[Recorded by Electronic Apparatus]
Tuesday, October 8, 1996
.1106 
[English]
The Chairman: I call to order this meeting of the Standing Committee on Canadian Heritage.
[Translation]
We are starting our hearing of October 8 with a study of Bill C-32, an Act to amend the Copyright Act.
[English]
We have before us Mr. Michael McCabe, president and CEO of the Radio Board of the Canadian Association of Broadcasters; Jane Logan, vice-president of radio; Peter Miller, senior vice-president and general counsel; David MacLean, who is general manager of CJFX, Antigonish, Nova Scotia...
[Translation]
and Ms Dianne Wilson, General Manager of Energy 1200/Majic 100.
[English]
Mr. McCabe, you have 45 minutes. If by any chance you could keep your own remarks short to allow for time for the members.... We'll leave it to you. The floor is yours.
Mr. Michael McCabe (President and Chief Executive Officer, Canadian Association of Broadcasters - Radio Board): Thank you very much, Mr. Chairman; and good morning, members of the committee.
Thank you very much for the opportunity to present the concerns of the Radio Board of the Canadian Association of Broadcasters. As you know, we have two parts to our industry, the radio and the television. We will focus here on our concerns in the radio industry.
There are nearly 500 private radio stations across Canada, and we represent the vast majority of them. We represent both French- and English-language stations. The French-language stations have some very particular concerns in addition to sharing in our general concerns about this legislation. Since they are appearing immediately after us, we may in fact refer some questions to them, because they may be more appropriate as responders to those.
I'd like to start off by indicating that radio is basically a small business. The total revenue of the entire radio industry last year was only about half of the CBC's revenue for last year, for instance. When you think of all the services private radio stations across the country provide in our communities - you know about them because you live there - it is truly amazing, we think.
You have already indicated who we have with us today, but I think it's important that we have a mix of people who represent radio stations in communities and members of our staff who have been studying this bill carefully.
[Translation]
This is a very complicated bill. In our brief, we recommend 12 specific amendments, including the addition of new provisions to establish the criteria the Copyright Board should use to set fair rates.
For now, we will highlight only a few of our concerns. However, we urge the Committee to review the brief we have tabled on the radio industry and to refer to it when it proceeds with clause by clause study of the bill.
.1100
All of our proposed amendments are extremely important.
[English]
We're deeply concerned about three areas of Bill C-32 that hurt local radio. They are neighbouring rights, the lack of a time-shifting, and a transfer-of-format exception in the legislation. I'd like to start off with Jane Logan addressing the neighbouring rights question.
Ms Jane Logan (Vice-President, Radio, Canadian Association of Broadcasters - Radio Board): Members of the committee, let me describe how radio today pays for the use of its music. As we've told you in the past, radio stations play the music and listeners buy recordings because they hear them on the radio. Radio stations pay about $22 million a year to the authors and composers of the songs they play. That's fair, because this group earns very little from record sales, maybe 40¢ per CD in total, and they are, after all, the original creators. Performers, on the other hand, are well paid from the sales of successful recordings and from concert tickets. They earn $2 to $3 from the sale of every successful CD. The record company makes about the same amount. Radio air play, which generates these sales, has traditionally been considered radio's full compensation to performers and record companies.
This system works. It has worked for years. It's also fair.
What has changed to cause performers and record companies to want money from radio now? The motivation behind the search for new revenues comes from changes in technology which threaten sales of recordings.
Imagine you were a performer. You would certainly worry that someone could take your CD, make dozens of perfect copies of it using digital recording equipment, and even post it on the Internet for thousands of others to do the same without payment. That is a major threat to the traditional sales of recordings. It is a real problem. But radio doesn't contribute to this problem and should not have to pay for it through neighbouring rights.
The fact is that radio has always been and continues to be the number one reason why Canadians buy recordings. Last Thursday, before this committee, the Minister of Canadian Heritage stated that the Canadian music industry has blossomed and has developed a critical mass of artists because of Canadian content rules. Those rules are on the radio. Radio plays Canadian records 30% of the time, and this radio air play is responsible for the success and growth of the Canadian music industry.
We're here to ask for a full exemption for radio from neighbouring rights based on the value of our air play to performers and record companies. Study after study proves that the number one reason why Canadians buy recordings is that they heard them on the radio. Last May, for example, the Angus Reid Group conducted an independent survey of 1,000 Canadians who had bought a CD, tape, or record in the past six months. They found radio was not only the number one factor influencing that purchase but it outstripped the influence of television and music video channels, which were the next biggest factor, by three to one. I would be happy to provide a copy of that study to members of the committee.
The Angus Reid results were no surprise. They confirmed a study done in Quebec for the music industry and four studies of Canadian teenagers which were conducted earlier by Decima Research. Those studies are detailed in our brief.
We're not against neighbouring rights for the new technologies that will hurt music sales. If we run businesses such as pay audio services, we expect to pay neighbouring rights. But radio already compensates the music industry in full, because it helps to sell recordings. It should be exempt for this reason.
In the United States last year both the threat of new technology and radio's contribution to the music industry were recognized in a copyright bill which balanced the interests of creators and copyright users. It exempted radio but it did impose the equivalent of neighbouring rights for new digital technologies. We think that's a good compromise.
[Translation]
We have a lot of similarities with American radio. In Canada, as in the United States, most radio stations are privately-owned. There are local businesses that serve small communities.
