Dockets: A-472-16
A-471-16
Citation:
2017 FCA 249
CORAM:
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WEBB J.A.
NEAR J.A.
GLEASON J.A.
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Docket:A-472-16
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BETWEEN:
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BELL CANADA and
BELL MEDIA INC.
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Appellants
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and
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ATTORNEY
GENERAL OF CANADA
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Respondents
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and
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ASSOCIATION
OF CANADIAN ADVERTISERS and ALLIANCE OF CANADIAN CINEMA. TELEVISION AND RADIO
ARTISTS
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Interveners
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Docket:A-471-16
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AND BETWEEN:
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NATIONAL
FOOTBALL LEAGUE, NFL INTERNATIONAL LLC and NFL PRODUCTIONS LLC
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Appellants
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And
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ATTORNEY
GENERAL OF CANADA
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Respondents
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And
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ASSOCIATION
OF CANADIAN ADVERTISERS and ALLIANCE OF CANADIAN CINEMA. TELEVISION AND RADIO
ARTISTS
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Interveners
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REASONS
FOR JUDGMENT
NEAR J.A.
I.
Overview
[1]
This is a consolidation of two statutory appeals
under subsection 31(2) of the Broadcasting Act, S.C. 1991, c. 11. The
appellants, Bell Canada and Bell Media Inc. (Bell) and the National Football
League, NFL International LLC, and NFL Productions LLC (NFL), appeal an order
of the Canadian Radio-television and Telecommunications Commission (CRTC) by
which the CRTC excluded the Super Bowl from the simultaneous substitution
regime (Broadcasting Regulatory Policy CRTC 2016-334 (Final Decision) and
Broadcasting Order CRTC 2016-335 (Final Order)).
[2]
The appeals A-472-16 and A-471-16 were
consolidated in an order dated January 12, 2017 with A-472-16 designated as the
lead appeal. Accordingly, the following reasons will be filed in the lead file
and a copy will be filed as Reasons for Judgment in file number A-471-16.
II.
Background
[3]
The appellant, the NFL, is the copyright holder
for the television production of the Super Bowl, the annual championship game
of the NFL. The NFL has an agreement with the other appellant, Bell, granting
Bell the exclusive rights to broadcast the Super Bowl in Canada. The Super Bowl
was the most watched single event on television in Canada in 2015.
[4]
For more than 40 years, the Super Bowl has been broadcast
subject to Canada’s simultaneous substitution regime. Regulations promulgated
under the Broadcasting Act provide that Canadian broadcasters shall not
delete or alter signals when retransmitting programming services originating
outside of Canada unless granted permission under the simultaneous substitution
regime (Broadcasting Distribution Regulations, S.O.R./97-555, s. 7(a)). Under
the simultaneous substitution regime, unless the CRTC determines otherwise, the
operator of a Canadian television station may require a Canadian broadcasting
distribution undertaking to substitute the Canadian feed for a non-Canadian
programming service, which results in Canadian commercials being substituted for
those of an American broadcaster so that Canadian viewers watching an American
channel will see Canadian commercials. The Canadian broadcaster of the Super
Bowl made such simultaneous substitution requests for many years and so, up
until the Order that is the subject of this judicial review, the Super Bowl was
broadcast in Canada with Canadian commercials on both Canadian and American
channels.
[5]
On October 24, 2013, the CRTC launched a public
consultation called “Let’s Talk TV: A conversation with
Canadians about the future of television” (Broadcasting Notice of
Invitation CRTC 2013-563). This was followed by a series of consultations
throughout which some Canadians complained about not being able to watch the
American commercials during the Super Bowl (Final Decision at para. 5). These
consultations culminated in the Final Decision and the Final Order under
appeal.
III.
Decision of the CRTC
[6]
On August 19, 2016, the CRTC issued the Final
Order “through which simultaneous substitution will no
longer be authorized for the Super Bowl, effective 1 January 2017”
(Final Decision at para. 69). It explained that it made this decision because
simultaneous substitution for the Super Bowl is not in the public interest
(Final Decision at para. 46). Effectively, as of January 1, 2017, Canadians are
now able to watch the Super Bowl on Canadian stations with Canadian
advertisements or on American stations with American advertisements.
[7]
In its reasons, the CRTC considered five legal
issues raised by the parties: (1) the CRTC’s jurisdiction to issue the Final
order; (2) whether administrative law discrimination (the principle that an
administrative tribunal is not permitted to make its rules applicable to
different persons based on a distinction not explicitly authorized by its
legislation) has been applied; (3) the targeting of a specific program; (4) the
retrospective application of a regulatory regime, and vested rights; and (5)
copyright and international trade (Final Decision at para. 44). I will discuss
the CRTC’s determination on each of the issues under appeal in my analysis.
