Canada Gazette, Part I, Volume 157, Number 23: Order Issuing Directions to the CRTC (Sustainable and Equitable Broadcasting Regulatory Framework)
June 10, 2023
Department of Canadian Heritage
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Order.)
Issues: Online broadcasting undertakings have a significant impact on Canada’s broadcasting system, but have been exempt from broadcasting regulations. While many online undertakings make significant investments through foreign location and service production, they lack obligations to reinvest into production of Canadian content and support local creative talent. This shifting market reality will undermine the objectives of the Broadcasting Act (the Act) if the regulatory regime is not updated and modernized. The long-term viability of Canadian broadcasters is also at risk, as these broadcasters face both unfavourable market trends and an uneven regulatory regime that inhibits their ability to innovate, compete and serve communities.
Description: The Government is proposing to issue policy directions to the Canadian Radio-television and Telecommunications Commission (the Commission) under section 7 of the Broadcasting Act. The proposed directions would give binding, high-level direction to the Commission as it engages Canadians and all interested parties to design and implement a new regulatory framework through an open, public dialogue.
The proposed directions articulate key priorities and support important outcomes for Canadian audiences, creators and broadcasters. Key elements of the proposed directions include
- Ensuring the meaningful participation of Indigenous persons in the broadcasting system;
- Excluding social media users and creators and their content from regulation;
- Supporting greater inclusion of equity-seeking groups in the broadcasting system;
- Supporting Canadian creators and media, including independent and community-run elements;
- Implementing discoverability requirements in a way that minimizes the need to alter algorithms of broadcasting undertakings and that, where possible, increases choice for users;
- Redefining Canadian programs; and
- Creating an equitable, flexible and adaptable regulatory framework.
The proposed directions would outline the appropriate scope of regulation and where flexibility should be part of the framework.
Rationale: Between 2018 and 2020, the Broadcasting and Telecommunications Legislative Review (BTLR) Panel conducted extensive consultations across Canada with the public at large, industry stakeholders and academic experts. It heard from diverse parties including Indigenous communities, official language minority communities (OLMCs), public-interest groups, accessibility groups and others. The Panel’s final report highlighted the pressing need to ensure that those who benefit from broadcasting in Canada contribute to the sector. The Government introduced legislation to reform the Broadcasting Act to ensure Canada’s laws reflect the evolving digital world and create a regulatory system where web giants contribute to the creation and promotion of Canadian stories and music.
The Online Streaming Act and the proposed policy directions aim to address regulatory imbalances and the risks to funding for Canadian programming, while excluding social media creators from regulation. Shifts in the broadcasting sector risk undermining contributions to the production of Canadian audio and audio-visual content. Through the BTLR process and elsewhere, stakeholders have emphasized the importance of ensuring continued support in order to preserve Canada’s cultural identity and sovereignty. They also urged a regulatory framework that treats players equitably.
The Canadian broadcasting sector is an important cultural sector that provides diverse programming — such as programming for children and youth, dramas, documentaries, news and public affairs — for Canadian audiences, promotes democratic expression, allows for cultural exchanges and is important to social cohesion. Canadian broadcasters operate in every province and territory, contributing to local, regional and national culture and communications. Many of these broadcasters have been advocating for changes to broadcasting regulations so that they can continue to serve Canadians in their communities.
The proposed policy directions take into account important contextual factors such as the United Nations Declaration on the Rights of Indigenous Peoples, Canada’s two official languages, improved outcomes for equity-seeking groups, digital and sectoral transformation, and Canada’s international commitments.
By directing the Commission’s priorities, the proposed directions would clarify for both the Commission and the public certain ways in which the Commission must use its resources. Benefits would result from the Commission’s actions taken after the proposed directions come into force, setting the stage for anticipated benefits including support for Canadian broadcasters and the broadcasting environment, and support for Indigenous peoples, equity-seeking groups, Canadian programs and creators, and opportunities for small businesses.
Online broadcasting undertakings have dramatically changed how Canadians watch television and movies, and how they listen to music. Since their entry into the Canadian market, online undertakings have become integral to Canada’s broadcasting system, but they have been exempt from Canada’s broadcasting regulations through decisions such as the Exemption order for digital media broadcasting undertakings (the Digital Media Exemption Order). While many online undertakings make significant investments through foreign location and service production, they lack obligations to reinvest into the production of Canadian content and to support local creative talent. Broadcasting regulations have always required such reinvestments, but broadcasters have experienced a decrease in subscribers and revenue that have led to lower contributions to Canadian content.
At its heart, the Act exists to promote diverse Canadian expression and the cultural and economic benefits that follow. The shifting market reality will undermine the Act’s objectives if the regulatory regime is not updated and modernized. The long-term viability of Canadian broadcasters is also at risk, as these broadcasters face unfavourable market trends and an uneven regulatory regime that inhibits their ability to innovate, compete and serve communities.
