Letter from Industry Canada and Canadian Heritage to CRTC

June 14, 1995

Mr. Allan J. Darling
Secretary General
Canadian Radio-television and Telecommunications Commission
1, Promenade du Portage
Hull, Quebec
K1A 0N2

Dear Mr. Darling: 

This is further to your letter of April 24, 1995, providing comments on proposed policy directions under the Broadcasting Act with respect to Direct-to-Home (DTH) satellite distribution and pay-per-view television programming undertakings.

Your letter, and subsequent public comments made by the CRTC on the subject of the proposed directions, have indicated that there is a need to clarify government policy concerning the use of Canadian satellite facilities for the transmission of Canadian programming services in Canada, and in particular for DTH satellite distribution and pay-per-program services.

Attached is a clarification of the government's policy on this matter. Please let us know if you have any further questions on this matter.

_____________________________
Harry Swain
Deputy Minister
Industry Canada

_____________________________
Marc Rochon
Deputy Minister
Canadian Heritage

Encl.

The following is a clarification of Canadian policy concerning the use of Canadian satellite facilities, as it applies to broadcasting undertakings.

One of the policy objectives in Section 7 of the Telecommunications Act is: "to promote the use of Canadian transmission facilities for telecommunications within Canada and between Canada and points outside Canada". A long-standing application of this policy is to ensure the use of Canadian satellite facilities for traffic originating in Canada and destined for Canadians.

A policy objective of the Broadcasting Act is that: "each broadcasting undertaking shall make maximum use, and in no case less than predominant use, of Canadian creative and other resources in the creation and presentation of programming, unless the nature of the service provided by the undertaking, such as specialized content or format or the use of languages other than French and English, renders that use impracticable, in which case the undertaking shall make the greatest practicable use of those resources".

In this context, where a Canadian broadcasting undertaking wishes to use foreign satellite facilities, the Canadian policy concerning the use of satellite facilities should be interpreted as follows: 

• the undertaking should make use of Canadian satellite facilities to carry (i.e. receive and/or distribute to Canadians) all Canadian programming services but may use either Canadian or non-Canadian satellite facilities to carry foreign originated services that are intended primarily for foreign audiences, and are authorized, in whole or in part, for distribution by the CRTC; and

 
• under no circumstances should an undertaking use exclusively foreign satellites for the distribution of its services to Canadians. However, in the case of emergencies leading to lack of availability of Canadian or foreign satellite facilities, back-up agreements between the two countries would be utilized.

It should be understood that a range of licensing options is possible under this policy. For example, in the case of a pay-per-program or multi-channel (other than simply multiplexed) undertaking, the Commission could choose to authorize a pre-existing foreign component which is intended primarily for foreign audiences, within the licensed undertaking or separate from, but linked to, the licensed undertaking. In either case, the Canadian component would be carried on Canadian satellites while the foreign component could use either Canadian or foreign satellites.