IV.
Issues
[8]
I would characterize the issues on appeal as
follows:
- Was it
reasonable for the CRTC to determine that its Final Order—made pursuant to
paragraph 9(1)(h) of the Broadcasting Act—was within its jurisdiction?
- Was it
reasonable for the CRTC to determine that its Final Order is not
retrospective and does not interfere with vested rights?
- Was it correct
for the CRTC to determine that its Final Order does not conflict with the Copyright
Act, R.S.C., 1985, c. C-42 and/or international trade law?
V.
Analysis
A.
Jurisdiction of the CRTC
(1)
Standard of Review
[9]
The standard of review is reasonableness where
an administrative decision-maker interprets its home statutes or statutes
closely related to its functions and this “extends to
the delineation of its own jurisdiction in applying its home statutes” (Bell
Canada v. Canada (Attorney General), 2016 FCA 217 at para. 42, 402 D.L.R. (4th)
551 (Bell Canada); Bell Canada v. Amtelecom Limited Partnership,
2015 FCA 126 at paras. 37–39, [2016] 1 F.C.R. 29 (Amtelecom); 2251723
Ontario Inc. (VMedia) v. Rogers Media Inc., 2017 FCA 186 at para. 29, 414
D.L.R. (4th) 750 (VMedia)). In my view, the standard of review for this
issue is reasonableness. The appellants strenuously argue for a limited margin
of appreciation and a narrow view as to what would be reasonable which, in my
view, is an analysis of limited assistance. The determination to be made is
whether the decision is reasonable under the circumstances; nothing more and
nothing less (Zulkoskey v. Canada (Employment and Social Development),
2016 FCA 268 at para. 15, 2016 C.L.L.C. 230-010 citing Wilson v. Atomic
Energy of Canada Ltd., 2016 SCC 29 at paras. 18, 73, [2016] 1 S.C.R. 770).
Thus, the principles in Dunsmuir v. New Brunswick, 2008 SCC 9 at para.
47, [2008] 1 S.C.R. 190 apply. As long as the CRTC’s decision demonstrates “justification, transparency and intelligibility within the
decision making process” and “falls within a
range of possible, acceptable outcomes which are defensible in respect of the
facts and law”, the Court will treat it with deference.
(2)
Was it reasonable for the CRTC to determine that
its Final Order—made pursuant to paragraph 9(1)(h) of the Broadcasting
Act—was within its jurisdiction?
[10]
It is important to understand the interplay
between the Broadcasting Act and its regulations with respect to
simultaneous substitution for the purposes of this appeal. The CRTC issued its
Final Order pursuant to paragraph 9(1)(h) of the Broadcasting Act.
Paragraph 9(1)(h) reads:
9 (1) Subject to
this Part, the Commission may, in furtherance of its objects,
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9 (1) Sous réserve des autres dispositions de la présente partie,
le Conseil peut, dans l’exécution de sa mission :
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…
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[…]
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(h)
require any licensee who is authorized to carry on a distribution undertaking
to carry, on such terms and conditions as the Commission deems appropriate,
programming services specified by the Commission.
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h) obliger ces titulaires à offrir certains
services de programmation selon les modalités qu’il précise.
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[11]
Further, subsection 4(1) of the Simultaneous Programming
Service Deletion and Substitution Regulations, S.O.R./2015-240 (Sim Sub
Regulations) outlines the circumstances in which simultaneous substitution is
required:
4 (1) Except as
otherwise provided under these Regulations or in a condition of its licence,
a licensee that receives a request referred to in section 3 must carry out
the requested deletion and substitution if the following conditions are met:
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4 (1) Sous réserve du présent règlement ou des conditions de sa
licence, le titulaire qui reçoit la demande visée à l’article 3 doit retirer
le service de programmation en cause et effectuer la substitution demandée si
les conditions suivantes sont réunies :
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(a) the
request is in writing and is received by the licensee at least four days
before the day on which the programming service to be substituted is to be
broadcast;
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a) la
demande est présentée par écrit et doit être reçue par le titulaire au moins
quatre jours avant la date prévue pour la diffusion du service de
programmation à substituer;
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(b) the
programming service to be deleted and the programming service to be
substituted are comparable and are to be broadcast simultaneously;
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b) le
service de programmation à retirer et le service de programmation à
substituer sont comparables et doivent être diffusés simultanément;
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(c) the
programming service to be substituted has the same format as, or a higher format
than, the programming service to be deleted; and
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c) le
service de programmation à substituer est d’un format égal ou supérieur au
service de programmation à retirer;
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(d) if the
licensee carries on a terrestrial distribution undertaking, the programming
service to be substituted has a higher priority under section 17 of the Broadcasting
Distribution Regulations than the programming service to be deleted.