It is important that Canada’s broadcasting regulatory framework is structured to recognize the role of online broadcasting. The Online Streaming Act and the subsequent policy directions are needed to ensure that those who benefit from the Canadian marketplace are also required to contribute proportionately to local cultural production, thereby upholding support for a wide range of Canadian music, stories and creators.
On April 27, 2023, Bill C-11, the Online Streaming Act (S.C. 2023, c.8) received royal assent. The Commission’s implementation of its new roles and responsibilities are underway.
Broadcasting Act review
In June 2018, the Government of Canada appointed the BTLR Panel to review the legislation that governs Canada’s communications sector: the Telecommunications Act, the Radiocommunication Act, and the Broadcasting Act.
The Panel issued a final report containing 97 recommendations to the Minister of Canadian Heritage and the Minister of Innovation, Science and Industry on January 29, 2020. Among such recommendations, the BTLR report highlighted the pressing need to ensure that those who benefit from broadcasting in Canada — including large foreign companies — contribute to ensuring continued support for the creation, production and discovery of Canadian content.
The BTLR report illustrated important imbalances in Canada’s broadcasting system that the Online Streaming Act has sought to address by updating the Commission’s regulatory powers so that the system can better support content creators, bringing online undertakings into the regulated broadcasting system, and supporting greater inclusion of Indigenous persons, Black and other racialized persons, and members of other equity-seeking communities in the broadcasting system.
The Government introduced and passed legislation to reform the Broadcasting Act to ensure Canada’s laws reflect the evolving digital world and create a regulatory playing field where web giants contribute to the creation and promotion of Canadian stories and music. In practice, this requires ensuring that all broadcasting undertakings contribute meaningfully to the Canadian broadcasting system. This is clearly stated in the December 2021 Mandate Letter to the Minister of Canadian Heritage and the 2021 Speech from the Throne. The Government’s continued commitment to modernizing broadcasting legislation builds on past work and similar calls to action in previous mandate letters. Finally, fostering creativity, innovation, growth and employment opportunities in Canada’s cultural sector and in the creative economy is a core responsibility of the Department of Canadian Heritage (the Department). The Department and the Commission have both led several years of research and stakeholder engagement to support revisions to the Act.
Canadian broadcasting sector
Broadcasting is an important cultural sector that provides diverse programming — such as programming for children and youth, dramas, documentaries, news and public affairs programming — for Canadian audiences, promotes democratic expression, allows for cultural exchanges and is important to social cohesion.
Canadian consumers generated domestic demand worth over $5 billion in 2021. Competition driven by global services has benefitted domestic consumers and creators while creating new opportunities and challenges.
Canadian broadcasters operate in every province and territory, contributing to local, regional, and national culture and communications. They are large, medium, and small businesses and organizations. They operate more than 800 commercial radio stations and almost 200 campus, community, and Indigenous radio stations. They provide hundreds of television stations and bring cable and satellite services to Canadians’ homes. They create and broadcast Canadian content, report local news, and give voice to communities in Canada.
Important contextual factors
The factors below have informed the Department’s proposed policy directions to the Commission. Taken together as elements of an evolving broadcasting system, they have been fundamental considerations in developing the proposed directions.
United Nations Declaration on the Rights of Indigenous Peoples
The Declaration is a source for the interpretation of Canadian law that Indigenous peoples and the Government of Canada have been working to implement to advance reconciliation, healing and cooperation.
Canada’s official languages
Online broadcasting undertakings that operate in Canada have been doing so primarily in English. Given the pre-existing minority context of the French language in Canada and North America, this has sharpened the challenges faced by audiences seeking content in French, and by those seeking to create programming in French.
Serving equity-seeking groups
The broadcasting system should serve the interests of all Canadians. Part of this is recognizing and overcoming the challenges faced by certain Canadians, including Indigenous persons, Black and other racialized persons, Canadians of diverse ethnocultural backgrounds, members of OLMCs, persons with disabilities, members of 2SLGBTQI+ communities, women, and members of other equity-seeking groups.
Digital and sectoral transformation
The digital age has transformed how cultural products are created, shared, and accessed within an increasingly open, global and dynamic marketplace. As part of this transformational change, the broadcasting system now includes undertakings that allow audiences to select programs from a catalogue on demand, others that allow users to upload their own programs for reception by the public, and linear broadcasting undertakings providing programs at a scheduled time and enjoyed simultaneously by audiences.
Through these transformations, there has been greater foreign competition for Canadian viewership. Ownership and control of the broadcasting system by Canadians have been and continue to be an important element of Canada’s broadcasting policy; they contribute to Canadian cultural sovereignty and the success of Canadian artists and creators.
Audio and audio-visual media production is rapidly evolving and engages a diversity of participants including companies of all sizes, public agencies, non-profits, self-employed artists, collectives, partnerships, and hobbyist creators.
The role of social media services in the lives of Canadians continues to grow. These services provide Canadians with opportunities to easily discover, access, create, and share programs online. Content created by social media creators has become an important tool for the promotion of self-expression, and these content creators have increased the diversity of voices available to Canadian audiences.
