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CRTC faces new challenge from coalition of producers over TV changes

The federal broadcast regulator is facing yet another possible court challenge pushing back against sweeping changes to television policy unveiled in recent months, this time from a coalition of independent producers.

The Canadian Media Production Association (CMPA) is looking to overturn a decision that could do away with agreements that set negotiating terms between the country’s largest broadcasters and independent producers – and which the producers see as critical safeguards of their bargaining power.

In a March 12 ruling, the Canadian Radio-television and Telecommunications Commission (CRTC) decided “terms of trade,” which divide up certain rights between broadcasters and producers, are no longer needed. “Broadcasters and producers now have the clarity and experience they need to negotiate any future agreement among themselves,” the regulator wrote. The change was just one of several stemming from Let’s Talk TV, a sprawling regulatory hearing into the future of TV, but it garnered little attention.

TV producers and creators say they felt ambushed. “[The CRTC] never asked us a question on the matter,” said Michael Hennessy, president and CEO of the CMPA, which represents more than 350 companies that create TV programs, films and digital media. He noted none of the 29 topics debated at the hearing dealt with terms of trade, and said doing away with them without a full discussion is “unconscionable.”

Now, the CMPA fears broadcasters will be able to push its members around, and it’s seeking leave to appeal the decision in federal court.

“Terms of trade are critically important from our end,” Mr. Hennessy said.

The CRTC is now being forced to defend its rulings on several fronts. BCE Inc., which owns Bell Canada and 15 per cent of The Globe and Mail, has won leave to appeal a decision on its mobile TV plans, and is seeking to go to court to protest a ruling that would open the door to American Super Bowl ads on Canadian TV.

In addition, Bell and a group of other wireless carriers, including Rogers Communications Inc., Telus Corp., MTS Inc. and SaskTel, also appealed to the Federal Court over a provision of the CRTC’s wireless code. The court heard the matter in November but has not yet ruled.

Terms of trade were created in 2011 as a way to balance the bargaining power between producers and the broadcasters owned by large media and communications conglomerates that also distribute content. Since then, the largest such companies – Bell, Corus Entertainment Inc., Rogers Communications Inc. and Shaw Communications Inc. – have had to adhere to the terms as a condition of being licensed.

The terms dictate which company retains certain rights before a negotiation begins, such as who gets to sell the show internationally, for example, and how the two sides divide up tax credits. The price of any licensing deal must still be bargained.

Starting in 2016, the largest media companies can apply to have the terms removed from their licences, which would give them more freedom to bargain favourable deals with content producers.

“Unless you have something like [terms of trade] in place, and it’s a condition of licence, then the broadcasters have all the power to wait you out and squeeze you,” Mr. Hennessy said.

A CRTC spokesperson declined to comment as the matter is before the courts.

Nevertheless, the CMPA is not alone in its concerns. The Alliance of Canadian Cinema, Television and Radio Artists (ACTRA) was “blindsided” by the decision, said national executive director Stephen Waddell.

And John Barrack, strategic counsel and partner at Don Carmody Television, who was a chief negotiator on the first terms of trade agreement, called the CRTC’s ruling “a questionable decision.” In an interview, he said terms of trade “still has a place” because the bargaining table “is not an equal playing field.”