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d) dans le cas où le titulaire exploite une
entreprise de distribution terrestre, le service de programmation à
substituer a priorité, en vertu de l’article 17 du Règlement sur la
distribution de radiodiffusion, sur le service de programmation à
retirer.
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[12]
Then, subsection 4(3) of the Sim Sub Regulations
outlines an exception to the simultaneous substitution requirement in
subsection 4(1):
4 (3) A licensee
must not delete a programming service and substitute another programming
service for it if the Commission decides under subsection 18(3) of the Broadcasting
Act that the deletion and substitution are not in the public interest.
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(3) Le titulaire ne peut retirer un service de programmation et y
substituer un autre service de programmation si le Conseil rend une décision,
en vertu du paragraphe 18(3) de la Loi sur la radiodiffusion, portant
que le retrait et la substitution ne sont pas dans l’intérêt public.
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[emphasis added]
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[nos
soulignements]
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[13]
Finally, subsection 18(3) of the Broadcasting
Act reads:
18(3) The Commission may hold a public hearing, make a report,
issue any decision and give any approval in connection with any complaint or
representation made to the Commission or in connection with any other
matter within its jurisdiction under this Act if it is satisfied that it
would be in the public interest to do so.
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18(3) Les
plaintes et les observations présentées au Conseil, de même que toute
autre question relevant de sa compétence au titre de la présente loi,
font l’objet de telles audiences, d’un rapport et d’une décision —
notamment une approbation — si le Conseil l’estime dans l’intérêt public.
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[emphasis added]
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[nos
soulignements]
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[14]
The CRTC explained that its Final Order pursuant
to paragraph 9(1)(h) was within its jurisdiction at paragraphs 45–48 of
its Final Decision:
45. Section 4(1) of
the Simultaneous Deletion and Substitution Regulations sets out circumstances
in which a licensee is required to delete and substitute programming, with the
explicit provision that this obligation applies "except as otherwise
provided under these Regulations or in a condition of its licence."
Section 4(3) goes on to create such an exception, by stating that a licensee
"must not delete a programming service and substitute another programming
service for it if the Commission decides under subsection 18(3) of the Broadcasting
Act that the deletion and substitution are not in the public
interest."
46. In light of
the Commission's finding above, further to a proceeding initiated by
Broadcasting Notice of Consultation 2016-37, that deleting and performing
simultaneous substitution for the Super Bowl are not in the public interest,
the Commission finds that its decision in this regard falls within section 4(3)
of the Simultaneous Deletion and Substitution Regulations. Having made this
finding, pursuant to section 4(3), the Commission can use its power under
section 9(1)(h) of the Act to implement this decision without conflict with the
Simultaneous Deletion and Substitution Regulations. Accordingly, the Commission
is of the view that issuing the proposed distribution order is within its
jurisdiction.
47. In any event,
the Act provides for several overlapping powers of the Commission to impose
legally binding requirements, which include regulations, conditions of licence,
9(1)(h) orders and exemption orders. The legislative history indicates that
these different powers can be used by the Commission in a complementary manner.
The Commission has considered this issue in the past.
48. To interpret the
Act as permitting the issuance of a 9(1)(h) order only where a regulation does
not already exist could render the effect of 9(1)(h) orders virtually
meaningless. Moreover, if in making a regulation the Commission was prohibiting
itself from issuing a 9(1)(h) order in the future, such a regulation could be
viewed as fettering the Commission's discretion to exercise a complementary power.
Consequently, the Commission considers that BCE's argument is not convincing in
the present case.
[emphasis added,
citations omitted]
[15]
The appellants argue that because paragraph
9(1)(h) refers to “programming services”,
the CRTC only has jurisdiction to make orders and regulations regarding
programming services and does not have jurisdiction to single out an individual
“program”. The appellants equate the term
program with a single show. Subsection 2(1) of the Broadcasting Act
defines program as follows:
program means sounds or visual images, or a combination of sounds and
visual images, that are intended to inform, enlighten or entertain, but does
not include visual images, whether or not combined with sounds, that consist
predominantly of alphanumeric text; (émission)
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émission Les sons ou les images — ou leur
combinaison — destinés à informer ou divertir, à l’exception des images,
muettes ou non, consistant essentiellement en des lettres ou des chiffres. (program)
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Although the Broadcasting Act does not
define programming service, the appellants argue that the Act uses the term to
refer to an entire television channel and not individual shows (as it does in
paragraphs 3(1)(r) and 3(1)(t)). Thus, the appellants argue, the
Super Bowl is a program—which is different from a programming service—and so
the CRTC did not have jurisdiction to make its Final Order under paragraph
9(1)(h).