The Canadian and American broadcasting systems are very different from the European broadcasting systems. In Europe, private radio is a relatively new phenomenon after many years of predominantly state run radio stations. Private radio stations in Europe are not as community-oriented as here and do not play as big a role in promoting talented individuals as radio stations do here.
.1115
[English]
And we're not only similar to the American broadcasting system, we compete with it head-on in every border town. Compared to U.S. radio stations, Canadian radio pays 15% more for copyright today. So you can imagine what a great concern neighbouring rights are to stations in border towns. You can't have a cost structure that's higher than your competitor's and remain competitive. You have to cut costs somewhere, and these cuts will affect radio service.
The drafters of this legislation have recognized the difficulty small radio stations will have dealing with new expenses, and they've allowed an exemption for the first $1.25 million of a radio station's revenue. This exemption is a step in the right direction, but we need a full exemption for all private commercial radio stations.
[Translation]
I am sure you all know that Canada's radio stations have had tremendous financial difficulties and are far from being viable operations. Approximately half of the stations lost money last year. You will find all those details in our brief.
[English]
Most radio stations in Canada belong to companies which own two or more stations. The bigger, more profitable stations have often carried their less profitable counterparts during these lean years. The bottom line is that if larger stations are saddled with neighbouring rights, they will be less able to cross-subsidize smaller stations, and the smaller stations will suffer.
Mr. McCabe: Thank you very much, Jane.
I will now ask our two radio board members to tell you about the other two issues that most concern us, the absence of two common-sense exceptions for practices used every day in radio stations, practices that are essential to carrying on our business.
First, Dianne Wilson will talk to us about the need for a transfer-of-format exception.
Ms Dianne Wilson (Radio Board, Canadian Association of Broadcasters): Transfer of format is routine at every radio station. It starts when we are first given CDs by local record companies. Each record company has one staff member assigned to work local radio in Ottawa. I brought the CDs that I received last week. There are 57 of them in the bag. I won't bore you with all of them, but -
Mr. McCabe: I thought you were going to read all of the titles.
Some hon. members: Oh, oh!
Ms Wilson: The chair has asked us to be brief.
We received 57 for one of our radio stations just last week. We have two radio stations, so I'm not strong enough to bring all of them.
Radio stations rarely play music directly from vinyl recordings or even from CDs. We transfer the music from the original format to a tape cartridge like this one or to our computer hard drives in order to put the music on the air. It's always been that way. Why? It's done to preserve the quality of the music. Records and even CDs deteriorate with repeated use, and even brand-new records and CDs may have cracks and pops. We insist on a technically perfect sound quality.
My two radio stations, like about half of the radio stations across Canada, have moved to the latest technology and installed computer hard-drive systems to get operating efficiencies and the best audio quality.
Every computer-integrated business knows what a computer crash is like. We make back-up tapes of our hard drive to allow us to restore it in a very short period of time. Some stations have as many as 4,000 songs in their active repertoire.
As I understand it, without an exception in this legislation, we will have to start paying for these service copies. If an artist gives us his CD and begs us to play it and we put it on the computer server, we have to pay. That doesn't make sense. If we discover a neat old vinyl recording and want to add it to our repertoire, we'll have to pay a fee. That doesn't make sense. If we're good business persons and we make back-up copies of our files in case of a computer disaster, we have to pay a fee. That doesn't make sense.
We already pay SOCAN fees for the music that we air. The only way to do this with modern technology is to transfer the format. Now the same people want us to pay twice for the same purpose. That doesn't make much sense. I could understand it if we were making CD copies and selling them, but there's no commercial gain here. We're just using a product we've already paid for, and we'll have to pay the same people again. That doesn't make sense.
I'm also scared that this activity will generate a new level of administration at each radio station. Who's going to do these things? Who's going to keep track of every transferred or time-delayed song before it goes to air; figure out who holds the rights for each song, and where, and in which country we can reach them; contact them and negotiate a deal in advance of airing; and look after all of the paperwork for submitting the fees?
I'd like to know where the money is going to come from for the staff time and the fees. To afford the fee we'll have to reduce other costs - cut back on news or community projects like our Christmas effort, Toy Mountain, or Canada Day.
.1120
At my radio stations we number several Canadian artists as friends. They recognize and appreciate the synergy of our relationship and they know we will do whatever we can to further their music.
Radio takes risks to promote Canadian artists. Our station has given Alanis Morrissette $42,000 over the last eight years. We played her music when no one else did. We shamelessly featured her, invited her to co-host various shows and hired her to play at community events. We've supported many other artists along the way. Some have become stars, others not. Every day someone shows up at our door looking for a break, for someone to play their CD, hoping they'll be the next Alanis Morrissette or Neil Young. The barrier to these artists presented by Bill C-32 is substantial.
Some things we can't avoid, like backing up our computer system. Some of the other things we do today such as concerts and specials will be discontinued to avoid new payments and complicated pre-clearance, unless you change this bill.
When a local performer walks in off the street and asks us to put their tape on air, I'm not sure how we'll do this any more. We can't afford to track down the author, the composer and the music publisher and get their permission first. The performer may say it's his own composition, but how can we take that risk?
This is sad, as not only will radio in Canada take a on a different face, but the artists who once benefited from these activities will see those benefits end as a result of the bill intended to help them.
Now I'll ask David to tell you something about the time-shifting exception we also need.
