Broadcasting Distribution Regulations (SOR/97-555)

Application

2 These Regulations apply to persons licensed to carry on a distribution undertaking, other than a person licensed to carry on

• (a) a subscription television system;

• (b) a relay distribution undertaking; or

• (c) an undertaking that only rebroadcasts the radiocommunications of one or more other licensed undertakings.

PART 1General

Prohibition

3 A licensee shall not distribute programming services except as required or authorized under its licence or these Regulations.

Transfer of Ownership

• 4 (1) The definitions in this subsection apply in this section.

  associate

  associate, when used to indicate a relationship with a person, includes

  • (a) a partner of the person;

  • (b) a trust or an estate in which the person has a substantial beneficial interest or in respect of which the person serves as a trustee or in a similar capacity;

  • (c) the spouse or common-law partner of the person;

  • (c.1) a child of the person or of their spouse or common-law partner, including a child adopted in fact by the person or by the spouse or common-law partner;

  • (c.2) the spouse or common-law partner of a child referred to in paragraph (c.1);

  • (d) a relative of the person, or of the spouse or common-law partner referred to in paragraph (c), if that relative has the same residence as the person;

  • (e) a corporation of which the person alone, or the person together with one or more associates as described in this definition, has, directly or indirectly, control of 50% or more of the voting interests;

  • (f) a corporation of which an associate, as described in this definition, of the person has, directly or indirectly, control of 50% or more of the voting interests; and

  • (g) a person with whom the person has entered into an arrangement, a contract, an understanding or an agreement in respect of the voting of shares of a licensee corporation or of a corporation that has, directly or indirectly, effective control of a licensee corporation, except when the person controls less than 1% of all issued voting shares of a corporation whose shares are publicly traded on a stock exchange. (liens)

  common-law partner

  common-law partner, in respect of a person, means an individual who is cohabiting with the person in a conjugal relationship, having so cohabited for a period of at least one year. (conjoint de fait)

  common shares

  common shares means the shares that represent the residual equity in the earnings of a corporation, and includes securities that are convertible into such shares at all times at the option of the holder and the preferred shares to which are attached rights to participate in the earnings of the corporation with no upper limit; (actions ordinaires)

  person

  person includes an individual, a partnership, a joint venture, an association, a corporation, an estate, a trust, a trustee, an executor and an administrator or a legal representative of any of them. (personne)

  voting interest

  voting interest, in respect of

  • (a) a corporation with share capital, means the vote attached to a voting share;

  • (b) a corporation without share capital, means an interest that entitles the owner to voting rights similar to those enjoyed by the owner of a voting share;

  • (c) a partnership, a trust, an association or a joint venture means an interest or right in the assets of it that entitles the owner to receive a share of its profits, to receive a share of its assets on dissolution and to participate directly in its management or to vote on the election of the persons to be entrusted with the power and responsibility to manage it; and

  • (d) a not-for-profit partnership, trust, association or joint venture, means a right that entitles the owner to participate directly in its management or to vote on the election of the persons to be entrusted with the power and responsibility to manage it. (intérêt avec droit de vote)

  voting share

  voting share means a share in the capital of a corporation, to which is attached one or more votes that are exercisable at meetings of shareholders of the corporation, either under all circumstances or under a circumstance that has occurred and is continuing, and includes any security that is convertible into such a share at all times at the option of the holder. (action avec droit de vote)

• (2) For the purposes of this section, control of a voting interest by a person includes situations in which

  • (a) the person is, directly or indirectly, the beneficial owner of the voting interest; or

  • (b) the person, by means of an arrangement, a contract, an understanding or an agreement, determines the manner in which the interest is voted, but the solicitation of proxies or the seeking of instructions regarding the completion of proxies in respect of the exercise of voting interests is not considered to be such an arrangement, contract, understanding or agreement.

• (3) For the purposes of this section, effective control of a licensee or its undertaking includes situations in which

  • (a) a person controls, directly or indirectly, other than by way of security only, a majority of the voting interests of the licensee;

  • (b) a person has the ability to cause the licensee or its board of directors to undertake a course of action; or

  • (c) the Commission, following a public hearing of an application for a licence, or in respect of an existing licence, determines that a person has such effective control and sets out that determination in a decision or public notice.

• (4) Except as otherwise provided under a condition of its licence, a licensee shall obtain the prior approval of the Commission in respect of any act, agreement or transaction that directly or indirectly would result in

  • (a) a change of the effective control of its undertaking; or

  • (b) a person who, alone, or together with an associate,

    • (i) controls less than 30% of the voting interests of the licensee, having control of 30% or more of those interests,

    • (ii) controls less than 30% of the voting interests of a person who has, directly or indirectly, effective control of the licensee, having control of 30% or more of those interests,

    • (iii) owns less than 50% of the issued common shares of the licensee, owning 50% or more of those shares but not having, directly or indirectly, effective control of the licensee, or

    • (iv) owns less than 50% of the issued common shares of a person who has, directly or indirectly, effective control of the licensee, owning 50% or more of those shares but not having, directly or indirectly, effective control of the licensee.