[16]
In support of their argument, the appellants
cite Broadcasting Decision CRTC 2005-195 (Star Choice), however, as the
respondent notes, the appellants cite only part of this authority. In that
decision, the CRTC explained that the meaning of the term programming service
depends on the context in which it is used:
28. …the Commission notes that section
33(2) of the Interpretation Act states that, in any statute or
regulation, “Words in the singular include the plural, and words in the plural
include the singular.” Accordingly, the Commission considers that “programming
service,” depending upon the context in which it is used, may be taken to
include all programs, i.e., the entire output transmitted by the operator
of a programming undertaking for reception by the public.
[emphasis added]
[17]
In my view, the CRTC’s explanation that “the Commission considers the ‘programming service’, depending
upon the context in which it is used, may be taken to include all programs”
necessarily means that, in other circumstances, the same term may be taken to
include a single program. It is also instructive and informs the context that
the definition of programming services in subsection 1(2) of the Sim Sub
Regulations (which adopts the definition in section 1 of the Broadcasting
Distribution Regulations) defines programming service to include a program.
Section 1 of the Broadcasting Distribution Regulations defines
programming service as follows:
programming service means a
program that is provided by a programming undertaking. (service de
programmation)
[emphasis added]
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service de programmation Émission fournie par une
entreprise de programmation.(programming service)
[nos
soulignements]
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[18]
The appellants also argue that the legislative
history of paragraph 9(1)(h) of the Broadcasting Act and previous
decisions of this Court indicate that the term programming service does not
include programs. In my view, the use of the term programming service to refer
to channels in some circumstances does not preclude the term from also
including a program. Although the legislative history demonstrates that the
term programming service was used to refer to channels in parliamentary debates,
the appellants do not demonstrate that the legislator intended to exclude programs
from its meaning. Further, legislative history, on its own, is not determinative.
Similarly, the fact that this Court has used the term programming service to
refer to channels does not mean that the term cannot also be used to refer to programs.
The appellants do not demonstrate that either the legislator or this Court has
excluded programs from the meaning of programming service.
[19]
It seems reasonable to determine that, in some
contexts, the term programming services in paragraph 9(1)(h) includes a
program given that the Sim Sub Regulations (by adopting the definition of
programming service in the Broadcasting Distribution Regulations)
provide for such an interpretation where substitution is to be prohibited. In
my view, it is reasonable to conclude that a program would be included where
terms and conditions are being added preventing the substitution of ads.
Further, the CRTC’s interpretation of programming services and program in Star
Choice seems to me to be a reasonable interpretation of the jurisdiction
granted to the CRTC in paragraph 9(1)(h) of the Broadcasting Act
and, in my view, there is no inconsistency between its finding in Star
Choice and this matter.
[20]
Having established that it is a reasonable
interpretation that programming services, for the purposes of paragraph 9(1)(h),
can include one or more programs, it is necessary to consider the other parts
of the paragraph that grant the CRTC broad powers to make orders outlining such
“terms and conditions as the Commission deems
appropriate” so long as they are “in furtherance
of its objects”.
[21]
The appellants argue that the Final Order is
inconsistent with the policy objectives of the Broadcasting Act because
it does not privilege Canadian content. I disagree.
[22]
The appellants argue that Canadian broadcasting
policy must privilege Canadian content, citing Reference re Broadcasting
Regulatory Policy CRTC 2010-167 and Broadcasting Order CRTC 2010-168, 2012
SCC 68 at para. 32, [2012] 3 S.C.R. 489 (Cogeco). Although the Supreme
Court of Canada has found that the Broadcasting Act “has a primarily cultural aim” (Cogeco at para.
32), this does not mean that promoting Canadian content is its sole objective.
Indeed, the objectives of the Broadcasting Act are extensive and varied.
Although the objectives set out in section 3 of the Broadcasting Act
(and mandated to the CRTC in subsection 5(1)) include supporting Canadian
content, (see e.g. paras. 3(d)(i), (e), and (t)(i)),
the Broadcasting Act also states that one of the Act’s objectives is
that “the programming provided by the Canadian
broadcasting system should be drawn from local, regional, national and international
sources” (subpara. 3(1)(i)(ii)).
[23]
In its Final Decision (paras. 21–24), the CRTC
explained that, although it generally promotes Canadian content in its
policies, in this circumstance, it does not believe that the simultaneous
substitution regime is in the public interest:
21. … While many of the policy objectives of
the Act focus on ensuring Canadian cultural enrichment and the promotion of
Canadian programming, they also include other objectives, such as ensuring that
Canadians have access to local, national and international programming. …
…
24. As noted in the Act, the Commission’s
duty is to regulate and supervise the broadcasting system as a whole (which
includes programming services, distribution services, and Canadian viewers) to
ensure the fulfilment of the policy objectives of the Act. The Commission
remains of the view that changes to the simultaneous substitution regime are
needed to ensure that the broadcasting system is balanced as a whole in a way
that fulfils the policy objectives of the Act. In addition to the making of the
Simultaneous Deletion and Substitution Regulations, this includes no longer
authorizing simultaneous substitution for the Super Bowl.