Mr. David MacLean (Radio Board, Canadian Association of Broadcasters): Thank you very much, Dianne.
Mr. Chairman, members of the heritage committee, I join with my associates in thanking you for the opportunity to appear before you this morning. I'm pleased to be able to present to you in person some of the suggestions that I hope will help you improve the design of Bill C-32 so that neither broadcasters nor performers will be adversely affected by elements that relate to the use of recorded material for radio broadcast on a day-to-day basis.
My concern is with the legislation as it relates to ephemeral rights. In the broadcasting business the term is frequently understood to refer to something that we call time shifting or delayed broadcast. In either case, the reference is to the recording and editing of a program for use at a later time. It's a common practice with most broadcasters today, and it really is quite essential for any broadcaster who wants to ensure that there is an element of professionalism in the sound of the program that is being aired.
By way of example, I hope I can demonstrate some of the practical implications of the application of the proposed legislation. At CJFX Radio in Antigonish we've been recording programs in advance of broadcast for more than 50 years. We've always paid the copyright fees for all of the material that is broadcast or played on the radio, but the technology has been changing. We've gone from vinyl and metal disks into which we literally cut the recorded material 50 years ago, to computer hard-disk drives today.
We go out in the community to record choral groups, bands from our local schools, orchestras and ensembles from St. Francis Xavier University and choirs from the local cathedral. For decades we've been going to concerts and variety shows to record performances by violinists, pipers, piano players and singers for possible use in our broadcast schedule. During the Christmas season, church groups and schools often ask us to record the children's choruses and choirs in the hope that we will be able to use the selections as part of our programming during the festive season.
These recordings are taken back to the station to be edited to make sure they will fit into a 30- or 60-minute timeframe. As well, it's very important that any technical or performance imperfections are edited out so that the performance will have an optimal sound. This editing process enables us to add some informative commentary by an announcer that would be related to the compositions, to the venue or to the occasion.
Since its inception 50 years ago, my radio station has had a close association with St. Francis Xavier University in Antigonish. There has always been a strong interest expressed in the community for coverage of special occasions like spring and fall convocations. Since these events are usually held both in the morning and in the afternoon, it means I have to have the material recorded and very quickly edited to take out any repetition of the two ceremonies, tie the two convocations together and then broadcast it as a continuous event.
Often the ceremony features performances by the local high school or university orchestra. On several recent occasions the degree recipient, like singer Maureen Forrester, sang or performed a piece of music as a part of the convocation. This would pose a real problem for me in the event that there was a prohibition from using this material without having prior approval from the performer and the copyright holder.
.1125
Every day, as part of our broadcast schedule, we have a one-hour program we call The Ceilidh. It features traditional Cape Breton, Irish, and Scottish recorded material. The program contains a considerable amount of music that's recorded locally by artists who do not have commercially recorded material. These types of programs have provided a springboard for many performers, such as Ashley McIsaac and the Rankin Family, who today occupy a position of prominence on the national scene. Our program enjoys a large following and provides an opportunity for many new artists to gain public exposure. This exposure in turn makes a wide audience aware of the performer and he or she develops new performance opportunities.
Without the protection of an ephemeral rights exemption I would be very concerned that my ability to continue with this type of programming would be threatened. I feel this would be most regrettable. As a radio station we've been reflecting our community in the broadcast of its music, featuring a wide range of individuals and groups. We've been doing that for more than fifty years.
The irony is that if these performers were to come to our studios and perform live, we'd have no problem. But if we go out to a place where the artists are comfortable and at ease with their surroundings, record them and take the material back to the studio and edit it for broadcast, we'd have a problem, as a result of the legislative provisions you are considering in this legislation.
My point is that the national stage in Canada is filled with artists and performers who have received their start in the fashion I've been describing. Many of them have come from my area and this is how their careers have unfolded. I'm proud of their achievements and the national attention they have attracted. I would like to make sure the music continues. I would ask you to ensure there is no weakening of our ability as a broadcaster to express our cultural heritage, since our culture is the vehicle for expressing and strengthening confidence in ourselves and in our way of life.
Mr. McCabe: You've heard from just two radio stations here today. This story could be repeated by 500. We've tried to put the very practical concerns we have - nothing to do with theory - about parts of the legislation that won't work for us. We know of at least 25 other countries that have granted these exceptions in copyright law to broadcasters. Both exceptions are needed so we can operate our business in the modern computer age. We can't put the music we've paid for on the air without them. We're asking you to modernize the bill for us as well as for creators.
You may hear from bureaucrats or from the music industry that they can resolve the nightmare of administrative issues surrounding the payment of these rights Dianne has talked about. They are talking theory, and they don't know what they're talking about. They don't know the practical reality of running a radio station.
In any case, the whole concept of paying the same rights-holders twice for the same purpose strikes us as making no sense whatsoever, and as being grossly unfair. If you come from other parts of the country and you come here as a member of Parliament, it's as if the person who charges you rent for your apartment here in Ottawa suddenly said that in order for you actually to use your apartment, there will be an additional fee every time you use the key. That strikes us as pretty unreasonable. I think it might strike you as unreasonable too.
I'd like to say a final word about the harsh civil remedies and statutory damages proposed in this bill. These compound our difficulties. If you do not provide these exceptions we've been talking about, we risk being fined very heavily for purely technical infringements, or even being shut down under injunction.