Social media services are also increasingly competing with and acting as substitutes for broadcasters in their role as distributors of commercial programming, such as movies, TV shows, music, and spoken word programming.
As online broadcasting undertakings and social media services collect more data and information, it is clear that Canadians want their privacy to be respected and protected.
Canada’s international trade commitments in relation to digital commerce and services are an important contextual consideration in the modern broadcasting system. Canada also has responsibilities, along with an international cohort of partners, as a signatory to the UNESCO 2005 Convention on the Protection and Promotion of Diversity of Cultural Expressions. The Convention is an international standard-setting instrument that formally recognizes the dual nature, both cultural and economic, of contemporary cultural expressions produced by artists and cultural professionals, including in the digital environment.
The discoverability of minority cultural content online, systemic bias in algorithmic design and operation and the need for greater transparency and disclosure of the impacts and influence algorithms can have on users have been long-standing concerns. Canada leads an international multi-stakeholder working group, which complements the Commission’s work and which has drafted guiding principles on diversity of content online to provide a framework that addresses these challenges.
The proposed policy directions would bind the Commission as it engages Canadians and all interested parties to design and implement a new regulatory framework through an open, public dialogue. The proposed directions would support the production, promotion and discoverability of Canadian music and audio-visual programs. They would also provide guidance regarding the appropriate scope of regulation and outline where flexibility should be part of the regulatory framework.
The proposed policy directions would instruct the Commission to do the following:
Ensure meaningful participation of Indigenous persons
The Commission would be directed to support the meaningful participation of First Nations, Inuit, and Métis peoples in the broadcasting system. This would include a direction to support the production of, and audience access to, programs owned and controlled by First Nations, Inuit, and Métis people, and support for First Nations, Inuit and Métis broadcasters. In order to ensure its work is responsive and targeted, the Commission would be directed to meaningfully engage with First Nations, Inuit and Métis partners, governments, broadcasters, creators, producers, industry organizations, and community members.
The Commission would also be directed to consult on how to best support narrative sovereignty, a concept which emphasizes the importance of Indigenous peoples telling Indigenous stories. The Commission would be further directed to consider how its consultations and actions will further the objectives of the United Nations Declaration on the Rights of Indigenous Peoples, including self-determination and Indigenous peoples establishing their own media.
Exclude social media creators
The Commission would be directed to exclude from regulation:
- Content made by social media creators;
- Content of podcasters who primarily use platforms that allow podcasters to upload their content without exercising control over the selection of programs for transmission;
- Any content on social media that is not also made available on a non-social media broadcasting undertaking; and
- Video games.
The proposed directions build on provisions in the Online Streaming Act and deliver on commitments by the Government to ensure that the Commission would only regulate social media platforms insofar as they are acting like broadcasters and not the social media elements of their services, which include any content created and uploaded by everyday users (commonly known as user-generated content).
Support diversity and inclusion
The Commission would be directed to meaningfully engage with Black and other racialized communities, OLMCs, and other equity-seeking groups regarding support for the creation, availability and discoverability of programming made by members of these communities and groups. The Commission would also be directed to ensure its expenditure requirements support the creation of programming by creators from these groups and communities, taking into consideration challenges they face, including systemic racism and the minority context of French in Canada.
In order to increase programming access to more Canadians, the Commission would be directed to regulate and supervise the broadcasting sector in a way that supports programming being available without barriers to persons with disabilities.
Support Canadian creators and media
The Commission would be directed to craft a clear methodology for financial contributions and obligations, including from online undertakings, to support and promote Canadian programming and creators. In developing this methodology, the Commission would be directed to consider a number of priority factors and policy goals.
The Commission would be directed to maximize the use of Canadians in the creation, production, and presentation of programming and to consider the impact of its regulatory approach on Canadian producers, creatives and other personnel in the context of how their economic opportunities and remuneration are significantly impacted by changes to the Canadian broadcasting industry. The Commission would also be directed to support activities and services, such as training and development for Canadian creators, including social media creators.
Discoverability and showcasing
The Commission would be directed to take into consideration various means of discoverability and showcasing such as off-service and on-service interventions to promote a wide range of Canadian programs and creators. The directions would be to prioritize an approach that targets outcomes, such as measures of audience size or the ability of users to find Canadian programs.
The Commission would also be directed to implement discoverability in a way that respects and, where possible, increases choice for users while also minimizing the need to alter algorithms of broadcasting undertakings. In its implementation of discoverability and showcasing requirements, the Commission would be directed to avoid disruptions to programs and undertakings to which the Online Streaming Act does not apply.
Redefine Canadian programs
The Commission would be directed to examine how it defines Canadian programs, in both the audio and audio-visual sectors. This would include consulting with Canadians, members of the creative and production sectors and other interested parties. Given significant public interest and the foundational nature of these definitions to the regulatory regime, the Commission would be directed to prioritize its examination of these definitions.