[24]
The appellants argue, and I agree, that there is
a certain irony that legislation that has the protection of the Canadian
broadcasting industry and its employees as one of its important objectives is
being used to allow for the broadcasting of American ads during the Super Bowl
to the apparent detriment of the Canadian industry and its employees. But there
are numerous disparate objectives set out in the Broadcasting Act and
Parliament intended that the CRTC decide how best to balance competing policy
objectives related to broadcasting in Canada. It is not for the Court to engage
in weighing these competing policy objectives and substituting its own view in
deciding which policy objectives should be pursued.
[25]
Having established that the CRTC’s determination
that it had jurisdiction to make the Final Order under paragraph 9(1)(h)
was reasonable, it follows that it had jurisdiction to make this order pursuant
to subsection 18(3) of the Broadcasting Act and subsection 4(3) of the Sim
Sub Regulations. Once the CRTC found that simultaneous substitution of the
Super Bowl is not in the public interest under subsection 18(3) of the Broadcasting
Act, it was entitled to exempt the Super Bowl from the simultaneous
substitution regime under subsection 4(3) of the Sim Sub Regulations. Neither
of the appellants argued that subsection 4(3) of the Sim Sub Regulations is ultra
vires.
[26]
The appellants further submit that the Final
Order conflicts with the applicable regulations and was therefore beyond the
jurisdiction of the CRTC. More specifically, they assert that the substantive
decision to exclude the Super Bowl from the simultaneous substitution regime was
not made in the Final Order but rather in the earlier Broadcasting Regulatory
Policy, CRTC-2015-25, issued by the CRTC on January 29, 2015. In January of
2015, the Sim Sub Regulations had not yet been promulgated by the CRTC. The
appellants say that the Sim Sub Regulations do not have retrospective effect
and that, under the regulations in place in January of 2015, the CRTC lacked
the jurisdiction to make the Final Order as it conflicted with the regulatory
provisions that then governed simultaneous substitution.
[27]
I disagree. The substantive decision of the CRTC
regarding the exclusion of the Super Bowl from the simultaneous substitution regime
was made in the Final Decision and Final Order and not in the January 2015
policy. Indeed this was determined by this Court in Bell Canada where
this Court held that the CRTC’s January 2015 policy was not a reviewable
decision and that the appellants’ judicial review application in respect of it
and related policies was therefore premature. Thus, the decision to exclude the
Super Bowl from the simultaneous substitution regime was made in the Final
Decision and Final Order and, as of the date they were rendered, the Sim Sub
Regulations were in force. As already noted, subsection 4(3) of the Sim Sub
Regulations provides for an exception to the simultaneous substitution regime
where the CRTC decides that the deletion and substitution is not in the public
interest under subsection 18(3) of the Broadcasting Act. Thus, the Final
Order does not conflict with the applicable regulations.
[28]
The CRTC is a specialized administrative
tribunal with expertise in the area of broadcasting. As such, it is owed
deference by this Court. This deference extends to interpretation of the Broadcasting
Act as one of its home statutes (Bell Canada at para. 42; Amtelecom
at paras. 37–39; VMedia at para. 29). The CRTC’s interpretation that
programming service in paragraph 9(1)(h) of the Broadcasting Act can
include programs is reasonable in that it is consistent with its previous
decision in Star Choice, the Sim Sub Regulations which adopt the
definition in the Broadcasting Distribution Regulations, and the policy
objectives set out in subsection 3(1) of the Broadcasting Act. Given the
deference owed to the CRTC in its interpretation of its home statutes and the
broad discretion conferred on the CRTC by paragraph 9(1)(h), the CRTC’s
explanation of its jurisdiction to make the Final Order is justifiable,
transparent, and intelligible and falls within the range of reasonable outcomes
defensible in respect of the facts and the law.
B.
Retrospective Application
(1)
Standard of Review
[29]
The appellant Bell, the respondent, and the
interveners all agree that the standard of review on the question of
retrospectivity is reasonableness as the CRTC interpreted a question within its
specialized expertise. I agree. As this Court explained in Amtelecom at
paragraphs 37 and 38 with regards to the CRTC and retrospectivity:
37 Even if one assumes that the
presumption against retrospective legislation is a law of general application,
that question calls for review on the correctness standard only if the question
is outside the tribunal’s specialized expertise. …
38 The notion of a tribunal’s
specialized expertise has evolved to include the exercise of “interpretive
discretion” so that the CRTC is presumed to have the required expertise to
resolve the question of whether section 24 authorizes it to promulgate a Code
with retrospective effect.