Bill C-32 as currently drafted creates three unfair financial burdens on radio which will impair service to our communities and limit our ability to move to new technologies. Heritage officials told you last week that neighbouring rights could cost private radio up to $8 million annually, while the cost of time-shifting and transfer of format rights could range from $2 million to $5 million, we feel. These amounts will escalate over time. They will severely hamper the radio industry's plans to move to digital radio, which is the industry's key to being a player on the Information Highway, and they will cause cuts to local service. The lack of the time-shifting and the transfer of format exception for broadcasters will, as you've heard from our two radio station members here, have a significant impact on local programming. We don't believe Parliament should enact legislation that will cause local programs to be removed from radio schedules.
We've not reviewed every one of the radio board's twelve recommendations on the bill this morning, but each one of them is important to us. We have time to touch only on the highlights here, but we urge the committee, in its clause-by-clause review, to take a look at every part of our brief.
.1130
As members of the Standing Committee on Canadian Heritage, you have the opportunity to meet the government's intention of creating jobs and strengthening Canada's culture by adopting the recommendations we have proposed in our brief.
Radio, as a cultural industry, makes a tremendous contribution to Canada by showcasing its artists and its music. We have in effect created a music industry, and radio also creates a sense of both Canadian and community identity toward listeners. These vital roles are in danger. You can maintain them with what you do in this committee.
Thank you. We're available for your questions.
The Chairman: Mr. McCabe, you and your colleagues have made your viewpoints very clear to us. I think you have been concise and very clear. We understand where you're coming from.
I'd like to turn the meeting over to questions by the members. We have barely 21 minutes left, so my decision will be to allow each party representative, starting with the opposition parties -
[Translation]
We will give five minutes to each of the three parties and we'll then divide the remaining time among members who have further questions.
Mr. Leroux.
Mr. Leroux (Richmond - Wolfe): Thank you for your presentation. I think we have just started an extremely important process by dealing with this major bill, which I would compare to a food chain. The food chain operates in an economic and cultural industry, where there are both the rights holders and those who create and produce scripts and music which must get into the chain and be broadcast and distributed so that people can appreciate them and buy them, and so that culture is broadcast everywhere.
We, the Official Opposition, understand the scope of this bill and its implications. We clearly came to the conclusion that the tabling of Bill C-32 came after a long wait to have some clarification on neighbouring rights, performance rights and producers rights.
You may also recall that I defended my position during press conferences and in the House. I said we could not break the food chain. You have to look at the economic situation of broadcasters, of all those who broadcast the content. We think that it is extremely important.
Earlier on, you asked a question which I find important, when you asked what had changed for us to request neighbouring rights. I also have some questions about the ceiling of $1,250,000 for advertising. You disagree with that. You think there should be a complete exemption.
I have a hard time understanding that. All neighbouring rights are recognized in 50 countries. We are not dealing with something outdated; we are talking about something fairly basic. The eligible parties, the performers can join a network of 50 countries that have both copyright and neighbouring rights. Both, you would like to see a total exemption.
I would like to know why you are of that opinion, despite the economic details you gave us. Why forego the opportunity to be part of that huge network of 50 countries who have neighbouring rights? And why is that provision on a ceiling of $1,250,000 worthless?
Ms Logan: First of all, we do not agree in principle that radio stations should pay for neighbouring rights. The 50 countries that have neighbouring rights do not have the same broadcasting system as we have in Canada. Here, radio stations in small communities provide a local service.
In France, for example, private radio stations have been in existence for only five or ten years now. They do not have a long history. In Europe, a radio station often has a national audience.
.1135
In France, you could have an audience of 50 or 65 million. In London, England, seven radio stations serve a population of nearly 7 million, whereas in Montreal, there are 16 radio stations for a population of 2.5 million.
Our broadcasting systems are very small and very different. In Europe, state radio has prevailed for many years. Some countries do not even have private radio stations. So the situation there isn't at all like ours. We are much more similar to the United States, where radio stations serve small communities.
Mr. Leroux: Let me get back to the question of the United States. After all, Mr. McCabe gave us a lot of documentation; he wrote to us every week. I hope he will not forget us and will continue to do so.
Let's look at the small communities and the advertising revenue ceiling of $1,250,000. Let me use the market that I know as an example, the Eastern townships, where I live. There are two radio stations, one AM and one FM. If we were to use the ceiling of $1,250,000, one of the two stations is totally exempt and would have cost of approximately $100 per year, in accordance with the Act. The other station has advertising revenues of more than $1,250,000, which does not seem like very much.
It seems to me that for small communities, the ceiling would meet your objective, namely to keep regional radio stations and to ensure they continue serving regional markets and playing their important role. We recognize that role and don't deny it. We know they are essential. If you agree with that basic principle, most stations in every market would be exempt, but you do not agree with that principle. You do not want to accept it.
You are telling us it is for development, to promote performers. I have often heard people from the field say they hired a beginner to do a commercial. Since they weren't members of a union, they were given a small contract. The actor was told he was not known and he could get some publicity. Once the actor had started to get known, once he had accumulated enough hours to become a union member, they no longer hired him.
I can't really agree with your argument on recognizing eligible parties and those who should get their fair share, just as I can't accept the notion of being told that an actor will get some publicity. If the cost of advertising is really a major economic issue, because you play music and the listeners buy the records, why is it not a point of collective bargaining? Couldn't you look into it and see whether the matter could be brought before the Board?