The Commission would be directed to ensure that the definition of “Canadian programs” is multifaceted, and that it interacts with evolving Canadian content policies. Finally, in its examination, the Commission would be directed to recognize the crucial roles played by Canadian independent producers and production companies, and the crucial relevance of Canadian creative personnel that have a high degree of creative control or visibility — such as actors, writers, directors, and showrunners — being used by both Canadian and foreign broadcasting undertakings.
Create an equitable, flexible and adaptable regulatory framework
The Commission would be directed to ensure any financial or non-financial requirements imposed on broadcasting undertakings are equitable relative to their size and nature, and would ensure comparable foreign and Canadian undertakings are treated equitably. The Commission would be directed to consider the diversity and nature of business models in the sector, such as the differences between broadcasting via linear, on-demand and social media services.
To establish a flexible and adaptable regulatory framework, the Commission would be directed to consider a number of factors including digital tools and solutions, as well as incentive and outcome-based tools, to minimize regulatory burden, avoid unintended impacts on technological innovation, promote competition, and achieve cultural objectives. In a further effort to minimize burden and maximize effectiveness in the regulation of digital platforms and services, the Commission would be directed to consider where it can coordinate with other regulatory bodies.
The BTLR Panel’s consultation process, which launched in September 2018 and closed in January 2019, yielded over two thousand written submissions from stakeholders, including cable and satellite providers, independent broadcasters, producers, creators, online broadcasting undertakings, public broadcasters, government agencies, Indigenous organizations, advocacy groups for persons with disabilities, and consumers. The BTLR Panel had in-person meetings with experts, creators, stakeholders, and other interested parties, including First Nations, Inuit and Métis broadcasters, and OLMCs, in Vancouver, Calgary, Whitehorse, Yellowknife, Iqaluit, Winnipeg, Toronto, Montréal, Halifax, and St. John’s. The results of these consultations were made public and considered in the development of the proposed policy directions. Since the BTLR engagement process, departmental officials have continued to meet with many stakeholders in the context of broadcasting modernization. In addition, departmental officials have met with a variety of stakeholders and have heard about many of the issues raised by these players in the context of the legislative review.
Provinces and territories have highlighted the urgent need to take action to modernize Canada’s broadcasting system to ensure an equitable playing field for all Canadian broadcasters, creators, and producers. The Minister of Canadian Heritage will engage with provinces and territories on the proposed directions and as the Commission implements the Online Streaming Act to share information and have discussions about modernizing Canada’s broadcasting system.
As required under the Act, the Minister of Canadian Heritage has consulted with the Commission on the proposed policy directions. The Commission reviewed the draft policy directions and provided its perspective as the entity responsible for implementing the directions, and where appropriate, provided feedback based on its broadcasting expertise. This feedback was incorporated as appropriate into the proposed directions that are currently posted for public comment.
Modern treaty obligations and Indigenous engagement and consultation
As required by the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an assessment of modern treaty implications was conducted.
The initial assessment of modern treaty implications examined the geographical scope and subject matter of the initiative and identified a duty to consult Nunavut Tunngavik Incorporated (NTI). NTI is the rights holder under the Nunavut Land Claims Agreement (NLCA). Article 32 of the NCLA ensures that Inuit can participate in the development of social and cultural policies, and in the design of social and cultural programs and services, including their method of delivery, within the Nunavut Settlement Area.
The Department held four engagement sessions at the end of January 2020 with First Nations, Inuit and Métis creators, producers and broadcasters. Participants advised on how the Government of Canada could make progress on issues such as access to resources, representation on decision-making boards, and funding available to protect and promote First Nations, Inuit and Métis languages and culture in broadcasting.
The Department will continue to engage with First Nations, Inuit and Métis peoples to reduce further barriers to participating in the broadcasting system in Canada. It will also monitor ongoing negotiations of modern treaties and self-government agreements, the Recognition of Indigenous Rights and Self-Determination discussion tables, and treaty implications, and will address any implications or obligations that are identified.
The Minister of Canadian Heritage introduced in Parliament Bill C-11, the Online Streaming Act, on February 2, 2022. Section 7 of the Act gives the Governor in Council the ability to give directions of general application on broad policy matters with respect to the broadcasting policy and regulatory policy objectives set out in the Act. The Government considers that complementary policy directions are the appropriate instrument to direct the Commission’s implementation of the new regulatory framework while also communicating the Government’s intentions to the public and stakeholders. Other Governor in Council tools in the Act, such as section 15 reports or section 28 powers, have a scope that makes them inconsistent with the Government’s intent to issue high-level directions to the Commission relating to the implementation of the Online Streaming Act. Instruments outside of the Act would not pertain to the objectives of the Government in the broadcasting system. While the Government will continue to rely on a broader evolving network of federal financial mechanisms to support Canadian audio and audio-visual content, such mechanisms run parallel to the regulatory regime and would not be a substitute for the proposed directions.