(2)
Was it reasonable for the CRTC to determine that
its Final Order is not retrospective and does not interfere with vested rights?
[30]
The appellant, Bell, argues that the Final Order
operates retrospectively and interferes with vested rights. It explains that
the Final Order has made it very difficult for Bell to sell Canadian
advertising and that this “will cause Bell Media to
lose the vast majority of the benefit of broadcasting the Super Bowl”.
[31]
The CRTC explained its position that its Final
Order does not interfere with vested rights at paragraph 56 of its Final
Decision:
56. The Commission is of the view that it
cannot be prevented from changing its regulatory regime, including its rules on
simultaneous substitution, simply because of an existing contractual situation
relating to broadcast rights. In the present case, although BCE may have
negotiated its agreement with the NFL based on assumptions about the amount of
revenue if can expect to receive from the subject broadcast rights, the
contract itself relates to the transaction between BCE and the NFL, not between
BCE and its advertisers. Although the Commission’s actions may affect the
parties’ assumptions underlying the contract, such actions do not affect –
either directly or retrospectively – a vested contractual right, given that no
one has a vested right in the continuance of a regulatory regime as it exists
at a given moment.
[emphasis added]
[32]
There are no guarantees that the law will not
change. Indeed, legislators often make legislation and regulations that
interfere with expectations. The CRTC’s powers to make orders and regulations
cannot be limited by a contract made between private parties. As the Supreme
Court of Canada explained in Gustavson Drilling (1964) v. Minister of
National Revenue, [1977] 1 S.C.R. 271 at 282–83, 66 D.L.R. (3d) 449:
… No one has a vested right to
continuance of the law as it stood in the past; in tax law it is imperative
that legislation conform to changing social needs and governmental policy. A
taxpayer may plan his financial affairs in reliance on the tax laws remaining
the same; he takes the risk that the legislation may be changed.
The mere right existing in the members
of the community or any class of them at the date of the repeal of a statute to
take advantage of the repealed statute is not a right accrued.
[emphasis added, citations omitted]
[33]
In this case, Bell’s argument that the CRTC
interfered with its vested right to be the exclusive broadcaster of the Super
Bowl in Canada fails. Bell argued that the NFL granted it the right to be the
exclusive Canadian broadcaster of the Super Bowl. Although it is the NFL’s right,
as a copyright holder, to licence its program to Bell, it is not the NFL’s
right that the program will be simultaneously substituted—this is a benefit
conferred by Canada’s broadcasting regulatory regime. Consequently, this could
not have been a term of the licence granted to Bell.
[34]
Canada’s broadcasting regime does not confer
rights but benefits. Bell only ever had the privilege to request simultaneous
substitution, a privilege which flows from the Broadcasting Act and
regulations. Even if Bell wanted to, it could never have guaranteed that it
would engage in simultaneous substitution. As the respondent argues: “[t]o the extent any company is contractually obligated to
perform simultaneous substitution, the company undertook to do so at its own
risk.” Bell only ever had the possibility to sell advertising space at a
later date and so lost only a speculative opportunity for profit that is not
sufficiently concrete to be considered vested.
[35]
This case is distinguishable from Amtelecom.
In that case, this Court found that a CRTC order limiting wireless services
providers’ contracts to two years—including existing contracts—interfered with
the wireless service providers’ vested rights in the payment of early
cancellation fees. The Court explained that this interfered with an existing
obligation: “[t]o the extent that the early
cancellation charge is the accelerated payment of a portion of that revenue
stream, it … is simply a different mode of payment of an existing obligation”
(Amtelecom at para. 21). In this case, however, there is no existing
obligation as there is no vested right because, unlike the cellular providers
in Amtelecom, Bell has no legal entitlement to a specific sum of revenue
from selling advertisements under its contract with the NFL. Its rights to
revenue are contingent on entering into subsequent contracts with advertisers
and are not vested by virtue of its contract with the NFL.
[36]
This private agreement under which no right to
simultaneously substitute commercials has vested cannot prevent the CRTC from
issuing an order. Further, the interpretation of contractual rights is a
question of mixed fact and law and is owed deference. I see no reviewable error
in the CRTC’s interpretation of one of its home statutes, the Broadcasting
Act, on the issue of retrospectivity.
C.
Copyright and International Trade
(1)
Standard of Review
[37]
The appellant, the NFL, argues that the standard
of review for the copyright issue is correctness. They argue that the CRTC’s
functions are those given to it in the Broadcasting Act and the Telecommunications
Act, S.C. 1993, c. 38 and that Parliament never delegated powers relating
to the Copyright Act to the CRTC.