Mr. McCabe: Our basic principle is that we already pay for music with our air time. We agree that the ceiling can certainly give us a head start; we are fully aware of that. But in our industry, there are groups. For example, an Am station often does not make money, whereas most FM stations do. Obviously, there are not huge profits. Together, those two groups often form a system to promote music and performers.
However, when you impose additional fees on the strongest station, the entire group is weakened and consequently, promotion of the artist and of the music is weakened.
Mr. Leroux: Let's look at your fifth table.
The Chairman: I am sorry, but your time has run out.
Mr. Abbott.
[English]
Mr. Abbott (Kootenay East): I must say that I'm very sympathetic to the arguments you presented in terms of change of format and time shifting, but it seems to me that what hasn't been discussed is what is happening in an awful lot of very small marketplaces.
We have to recognize that with automation and efficiencies that can be created throughout any industry, these efficiencies must be realized by the radio stations. Nonetheless, I would challenge the second-to-last sentence in your brief, which says says that radio creates a sense of both Canadian and community identity for its listeners. I would suggest that would correctly read that radio has historically created Canadian and community identity for listeners. In fact, in an awful lot of smaller marketplaces - to quote the great Canadian, Brian Tobin - the small radio stations are hanging on by their fingernails. In this case it's not fish that have fingernails but real people.
.1140
We're in a situation right at the moment where in order to try to drive efficiencies there are radio programs that go all across the country, particularly in off-hours, that are picked up all over the place. I'm just wondering if by coming forward with a blanket exemption for time-shifting and change of format, this committee - indeed this legislation - wouldn't be feeding what is going on, which is the gutting of the ability of small communities to have their own personalities speaking into their own microphones.
Mr. McCabe: Let me lead with that and perhaps David or Dianne might follow.
You've hit upon one of our major dilemmas in the business, which is that 75% of our revenue comes from local sources, yet because of the difficult economic times we've had to cut our costs. Where do we cut those costs? We cut them from people because the main chunk of our budgets goes to people. Those are the people who provide the local service. You reflect correctly that it's a problem we have.
What we're suggesting in looking for exceptions here is that if, as Dianne has said, we have to hire more people, not to be in the streets of the city or the town covering that town, but to clear the music, we're going to have great difficulty continuing to keep our local connection there.
Dianne or David, do you want to add to that?
Ms Wilson: I would say yes. Some broadcasters have gutted their radio stations. I believe a radio station is successful because it's vital to the community, and a lot of broadcasters agree with that. But we have to make efficiencies in our operation, so we do it the best we can. Some broadcasters just toss everyone out of the building and put robo-jock on from Toronto - one of those satellite services. That's unfortunate, but my feeling is that a lot of radio stations have done that after they've tried everything else. But most radio stations still provide local service. Some of it is time-delayed. Some of it involves longer shifts for the existing staff. But it's true, we have had to find efficiencies.
Mr. Abbott: Okay. This is exactly my argument. I need to have some assurance from you, before I would agree to this blanket exemption, that it would not simply add to the ability of people to take local news-gathering and local personalities off their local radio stations, because if we do that, we're going to lose a sense of community in Canada.
Ms Logan: I think David MacLean gave you a number of examples showing that without the time-shifting exemption, he won't be able to put his local performers on the air for his one-hour ceilidh show every day, and all these other local performers he highlights. He may well fill that in with something that isn't local. I think the reverse is true from what you're asking.
Mr. McCabe: I think the point is that this is not an exemption we're looking for mainly to be able to transfer something from the satellite onto our operating system. It is really for these 57 CDs that come in the door, in order for us to be able to put them on our operating system for the local artists. It's for David to be able to go to the convocation at St. F.X. and put them on the air the next day or that evening. I mean, that's really what we need to do. It isn't the business of taking something off the satellite.
The Chairman: The Liberal members have asked me to split their time between Mr. Bélanger and Mr. Peric. I imagine it'll give you time for one question each. Monsieur Bélanger.
.1145
Mr. Bélanger (Ottawa - Vanier): I'll ask two questions quickly of the local stations.
I'd like to know from you, without divulging what your revenues are, but just ballparking, what the legislation as it stands represents in terms of additional costs. Just guestimate what the neighbouring rights percentage of revenue might be.
I figure someone has probably estimated that, because everybody seems to agree on a figure of $8 million. That has to be factored somehow on something we've agreed. So I'd like to know what the impact is on your stations, if you can.
Number two is on time-shifting. Every example I've heard today involves a rather short timeframe of a day to a week. Why are you asking for six months?
Mr. MacLean: I can start on the first part, the dollars and cents issue. We're running a relatively small business. I guess it would probably cost $35,000 to $40,000 for the combined elements.
Mr. Bélanger (Ottawa - Vanier): Once it's fully.... Not 20% there. After five years.
Mr. MacLean: Yes.
As to the second part of your question, the time-shifting aspect, we can think of many programs that we may record two or three months before Christmas, for instance, that we'd want to put on at Christmas time. That does happen on occasion.
Realistically there would certainly be occasions when we would want to tie the performance to a particular event. I can think of putting together, for instance, a fund-raising campaign, which we know we're going to do annually in November. Throughout the summer months we will start looking for material we'd like to use during the presentation in November, and then we'll put it on. We'll turn the whole day over to, for instance, the local hospital, and we'll need enough material to cover the day. The only way we can get all of that material, generally speaking, is to pick it out throughout the summer. That's just an example.