Benefits and costs
Cost-benefit analysis measures impacts as incremental differences between forecasted outcomes without the proposal (baseline scenario) versus with it (regulatory scenario). This allows a focus on results that are directly attributable to the proposal versus unrelated ones. Costs of the proposal include both incremental resources committed to achieving the desired outcome and the opportunity cost of alternative uses of those resources.
In the absence of the proposed policy directions, the Commission would commit resources to adapting regulations to the evolving media landscape. It would also need to commit resources to determining how to proceed. The manner and focus of this would be less certain and open to greater scope and less accountability.
In this scenario, the Commission would use a comparable level of resources as in the baseline to proceed with its regulatory agenda. Actions would be taken with consideration for the policy directions and in such a way as to demonstrate accountability. Fewer resources would be required for the Commission to determine how to proceed, while some approaches that otherwise would have been explored may be incompatible with the proposed policy directions, and thus rejected.
The proposed policy directions may result in low incremental costs to the Commission, which are expected to be less than $1 million annually and could be absorbed within existing resources.
The proposed policy directions would bind the Commission on general matters of broad application to its decisions. By directing the Commission’s priorities, the proposed directions would clarify for both the Commission and the public certain ways in which the Commission must use its resources. In multiple instances, the proposed directions would instruct the Commission to take specific actions. These actions would relate to areas where the Commission would have had to take some kind of action regardless of the proposed directions. However, in being instructed to undertake specific actions, the Commission’s flexibility to pursue other avenues that might have been more or less costly would be reduced.
In providing specific areas of focus for the Commission, developed in response to consultation, engagement, and research, the proposed directions would provide a clear path forward and save the time, money, and resources required in making incremental change over a long period of time. The proposed directions would impact the Commission by guiding how it conducts its regulatory functions, but would not directly result in any regulatory burden or costs for businesses or consumers.
Benefits would result from the Commission’s actions taken after the proposed directions come into force, setting the stage for anticipated benefits, including those that follow.
Support for Canadian broadcasters and the broadcasting environment
Canadian broadcasters are expected to benefit from a new regulatory system in which they and their competitors are regulated equitably. Clear requirements for expenditures on Canadian programs and outcome-based regulations would benefit both the production and distribution ends of the broadcasting value chain. Similarly, supports for community broadcasters would encourage a healthy and dynamic broadcasting environment. These broadcasters can reflect diverse communities and serve needs that are otherwise underserved, including through greater community participation in their operation and programming.
Support for Indigenous peoples
The Online Streaming Act addresses previous gaps in the Act that did not adequately support Indigenous broadcasters and creators. The proposed policy directions would further elaborate on the importance of support, regulation, and engagement that are aimed to further reconciliation and help address the repercussions of historical injustices and colonial legacies that have contributed to an underrepresentation of Indigenous stories and Indigenous-owned broadcasting undertakings in Canada’s broadcasting landscape.
Support for equity-seeking groups
Black and other racialized communities, and other equity-seeking groups, would benefit from the outcomes of requirements and engagements that are specifically focused on tools, targets, and methodologies to bring more programming that they create and produce to Canadian audiences. Canadian audiences would benefit from ready access to a greater, more representative variety of storytelling.
Support for Canadian programs and creators
The Department estimates that if the Commission implements similar regulatory requirements for online broadcasters as those in place for currently regulated broadcasters following the Online Streaming Act, the potential contributions by online broadcasters will have a significant impact for Canadian content and creators.
Ecosystem support would benefit social media creators, who create audio and audio-visual content for broadcasting undertakings and whose talent and business development benefit the Canadian broadcasting and creative sectors. In general, these efforts would help all Canadian creators better understand and adapt to changing opportunities in the context of online streaming, with the aim of encouraging fair remuneration and economic arrangements.
Canadian programs and creators will ultimately benefit from broadcasting undertakings being encouraged to consider and implement a wide range of discoverability methods, including advertising and marketing both on and off the service; or offering search, filters, categories, playlists, or other tools that enable users to find a diverse range of Canadian programs.
Opportunities for businesses
Ultimately, small and medium-sized Canadian businesses would benefit from the following:
- A flexible and adaptable regulatory framework that minimizes the regulatory burden and promotes competition and innovation where possible;
- A stronger domestic independent production sector for audio and audio-visual content, led by entrepreneurs and small and medium-sized businesses; and
- A stronger broadcasting sector with more sustainable independent broadcasting and programming undertakings, including those run by communities and non-profits.
Small business lens
Analysis under the small business lens concluded that the proposed policy directions would not directly impact Canadian small businesses. However, the proposed directions would instruct the Commission to consider certain factors and policy goals while it designs and implements a new regulatory framework with the active participation of all interested parties, including small and medium-sized businesses and the organizations that represent them.