[38]
I agree with the NFL that the applicable
standard of review is correctness. The Copyright Act is not a ‘home
statute’ of the CRTC and, in any case, it shares concurrent jurisdiction with
the Copyright Board and the courts at first instance (Rogers Communications
Inc. v. Society of Composers, Authors and Music Publishers of Canada, 2012
SCC 35 at para. 15, [2012] 2 S.C.R. 283).
(2)
Was it correct for the CRTC to determine that
its Final Order does not conflict with the Copyright Act and/or
international trade law?
[39]
The NFL argues that the Final Order conflicts
with the Copyright Act in both purpose and in operation.
[40]
The NFL’s argument is premised on several
provisions of the Copyright Act and the Canada-United States Free
Trade Agreement, 2 January 1988, Can. T.S. 1989 No. 3 (CUSFTA) that relate
to retransmission rights. First, paragraph 3(1)(f) of the Copyright
Act grants a copyright holder the exclusive right to produce or reproduce
copyrighted works, including retransmission rights:
3 (1) For the
purposes of this Act, copyright, in relation to a work, means
the sole right to produce or reproduce the work or any substantial part thereof
in any material form whatever, to perform the work or any substantial part
thereof in public or, if the work is unpublished, to publish the work or any
substantial part thereof, and includes the sole right
|
3 (1) Le droit d’auteur sur l’oeuvre comporte le droit exclusif de
produire ou reproduire la totalité ou une partie importante de l’oeuvre, sous
une forme matérielle quelconque, d’en exécuter ou d’en représenter la
totalité ou une partie importante en public et, si l’oeuvre n’est pas
publiée, d’en publier la totalité ou une partie importante; ce droit
comporte, en outre, le droit exclusif :
|
…
|
[…]
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(f) in the
case of any literary, dramatic, musical or artistic work, to communicate the
work to the public by telecommunication,
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f) de communiquer au public, par
télécommunication, une oeuvre littéraire, dramatique, musicale ou artistique;
|
[41]
Subsection 31(2) of the Coypright Act,
however, creates an exception to this exclusive right when a work is
retransmitted in accordance with the enumerated conditions. As long as a
broadcaster meets each of the enumerated conditions, it does not infringe
copyright:
31 (2) It is not an infringement of copyright for a retransmitter
to communicate to the public by telecommunication any literary, dramatic,
musical or artistic work if
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31 (2) Ne
constitue pas une violation du droit d’auteur le fait, pour le
retransmetteur, de communiquer une oeuvre au public par télécommunication si,
à la fois :
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(a) the communication is a retransmission of a local or
distant signal;
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a) la communication consiste en la
retransmission d’un signal local ou éloigné, selon le cas;
|
(b) the retransmission is lawful under the Broadcasting
Act;
|
b) la retransmission est licite en vertu de
la Loi sur la radiodiffusion;
|
(c) the signal is retransmitted simultaneously and without
alteration, except as otherwise required or permitted by or under the laws of
Canada;
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c) le signal est retransmis, sauf
obligation ou permission légale ou réglementaire, simultanément et sans
modification;
|
(d) in the case of the retransmission of a distant signal,
the retransmitter has paid any royalties, and complied with any terms and
conditions, fixed under this Act; and
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d) dans le cas de la retransmission d’un
signal éloigné, le retransmetteur a acquitté les redevances et respecté les
modalités fixées sous le régime de la présente loi;
|
(e) the
retransmitter complies with the applicable conditions, if any, referred to in
paragraph (3)(b).
|
e) le retransmetteur respecte les
conditions applicables, le cas échéant, visées à l’alinéa (3) b).
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[42]
Finally, the NFL cites article 2006(1) of the
CUSFTA which relates to the requirement for remuneration for retransmission of
a copyright holder’s program:
2006(1) Each
Party’s copyright law shall provide a copyright holder of the other Party
with a right of equitable and non-discriminatory remuneration for any
retransmission to the public of the copyright holder’s program where the
original transmission of the program is carried in distant signals intended
for free, over-the-air reception by the general public. Each party may
determine the conditions under which the right shall be exercised...
|
2006(1) La
législation sur le droit d’auteur de chaque Partie disposera que le titulaire
d’un droit d’auteur de l’autre Partie a droit à une rémunération juste et non
discriminatoire pour toute retransmission au public d’un programme du
titulaire lorsque la transmission originale du programme, faite au moyen de
signaux éloignés, peut être captée directement et gratuitement par le grand
public. Chaque Partie peut déterminer dans quelles conditions ce droit sera
exercé...