Ms Wilson: I would say it would cost us four staff: two staff to pay the fees and two additional staff to have to calculate all of this stuff. That means from my existing staff we would be less four. When I see that, I see the people at the radio station, because that's what I do.
To answer your second question, I would just say flexibility. I would really hate to have a stopwatch on something we've pre-recorded, knowing I have a window to use it and the window to use it isn't necessarily when its best use would be but rather when the limit runs out.
Mr. Peter Miller (Senior Vice-President and General Counsel, Canadian Association of Broadcasters Radio Board): Six months is the average of all those countries we know about that have ephemeral rights. Some have a year; some have unlimited.
Second, it sometimes takes that long to get a clearance or longer. So it's a reasonable limit and there is a lot of international precedent for it.
Back to the financial impact, looking at the industry numbers, you've heard figures such as a total of $8 million for neighbouring rights. You also heard the minister say that ephemeral transfer could cost the industry about $7 million. That accords with our estimates.
But that does not include fines. If you throw in the dimension of fines - and again, these technical infringements we do every day could bring a fine of between $500 and $20,000 - we have no idea what the costs could be. We're talking about really significant costs.
The Chairman: Mr. Peric.
Mr. Peric (Cambridge): Thank you, Mr. Chairman. I have a couple of questions.
I'm very sympathetic to your concerns on transfer of format. You mentioned in your speech that an artist gives you a CD and begs you to play their music. Can you ask them to provide you with a format that can fit your equipment?
Earlier you mentioned that you pay a SOCAN fee. For the record, how much is it? What's the percentage?
When you play the music, do you charge the artist for airtime?
.1150
Ms Wilson: I'll answer the last question first. No. They used to do that in the 1950s and 1960s. They called it payola. When someone brings us a record or a CD, it has to stand on its own merits, whether it's an independent release or a release from one of the huge record companies, such as Virgin Records.
We pay SOCAN 3.2% of gross revenues.
As to the format to fit the equipment, they can't. It's a hard drive. It fits along the continuous tape of everything else that's on the hard drive.
Not that long ago, they used to bring us 45s. It's only been six years since 45s disappeared. We would take it and put it on a tape. Now they bring us CDs.
This is a compilation CD. It has 18 selections on it by 18 different artists all put out by the same record company. When we select something from this that we're going to add to our repertoire, we load it into the hard drive, but only the single cut we want to use. Stompin' Tom Connors has a song on here as well as Lyle Lovett and some really bad rap music. We only put on what we're going to use.
Mr. Peric: What's your approximate cost to transfer from CD to your equipment?
Ms Wilson: It's staff time. That's all. We own the equipment, so it's just staff time. It's the manual labour of actually loading it into the hard drive.
Mr. Peric: Thank you.
Mr. McCabe: But as the bill stands, we would have to pay a fee to do that. That's our concern.
The Chairman: We've barely a minute left.
[Translation]
Mr. Leroux, a very brief question?
Mr. Leroux: With regard to costs, in your table B2, Appendix B, concerning revenue between 1990 and 1995, I noted that in 1995, the overall revenue was $780 million. Let me give you an example of the application of the legislation: the neighbouring rights would represent 0.004% of the total revenue.
You're telling us that there's a grave danger and I must say that I fail to understand the high stakes that you're putting on the table. You're cutting jobs, etc. I have difficulty following that argument.
Now, with regard ephemeral rights, you're requesting them for six months. I'd also like to know how you define these ephemeral rights. In certain countries, when you have discussions with production groups, you have to pay rights. Do your ephemeral rights also apply to a program that could be replayed for an entire summer and that you would keep within your walls? How much time must pass before it is erased? Do you keep these programs? Do you keep a copy in your archives? Do you take any out? Ephemeral rights are not clearly defined.
Mr. McCabe: Peter could begin to answer you about ephemeral rights.
Mr. Miller: Our proposal is six months after the first recording and we can keep a copy in our archives. That's our proposal. It's better than in the United States and many other countries.
Mr. Leroux: You include reproductions, reruns?
Ms Logan: With regard to the impact of neighbouring rights, you can't only look at the percentage of impact on the industry's revenue. We have a lot of expenses. You have to look at the impact on profits.
Mr. Leroux: I know that you must pay banking fees, but they bring in a lot of profit, certainly more than $4 million.
Ms Logan: Profits for last year were $3.6 million before taxes for the private radio industry. After taxes, we lost $3 million. Therefore, imposing neighbouring rights up to a maximum of $8 million will certainly affect us.
[English]
The Chairman: Mr. McCabe, thank you.
[Translation]
I thank you and your colleagues.
[English]
Thank you very much for appearing and making your position clear to all of us. We appreciate it.
Mr. McCabe: Thank you all very much for listening to us.
.1154
.1156
[Translation]
The Chairman: Order, please.
We are pleased to welcome from the Association canadienne de la radio et de la télévision de langue française, Mr. Michel Arpin, president, Mr. Charles Bélanger, treasurer, and Mr. Bernard Guérin, legal advisor to Télé-Métropole.
Gentlemen, you have until 14:40 P.M. to make your presentation. We'll ask you to be brief because the less time you take, the more questions members of the committee can ask.
Mr. Michel Arpin (President, Association canadienne de la radio et de la télévision de langue française): Distinguished members of the committee, ladies and gentlemen, my name is Michel Arpin. I am president of the ACRTF and also vice-president of planning and secretary of Radiomutuel. With me today are Mr. Charles Bélanger, treasurer of our association and president of CFCF Broadcasting Group Inc., and Mr. Guérin, legal advisor to Télé-Métropole.