The specific direction to exclude video games and the programs of social media creators from regulation and increase funds available for initiatives benefitting the overall creator ecosystem, including creators and businesses of all sizes, would provide the potential for beneficial outcomes. However, the overall level of costs and benefits to small businesses would depend on the Commission’s specific regulations.
The one-for-one rule does not apply as there is no direct impact on businesses. The proposed directions are instructive in nature and would guide the Commission in implementing a new regulatory framework. The level of administrative burden on businesses would depend on the Commission’s specific regulations.
Regulatory cooperation and alignment
The proposal is not related to a work plan or commitment under a formal regulatory cooperation forum. The proposal itself would not directly create new regulations applying to broadcasters. Rather, it would issue directions to the Commission, which, as an independent regulator, would develop and issue further regulations. This type of relationship between the regulator and Cabinet is specific to the federal legislative and machinery context of Canada; therefore, alignment of this specific instrument to other jurisdictions is not directly applicable. However, given that the proposed directions give guidance to the Commission regarding the application of a broader regulatory regime to online broadcasters, analysis on how Canada’s general approach to broadcasting regulation compares to that of other jurisdictions is still relevant.
Linkages to international agreements
The proposal would bolster Canada’s commitments as a signatory to the UNESCO 2005 Convention on the Protection and Promotion of the Diversity of Cultural Expressions, the 2017 Digital Guidelines on the Implementation on the 2005 Convention, and as the lead of the international multi-stakeholder working group that has developed the International Guiding Principles for Diversity of Content Online. The 2005 Convention recognizes the dual nature, both cultural and economic, of contemporary cultural expressions produced by artists and cultural professionals, including in the digital environment.
The Guiding Principles emphasize the importance of creation, access and discoverability of diverse content online; fair remuneration and economic viability of content creators; promotion of diverse, pluralistic sources of news and information as well as resilience against disinformation and misinformation; and transparency of the impacts of algorithmic treatments of online content.
Comparisons with other jurisdictions
There are relevant international examples of cultural policies responding to the digital era of audio and audio-visual content. Regulatory difference is important in this case to achieve Canada’s broadcasting policy objectives, but the Commission does ensure regulatory coordination with other jurisdictions in its overall operations.
In 2018, the European Union enacted amendments to the Audiovisual Media Services Directive (AVMSD). The Department met with EU counterparts to discuss similar priorities and challenges as they progressed towards adapting their own domestic regulatory frameworks to advance cultural objectives. The updated AVMSD includes requirements for global online broadcasting services to promote and distribute European works, with specific guidelines on the percentages of catalogues to be European works and how these services will additionally feature those works on their platforms.
Whereas the AVSMD leaves open the possibility for individual member states to impose financial contributions on media service providers, a key regulatory discrepancy with the proposed directions would be the instruction for the Commission to ensure online undertakings are required to contribute to Canadian programming and Canadian creators. Requiring such contributions would bring online undertakings into a contribution framework similar to the existing Canadian content contribution obligations. The proposed directions would also instruct the Commission to consider a wide range of methods for supporting discoverability, promotion and showcasing content that maintain or increase consumer choice, rather than recommending the AVSMD approach of creating specific quotas on content catalogues. By contrast, the Canadian approach would rely further on the incentive for online undertakings to make available Canadian content to recoup the investments they make under a new contribution framework.
The EU and the North American contexts present different challenges. Differences in regulation between Canada and the EU are necessary to respond to different local needs and priorities, industry contexts, jurisdictional requirements, constitutional frameworks, and histories of broadcasting regulation. In developing its regulations, the Commission will consider pertinent international examples alongside uniquely Canadian considerations such as the distinct place of Indigenous peoples in Canada, dual official languages, and proximity to the dominant cultural force of the United States among other characteristics that are predominant in the Canadian broadcasting system.
Strategic environmental assessment
In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus
No gender-based analysis plus impacts have been identified for this proposal. The proposed directions would not have a direct impact on Canadian populations, as they are anticipated to only have behavioural consequences for the Commission. The proposed directions would provide the Commission with guidance regarding how to implement the changes to the Act and how to use its new regulatory tools.
Overall, it is expected that all Canadians would benefit from the Commission’s actions following the issuance of the proposed directions. However, the impact would vary across populations. Notably, the Commission’s actions will likely lead to positive impacts for First Nations, Inuit and Métis people, members of Black and other racialized communities, members of other equity-seeking groups, and members of OLMCs.
Implementation, compliance and enforcement, and service standards
The proposed policy directions would come into force on the day on which they are registered and would bind the Commission in respect of matters pending before it on that day. The proposed directions, however, would not apply with respect to a licensing matter pending before the Commission if at the time the directions come into force, one year or less has passed since the date for filing interventions ended.
Following the coming into force of the policy directions, the Commission would convene open, public and evidence-based dialogue through which all interested parties can help to shape the new regulatory framework. The Commission would begin implementing the proposed directions immediately, with all components to be implemented within two years.