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(a)
Conflict of Purpose
[43]
First, the NFL argues that the Final Order is
contrary to the purpose of the Copyright Act. It argues that the Final
Order is discriminatory contrary to the retransmission provisions, specifically
paragraph 31(2)(c) of the Copyright Act and article 2006(1) of
the CUSFTA. The NFL argues that “Parliament could not
have intended that the condition set forth in s. 31(2)(c) be applied or
altered by the CRTC in a discriminatory fashion against a single program, to
the detriment of a single local licensee and single foreign copyright holder”
because this would conflict with article 2006(1) of the CUSFTA.
[44]
Article 2006(1) of the CUSFTA, however, is
concerned with the copyright holder’s ability to be remunerated for its
copyright where its program is retransmitted and not with simultaneous
substitution of commercials. As the respondent notes, Article 2006(1) of the
CUSFTA provides a “right of equitable and
non-discriminatory remuneration for any retransmission … of the copyright
holder’s program” and this right is protected by sections 71 to 74 of
the Copyright Act which provide for tariffs. In support of its argument,
the NFL relies extensively on Cogeco. That decision, however, supports
the conclusion that non-discrimination in retransmission is concerned only with
compensation:
[60] The CRTC’s proposed value for
signal regime would enable broadcasters to negotiate compensation for the
retransmission by BDUs of their signals or programming services, regardless
of whether or not they carry copyright protected “work[s]”, and regardless of
the fact that any such works are carried in local signals for which the Copyright
Act provides no compensation.
[emphasis added]
Thus, although Cogeco found that an
order of the CRTC conflicted with the Copyright Act, it found so, in
part, because the proposed value for signal regime interfered with the right to
remuneration. This is not the case here as remuneration for copyright holders
whose works are retransmitted is provided for in section 71 to 74 of the Copyright
Act.
[45]
It is well established that the purpose of the Copyright
Act is to balance authors’ and users’ rights (Théberge v. Galerie d’Art
du Petit Champlain inc., 2002 SCC 34, [2002] 2 S.C.R. 336 (Théberge)).
This purpose was affirmed in Cogeco at paragraph 64 citing CCH
Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13 at paras. 10, 23,
[2004] 1 S.C.R. 339):
[64] … This Court has characterized the
purpose of the Copyright Act as a balance between authors’ and users’
rights. The same balance applies to broadcasters and users. In Théberge,
Binnie J. recognized that the Copyright Act
is usually presented as a balance
between promoting the public interest in the encouragement and dissemination of
works of the arts and intellect and obtaining a just reward for the creator
(or, more accurately, to prevent someone other than the creator from
appropriating whatever benefits may be generated). [para. 30]
[46]
In essence, the NFL argues that there is another
purpose of the Copyright Act—to create a non-discriminatory right. In my
view, the NFL is trying to elevate a principle limited to a small section in
article 2006(1) of the CUSFTA pertaining to the remuneration for retransmission
to a principle of general application across the Copyright Act. I see no
conflict between the Final Order and the purpose of the Copyright Act.
(b)
Operational Conflict
[47]
Second, the NFL argues that the Final Order
conflicts operationally with the Copyright Act. It argues that the Final
Order conflicts with subsection 31(2)(c) because it is not “required or permitted by or under the laws of Canada”.
I disagree.
[48]
The Final Order complies with each of the
enumerated requirements in subsection 31(2) of the Copyright Act and so
meets the requirements of the exception to the exclusive transmission rights.
This past February when the Super Bowl was broadcast without simultaneous
substitution, the program was (a) retransmitted by a local or distant signal,
(b) this transmission was lawful under the Broadcasting Act, (c) it was
retransmitted simultaneously and without alteration, and (d) the retransmitter,
Bell, had paid for its licence. Paragraph (e) was not applicable as the
Governor in Council had not made any regulation.
[49]
The NFL’s argument that the Final Order
conflicts operationally with paragraph 31(2)(c) specifically must fail
following the Court’s conclusion above that the Final Order was within the
CRTC’s jurisdiction. The NFL argued that “[i]f a BDU
wishes to take the benefit of the user right in a manner permitted under s.
31(2)(c) of the Copyright Act, it must comply with any signal
alteration requirements mandated under the ‘laws of Canada’, and the only
such law of Canada that is applicable is the Sim Sub Regulations”
[emphasis in original]. Having found that the Final Order made pursuant to
paragraph 9(1)(h), by way of subsection 4(3) of the Sim Sub
Regulations—a law of Canada—was within the CRTC’s jurisdiction, there can be no
operational conflict with paragraph 31(2)(c) of the Copyright Act.
[50]
Thus I see no conflict of purpose or operational
conflict between the Final Order and the Copyright Act.
VI.
Conclusion
[51]
I would dismiss the appeal with costs.
"David G. Near"
“I agree.
Wyman W. Webb J.A.”
“I agree.
Mary J.L.
Gleason J.A.”