved would have been:
That the motion be amended by deleting all the words following “That” and substituting the following:
—a Message be sent to the Senate to acquaint Their Honours that this House disagrees with the amendments made by the Senate to Bill C-55, an act respecting advertising services supplied by foreign periodical publishers, for the following reasons:
The Senate amendments subvert the intent of Bill C-55 to protect the Canadian periodical industry in the face of American based split-run magazine editions and actually threaten the future of the Canadian periodical industry by
(a) granting a substantial amount of Canadian advertising services to foreign periodical publications aimed solely at the Canadian market;
(b) giving incentives to new foreign periodical publications to be created and aimed at the Canadian market that were not foreseen or discussed by the Standing Committee on Canadian Heritage in their study of the bill;
(c) granting sweeping powers to the Governor in Council to define revenue levels and determine Canadian content especially but not exclusively in section 20 of the bill.
In closing, we believe that American made Bill C-55 is a craven bill and a tragedy for Canadian culture.