Compliance and enforcement
The Commission is bound to exercise its powers and perform its duties under the Act in accordance with the terms of any order made under section 7 of the Act. Commission licensing decisions can also be reviewed by the Governor in Council on the basis of a petition in writing presented to them, or on their own motion.
Digital and Creative Marketplace Frameworks
Department of Canadian Heritage
25 Eddy Street
PROPOSED REGULATORY TEXT
Notice is given, under paragraph 8(1)(a) of the Broadcasting Act footnote a, that the Governor in Council proposes to make the annexed Order Issuing Directions to the CRTC (Sustainable and Equitable Broadcasting Regulatory Framework) under subsection 7(1) of that Act.
Interested persons may make representations, which are to be published under paragraph 8(2)(b)footnote b of that Act, concerning the proposed Order within 45 days after the date of publication of this notice. They are strongly encouraged to use the online commenting feature that is available on the Canada Gazette website but if they use email, mail or any other means, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to Marketplace and Legislative Policy, Department of Canadian Heritage, 25 Eddy Street, Gatineau, Quebec J8X 4B5 (email: email@example.com).
Ottawa, June 2, 2023
Assistant Clerk of the Privy Council
Order Issuing Directions to the CRTC (Sustainable and Equitable Broadcasting Regulatory Framework)
1 The following definitions apply in this Order.
- means the Broadcasting Act. (Loi)
- social media creator
- means a person who creates programs that are primarily intended for online distribution as user-uploaded programs through social media services. (créateur pour les médias sociaux)
Diversity among Indigenous peoples
2 In applying this Order, the Commission is directed to consider the diversity among Indigenous peoples.
Meaningful participation of Indigenous persons
3 In furtherance of the objectives of the United Nations Declaration on the Rights of Indigenous Peoples, the Commission is directed to support the meaningful participation of Indigenous persons in the broadcasting system, including by supporting
- (a) their ability to create a wide range of programs;
- (b) access to those programs; and
- (c) their ownership and control of broadcasting undertakings.
Supporting Canadian programming
4 The Commission is directed to impose requirements on broadcasting undertakings that ensure that the Canadian broadcasting system — which is to be effectively owned and controlled by Canadians and includes foreign broadcasting undertakings that provide programming to Canadians — strongly supports a wide range of Canadian programming and Canadian creators. The requirements, both financial and non-financial, must be equitable given the size and nature of the undertaking and equitable as between foreign online undertakings and Canadian broadcasting undertakings.
Community broadcasters and broadcasters of exceptional importance
5 The Commission is directed to consider how to encourage innovation by, and support the sustainability of, community broadcasters and broadcasting undertakings that are of exceptional importance to the achievement of the objectives of the broadcasting policy set out in subsection 3(1) of the Act.
Discoverability and showcasing
6 The Commission is directed to consider both established and emerging means of discoverability and showcasing to promote a wide range of Canadian programming. In making regulations or imposing conditions in respect of discoverability and showcasing requirements, the Commission is directed to prioritize outcome-based regulations and conditions that minimize the need for broadcasting undertakings to make changes to their computer algorithms that impact the presentation of programs.
7 The Commission is directed to regulate and supervise the Canadian broadcasting system with a view to supporting the provision of programming that is accessible without barriers to persons with disabilities.
Flexible and adaptable regulatory framework
8 To support flexibility and adaptability in its regulatory framework, the Commission is directed to
- (a) minimize the regulatory burden on the Canadian broadcasting system;
- (b) avoid disruptions to programs and undertakings to which the Act does not apply;
- (c) respect audience choice and, where possible, increase the options available;
- (d) where appropriate, use tools that are based on incentives and outcomes;
- (e) where appropriate, use digital tools and solutions; and
- (f) consider other Canadian or foreign regulatory regimes that affect online undertakings.
Use of Canadian human resources
9 In its regulation of the broadcasting sector, the Commission is directed to ensure that the sector maximizes the use of Canadian creative and other human resources in the creation, production and presentation of programming in the Canadian broadcasting system, taking into account the effects of broadcasting undertakings, including online undertakings, on economic opportunities and remuneration for creators.
Social media creators and video games
10 The Commission is directed not to impose regulatory requirements on
- (a) online undertakings in respect of the programs of social media creators, including podcasts; and
- (b) broadcasting undertakings in respect of the transmission of video games.
Regulations — section 4.2 of the Act
11 In exercising its powers under section 4.2 of the Act, the Commission is directed to set out clear, objective and readily ascertainable criteria, including criteria that ensure that the Act only applies in respect of programs that have been broadcast, in whole or in significant part, by a broadcasting undertaking that is required to be carried on under a licence or that is required to be registered with the Commission but does not provide a social media service.