• (5) A licensee shall notify the Commission within 30 days after the occurrence of any act, agreement or transaction that, directly or indirectly, results in a person who, alone, or together with an associate, controls less than

  • (a) 20% of the voting interests of the licensee, having control of 20% or more but less than 30% of those interests;

  • (b) 20% of the voting interests of a person who has, directly or indirectly, effective control of the licensee, having control of 20% or more but less than 30% of those interests;

  • (c) 40% of the voting interests of the licensee, having control of 40% or more but less than 50% of those interests but not having, directly or indirectly, effective control of the licensee; or

  • (d) 40% of the voting interests of a person who has, directly or indirectly, effective control of the licensee, having control of 40% or more but less than 50% of those interests but not having, directly or indirectly, effective control of the licensee.

• (6) A notification referred to in subsection (5) shall set out the following information:

  • (a) the name of the person or the names of the person and the associate;

  • (b) the percentage of the voting interests controlled by the person or by the person and the associate; and

  • (c) a copy or a complete description of the act, agreement or transaction.

Offer of Basic Service

4.1 Except as otherwise provided under a condition of its licence, a licensee shall offer its basic service to its subscribers and to prospective subscribers.

Distribution of Basic Service

5 Except as otherwise provided under a condition of its licence or these Regulations, a licensee shall provide a subscriber with its basic service or, if offered, its first-tier offering, if it provides the subscriber with a programming service other than

• (a) an on-demand service; or

• (b) an exempt programming service, other than an exempt discretionary service.

Majority of Canadian Programming Services

• 6 (1) Except as otherwise provided under a condition of its licence, a licensee shall ensure, in respect of each of analog and digital technology, that a majority of each of the video and audio programming services that are offered to a subscriber are devoted to the distribution of Canadian programming services.

• (2) For the purposes of subsection (1), each programming service of one of the following types counts as a single video programming service regardless of the number of channels on which that programming service is distributed by a licensee in a licensed area:

  • (a) pay television service; and

  • (b) on-demand service.

  • (c) and (d) [Repealed, SOR/2015-239, s. 4]

• (3) For the purposes of subsection (1), each analog service, standard definition service and high definition service of the following types of programming service counts as a single video programming service:

  • (a) licensed television station;

  • (b) discretionary service;

  • (c) programming service that is distributed under paragraph 17(1)(g);

  • (d) authorized non-Canadian programming service; and

  • (e) non-Canadian television station.

Alteration or Deletion of Programming Service

7 Subject to section 7.2, a licensee shall not alter the content or format of a programming service or delete a programming service in a licensed area in the course of its distribution except

• (a) as required or authorized by a condition of its licence or under the Simultaneous Programming Service Deletion and Substitution Regulations.

• (b) for the purpose of complying with subsection 328(1) of the Canada Elections Act;

• (c) for the purpose of deleting a programming service to comply with an order of a court prohibiting the distribution of the service to any part of the licensed area;

• (d) for the purpose of altering a programming service to insert a warning to the public announcing

  • (i) any danger to life or property if the insertion is provided for in an agreement entered into by the licensee with the operator of the service or the network responsible for the service, or

  • (ii) an imminent or unfolding danger to life if there is no agreement with the operator of the service or the network responsible for the service;

• (e) for the purpose of preventing the breach of programming or underlying rights of a third party, in accordance with an agreement entered into with the operator of the service or the network responsible for the service;

• (f) for the purpose of deleting a subsidiary signal, unless the signal is, itself, a programming service or is related to the service being distributed; or

• (g) for the purpose of inserting a commercial message, if the insertion is in accordance with an agreement between the licensee and the operator of a Canadian programming service or the network responsible for that Canadian programming service and that agreement pertains to commercial messages directed at a target market of consumers.

Commercial Messages

• 7.1 (1) Except as otherwise provided under a condition of its licence, a licensee that alters the audio content or audio format of a programming service under paragraph 7(a) or (g) shall ensure that every commercial message complies with the technical requirements set out in ATSC Recommended Practice A/85: Techniques for Establishing and Maintaining Audio Loudness for Digital Television, published by the Advanced Television Systems Committee Inc., as amended from time to time.

• (2) Except as otherwise provided under a condition of its licence, a licensee that distributes an authorized non-Canadian programming service shall ensure that every commercial message complies with the technical requirements set out in ATSC Recommended Practice A/85: Techniques for Establishing and Maintaining Audio Loudness for Digital Television, published by the Advanced Television Systems Committee Inc., as amended from time to time.