First, we wish to thank you for allowing us to express our views on the bill currently under consideration. Indeed, as the users of works of all types subject to the Copyright Act, it is in our interest that this legislation be clear and that it includes all the elements needed for our development.
Our association shares the views expressed by the Canadian Association of Broadcasters, to which the majority of our members also belong. During our appearance here, we will attempt to explain our specific situation and experience given the importance of the amendments being proposed and the deficiencies that we feel have to be remedied immediately.
The Association canadienne de la radio et de la télévision de langue française (Canadian French-language radio and television Association) represents French-language television stations and Hertzian, commercial, privately-owned radio stations in Canada. Its membership is made up essentially of firms whose head offices and places of business are located in Quebec.
Our association is a non-profit organization in which membership is voluntary. It represents its members in dealing with various levels of government in relation to matters of interest to its members. The ACRTF represents all French-language television stations and a large majority of French language radio stations which hold a broadcasting licence issued by the CRTC.
French-language radio and television play a leading role in their communities by offering a high-quality Hertzian service at no cost to users. The local service offered by French-language radio and television broadcasters includes information, weather, sports, public affairs, special interest programming and entertainment, among other things.
In addition, these radio and television stations offer their listeners or viewers programming that originates with networks that are well anchored in the francophone universe. In the case of radio, the importance placed on the service offered to the local community could be diminished by the enactment of legislation for the benefit of performers and makers of sound recordings.
This legislation will substantially increase their operating costs, in an industry that experienced heavy losses in the last decade and which contributes significantly to the success of the music industry.
Moreover, the absence of technological transfer rights limits our ability to benefit from the advantages of new technology and involves significant copyright costs. In terms of television, the absence of an exception to the right of ephemeral recording jeopardizes the production of programs that must be manipulated several times in order to achieve a high-quality product that increasingly meets international standards and prevents the use of timely works. Broadcasters also share the same problem with regard to the absence of an exception allowing transposition or change of format for purely technological purposes.
.1200
The ACRTF is asking that the Canadian Copyright Act not grant any pecuniary right to performers and makers of sound recordings. The ACRTF recognizes that new technologies may be a threat to the music industry and that legislation in respect of neighbouring rights may be the ideal instrument for protecting the rights of the players in the music industry. For this reason, we do not object to Parliament introducing the necessary mechanisms in Canada to protect the owners of various rights.
The position of the French-language broadcasters derives from their role as agents for the marketing of musical works to listeners and their important financial contribution to the greater welfare of the music industry and the attainment of Canadian cultural objectives.
Numerous studies have recognized the tremendous importance of radio in communicating musical works and making them known. Many surveys, the most recent being one conducted by Angus Reid for the CBA, point out the role played by radio in decisions by consumers in both Canada and Quebec to buy a work. The Angus Reid study corroborates four similar studies carried out for MusicAction by Léger & Léger in 1993 and 1994.
In addition to the arrangement of convenience, since radio benefits from the material supplied by mutual agreement by makers of sound recordings for radio station's programming, as Ms Wilson explained earlier, we also have the promotional activities surrounding launches of new works, concerts by performers and, most important, the financial contributions of broadcasters to programs such as MusicAction, a music production development and support program, and to the operations of major music events such as the Festival de musique in Granby, the ADISQ Gala and so on.
What our broadcasters are asking Parliament for is complete exemption for the radio industry. Parliament must have regard to the importance of radio as an instrument for marketing music and maintaining awareness of the repertoire among radio listeners.
The U.S. Congress clearly understood the interconnectedness of the music and radio industries when it exempted radio from paying for any neighbouring rights. In so doing, the U.S. Congress stated that it was convinced that it was striking a balance between these two partners.
The structure of their broadcasting systems in the industrialized countries that have introduced neighbouring rights is very different from the systems in Canada and the United States. In North America, we emphasize local service with smaller firms, in competition, which serve local communities spread over a large geographic area.
In Europe, the legislators have tended toward establishing large national stations or networks offering national services from which stations may break away during certain periods to offer a local service. In general, those break-away periods occur when the listening audience is at its lowest. These large stations and networks have economic resources out of proportion to virtually any Canadian and Quebec radio stations.
In return for the exemption, French-language broadcasters have demonstrated their commitment to maintaining their level of financial contributions to MusicAction, so that the players in the music industry can invest in new products, develop new talent and ensure the growth of that industry. In addition, they have committed themselves to institutionalizing promotional practices for the benefit of the music industry.
By introducing neighbouring rights, Parliament will be creating another mechanism, like the collective public performance society, which will end up creating negative cash flows for Canada, while a program like MusicAction invests all of its funds in Canada, under public policies for the benefit of the Canadian music industry.
.1205
We shall not hide the fact that these contributions are in jeopardy in view of the fact that the people who benefit from them are the same people who will be collecting neighbouring rights. The general organization of the radio industry is unable to maintain two systems of contribution, one statutory and the other voluntary.
Complete exemption for paying for neighbouring rights will also benefit local communities, since radio firms which have, in Quebec and elsewhere in Canada, suffered pressures from the increased competition from the other media, the significant drop in advertising dollars, particularly for AM band radio stations, and the economic difficulties endured by the country in recent years, will not have to engage in further restructuring to counteract new costs that they are unable to reduce.
