COPYRIGHT REGULATIONS

Definition of "Small Cable Transmission System" Regulations

Definition of "Small Cable Transmission System" Regulations
(SOR/94-755)

P.C. 1994-2010 6 December, 1994

His Excellency the Governor General in Council, on the recommendation of the Minister of Industry, Science and Technology and the Minister of Communications, pursuant to subsection 67.2(1.2)* of the Copyright Act, is pleased hereby to make the annexed Regulations defining "small cable transmission system" for the purpose of subsection 67.2(1.1) of the Copyright Act.

* S.C. 1993, c. 23, s. 4(1)

SHORT TITLE

1. These Regulations may be cited as the Definition of "Small Cable Transmission System" Regulations.

INTERPRETATION

2. In these Regulations,

"licence" means a licence issued under paragraph 9(1)(b) of the Broadcasting Act authorizing the licensee to carry on a broadcasting receiving undertaking that distributes programming services to premises by means of signals that are transmitted by cable;

"licensed area" means the area within which a licensee is authorized, under its licence, to provide services;

"premises" means

(a) a dwelling, including a single-unit residence or a single unit within a multiple-unit residence, or

(b) a room in a commercial or institutional building.

SMALL CABLE TRANSMISSION SYSTEM

3. (1) Subject to subsections (2) to (4) and section 4, for the purpose of subsection 67.2(1.1) of the Copyright Act, "small cable transmission system" means a cable transmission system that transmits a signal, with or without a fee, to not more than 2,000 premises in the same licensed area.

(2) For the purpose of subsection (1), where a cable transmission system is included in the same unit as one or more other cable transmission systems, the number of premises to which the cable transmission system transmits a signal is deemed to be equal to the total number of premises to which all cable transmission systems included in that unit transmit a signal.

(3) For the purpose of subsection (2), a cable transmission system is included in the same unit as one or more other cable transmission systems where

(a) they are owned or directly or indirectly controlled by the same person or group of persons; and

(b) their licensed areas are each less than 5 km distant, at some point, from at least one other among them, and those licensed areas would constitute a series of contiguous licensed areas, in a linear or non-linear configuration, were it not for that distance.

(4) Subsection (2) does not apply to a cable transmission system that was included in a unit on December 31, 1993.

4. The definition set out in subsection 3(1) does not include a cable transmission system that is a master antenna system located within the licensed area of another cable transmission system that transmits a signal, with or without a fee, to more than 2,000 premises in that licensed area.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Regulations)

Description

Presently, there are no regulations, pursuant to subsection 67.2(l.2) of the Copyright Act, defining "small cable transmission system".

Under the provisions of the Copyright Act, the Copyright Board is responsible for approving the tariffs for the communication to the public by telecommunication of musical works. The Copyright Act requires that the Board, when approving these tariffs, set a preferential rate for small cable transmission systems.

The new regulations define a "small cable transmission system" as one serving not more than 2,000 premises in the same licensed service area as set out by the Canadian Radio-television and Telecommunications Commission (CRTC). The use of the concept of licensed area and the qualifying threshold of 2,000 premises reflect the approach used by the CRTC when determining eligibility for small system status in relation to broadcast licenses and was chosen after consultations with rights holders and cable company associations. The new regulations also ensure that Master Antenna (MATV) systems will be treated as separate from the cable transmission system in a licensed area.

The new regulations also establish that where two or more licensed areas that are controlled, directly or indirectly, by the same person or group of persons are less than 5 kilometres apart at any point, the number of premises for the purposes of the new regulations include the premises in all the licensed areas. This contiguous clause does not apply to any licensed area which existed prior to December 31, 1993.

Alternatives

Implementing the regulations defining "small cable transmission system", as prescribed by the Copyright Act, is the only effective means for the preferential rate to be used by a cable company. This preferential rate will be set by the Copyright Board. Without a definition all cable companies would, very likely, have to pay the full rate set by the Copyright Board.

Benefits and Costs

The new regulations ensure that small cable transmission systems will benefit from a preferential rate to be set by the Copyright Board for the communication to the public by telecommunication of musical works under section 67 of the Copyright Act.

The total cost of the regime to the industries affected, and the relief granted to small systems by virtue of the new regulations, cannot be determined at this time because of the nature of the copyright licensing regime, which envisages a tariff-setting process before the Copyright Board. Implementing the Regulations defining "small cable transmission system" should reduce the cost impact of the tariffs for the communication to the public by telecommunication of musical works. There should be no additional cost to the government because of this implementation.

Consultation

As a result of publication in the Canada Gazette Part I on July 30, 1994, comments were received from three cable associations or companies: Canadian Cable Television Association (CCTA), Canadian Satellite Communications (CANCOM), and Regional Cablesystem Inc. (REGIONAL). Comments were also received from three collecting organizations: Copyright Collective of Canada (CCC); the Society of Composers, Authors and Music Publishers of Canada (SOCAN); and Border Broadcasters Inc. (BBI). All of these associations or organizations were involved in the consultations held prior to publication in Part I.

The cable associations were generally supportive of the change from "1,000 premises in the same community" to "2,000 premises in the same licensed area". They objected to the concept of the contiguous clause. Specifically, CANCOM and REGIONAL requested that the 10 km requirement be changed to 2 km and that the wording of the contiguous clause be clarified. CCTA requested the addition of a new subclause which would prevent the application of the contiguous clause when a cable transmission system is purchased, thereby changing ownership. Also, REGIONAL requested changing the grandfathering clause from December 31, 1993, to December 31, 1994.

The collecting organizations, were supportive of the change from "community" to "licensed area". BBI objected to the change from 1,000 to 2,000 premises. The collecting organizations also requested changes to the wording of the contiguous clause. CCC and SOCAN requested that MATV systems not be entitled to the preferential rate if the surrounding cable transmission system is not a small cable transmission system.

The government has changed the 10 km requirement to 5 km as a compromise and has clarified the wording of the contiguous clause in response to these comments. The government is satisfied that the contiguous clause meets the objective of giving small cable transmission systems a preferential rate, and chose December 31, 1993, as appropriate because of the ongoing consultations with stakeholders throughout 1994. The government is also satisfied that 2,000 premises is the appropriate compromise and that MATV systems are being treated properly so has made no changes in the regulatory text in these areas.

Early notice was provided in the 1994 Federal Regulatory Plan no. HER-17.

Compliance and Enforcement

It is for the Copyright Board to determine the liabilities that flow from implementing the regulations defining "small cable transmission system".