Regulations and orders — section 11.1 of the Act
12 In exercising its powers under section 11.1 of the Act, the Commission is directed to
- (a) regularly review expenditure requirements to ensure that they are proportional to their objectives and that those objectives are clear;
- (b) recognize the diversity of services provided by broadcasting undertakings;
- (c) consider providing flexibility for all broadcasting undertakings in meeting expenditure requirements;
- (d) consider demographic data — including data concerning the participation of Black and other racialized persons in the Canadian broadcasting system — collected from various sources, including broadcasting undertakings, industry organizations and information published under the Employment Equity Act;
- (e) where appropriate for a given business model and set of objectives, prioritize the imposition of requirements to make expenditures directly on the creation, production and presentation of Canadian programming;
- (f) ensure that expenditure requirements support the creation and availability of programming
- (i) by Indigenous creators and broadcasting undertakings, including programming distributed by Indigenous broadcasting undertakings and programming in Indigenous languages, taking into consideration the importance of reconciliation with Indigenous peoples and the challenges and obstacles that they face, including those stemming from historical injustices or the legacies of colonialism,
- (ii) by creators from Black and other racialized communities and other equity-seeking groups, taking into consideration the challenges and obstacles that they face, including systemic racism and the obstacles faced by those whose first language is not an official language, and
- (iii) in both official languages, including programming by creators from official language minority communities, taking into consideration the minority context of French in Canada and North America, the specific challenges involved with creating and making available original French-language programming and the challenges and obstacles faced by those creators;
- (g) consider the need for sustainable and predictable funding to support participation by persons, groups of persons or organizations representing the public interest in proceedings before the Commission under the Act;
- (h) support broadcasting undertakings that offer programming services that are of exceptional importance to the achievement of the broadcasting policy set out in subsection 3(1) of the Act;
- (i) consider the importance of sustainable support by the entire Canadian broadcasting system for news and current events programming, including a broad range of original local and regional news and community programming; and
- (j) support activities and services — including training and development activities, conferences, the activities of organizations that represent creators and the development of digital and open-source tools and solutions — that support Canadian creators of audio or audio-visual programs for broadcasting by broadcasting undertakings, including social media creators.
Determination of Canadian programming
13 In its determination of what constitutes Canadian programming, the Commission is directed to
- (a) consult Canadians, the creative and production sectors and other interested parties;
- (b) support Canadians holding a broad range of key creative positions, in particular those with a high degree of creative control or visibility;
- (c) support Canadian ownership of intellectual property;
- (d) recognize the distinctions between broadcasting undertakings that distribute audio programs and those that distribute audio-visual programming;
- (e) recognize that the Act applies to foreign broadcasting undertakings;
- (f) consider, as it relates to audio-visual programming, the vital role of Canadian independent producers and of the Canadian creative resources that are being used by both Canadian and foreign broadcasting undertakings; and
- (g) consider whether its determination of what constitutes a Canadian program complements other Canadian content policies that are applicable to the Canadian broadcasting system, including those pertaining to audio-visual tax credits or government funding.
14 In its regulation of the broadcasting sector, the Commission is directed to engage with Indigenous peoples and Indigenous partners, governing bodies, broadcasters, creators, producers, industry organizations and community members and, in doing so, collaborate with relevant federal departments where possible to solicit comments on, among other things,
- (a) how to best support Indigenous broadcasting undertakings to help ensure the viability of the Indigenous broadcasting sector;
- (b) the use of regulatory conditions that foster the success of business models that provide and reflect Indigenous perspectives;
- (c) how to support the discoverability of programs by Indigenous creators;
- (d) the most appropriate tools, including funding mechanisms, for supporting Indigenous storytelling and production as well as Indigenous-led organizations that could manage and be responsible for that support; and
- (e) the measures that are necessary to ensure its regulatory approach is in furtherance of the objectives of the United Nations Declaration on the Rights of Indigenous Peoples and supports narrative sovereignty in the Canadian broadcasting system.
15 In its regulation of the broadcasting sector, the Commission is directed to engage with Black and other racialized communities and other equity-seeking groups to solicit comments regarding
- (a) the most appropriate tools, including funding mechanisms, to support those communities and groups; and
- (b) the development of a framework of measurable targets to support the creation, availability and discoverability of programming made by members of those communities and groups.
Official language minority communties
16 The Commission is directed to engage with official language minority communities to solicit comments regarding the creation of and access to programming by and for those communities, including with respect to funding, distribution and discoverability.
17 The Commission is directed to consider how to make the participation in the engagements referred to in sections 14 to 16 as accessible as possible.
Information and Implementation
Information — policy objectives
18 The Commission is directed to provide information to the public on a periodic basis regarding the progress made in achieving the objectives of the broadcasting policy set in subsection 3(1) of the Act, including progress on the inclusion and participation of members of equity-seeking groups in the Canadian broadcasting system.
19 The Commission is directed to make changes to its regulatory framework that are necessary for the purposes of the implementation of this Order within two years after the day on which it comes into force. In doing so, the Commission is directed to prioritize the implementation of sections 13 to 16 and to ensure that changes to its regulatory framework are made as soon as feasible and on a continual basis during that two-year period.
Coming into Force
20 This Order comes into force on the day on which it is registered.
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