If, despite our request, Parliament still wishes to introduce provisions relating to neighbouring rights that would apply to radio, we would invite Parliament to consider the following questions.
There is real danger in applying a foreign model that does not take Canadian or Quebec economic reality into account. In the opinion of the ACRTF, Parliament must take into account the existing disparity that currently exists between the musical royalty rates paid in Canada and various other countries to determine the real cost of the music provisions in the bill. Thus the provisions of clause 90 of the bill are unacceptable to us for the following reasons. In our opinion, Parliament should leave it up to the Copyright Board alone to determine the total cost of music. You will find appended all our recommendations.
In the United States, radio stations pay an annual royalty equivalent to 2.8% of their advertising revenues for public performance and the right to make copies for their own use, while in Canada that percentage would be 3.2% for public performance. The reproduction fees now being sought by various entities would have to be added. These entities estimate that reproduction fees should amount to 1.8% of radio advertising revenues, for a total cost of 5% of advertising revenues solely for the benefit of authors, composers and music publishers. We will get back to reproduction fees in a few minutes.
In France, SACEM, the collective society that administers public performance rights, collected from all French radio stations for 1994 approximately F.F. 70 million or $18.4 million while in Canada, SOCAN, for the same period, collected $20.7 million from Canadian radio. A per capital comparison of the royalties paid shows that French radio stations paid 33 cents per capita while Canadian radio stations paid 77 cents.
The instructions given by Parliament to the Copyright Board must take into account the actual use of copyright works in terms of neighbouring rights. It is imperative that the instructions described in sub-paragraph 68(2)(a)(i) in the bill mean that after establishing the tariff for neighbouring rights the Board will also determine the volume of the repertoire actually used by all radio firms in Canada. Only after doing these calculations, can fees for neighbouring rights be determined.
In accordance with the regulations and policies of the CRTC, French-language broadcasters must broadcast a minimum of 65% of French-language vocal works, while English-language broadcasters have no language-related obligation. This distinction between the two components of the Canadian broadcasting system allows English language broadcasters to program a majority of musical works that are not subject to the terms of the concept of neighbouring rights.
Having regard to the regulatory difference that is now in place, a system for collecting royalties that took into account actual use of the subject repertoire would be to the detriment of the French-language broadcasting sector of the Canadian broadcasting system. To prevent placing this additional burden on French-language radio, it is imperative that the instructions set out in sub-paragraph 68(2)a)ii indeed mean this.
.1210
The ACRTF recommends, in the alternative, in the event that Parliament decided that neighbouring rights would continue to apply to radio, that the instructions given to the Copyright Board in the Act give it all the flexibility it requires in order to establish the cost of music to radio, ensure that the tariff for neighbouring rights is based on actual use of the subject music and ensure that French-language radio is not penalized in comparison to English-language radio.
Mr. Bernard Guérin (Legal Advisor to Télé-Métropole, Association canadienne de la radio et de la télévision de langue française): I'll skip to the matter of the exception to ephemeral recording and transposition rights. These questions are primordial for radio broadcasters in the ACRTF as they are all directly affected by that.
The Chair: As we have already received the brief, I hope that you will summarize it which will allow us to have the maximum possible time to allow you to convince the members.
Mr. Guérin: Certainly. I will try to summarize. All members of the ACRTF are directly affected by a series of procedures undertaken by SODRAC, the Society for reproduction rights in Canada. SODRAC, whose members are all members of SOCAN, the society which administers the right of public performance, is trying, in our opinion, to make hay of a judgement handed down by the Supreme Court of Canada in August 1990, Télé-Métropole Inc. v. Michael Bishop.
In this decision, it was stated that a recording made to any end, even though none prejudicial to the copyright holder, without previous authorization of the copyright holder was a violation of his rights. Current legislation does not forbid the practice of prerecording but only obliges the broadcaster to obtain previous authorization from the holder. The Supreme Court added in its decision that ephemeral recordings are very useful to broadcasters who use them a lot.
In many countries where the right to make ephemeral recordings is recognized by legislation as being an accessory - I would even say a necessary accessory to broadcasting performances - conditions are imposed upon broadcasters concerning the length of their conservation and their use.
The Supreme Court, in its decision, stated that it was up to Parliament to take whatever measures are necessary to respond to numerous public interventions on this primordial matter.
After the Bishop decision handed down in 1990, the government communiques mentioned, and I have one here from March 1992, that the legislation would include an exception for ephemeral rights. I insist on the fact that discussions and different reports went on and were written both during and after the Bishop decision. At this point in time, this exception is not to be found in the bill as tabled.
As for SODRAC, it has been more vigilant. Even though it was not party to the request that led to the Supreme Court's decision, it rapidly engaged in a showdown with the French-language television and radio broadcasters.
In the television sector, SODRAC obtained the signature of agreements in an atmosphere of uncertainty and pressure more particularly by using injunctions after the Supreme Court decision and a first agreement with the Société Radio-Canada, this agreement having been signed in March 1992.
These agreements were entered in a context where French-language television broadcasters were of an opinion that they would elapse with the rapid adoption of the exception concerning ephemeral recording.
I would like to say that in our opinion, these agreements were essentially temporary and provisional measures and that we always thought there would be an exception for ephemeral rights and that only the terms and conditions of that exception would be left to be discussed.
That is the context in which we provided for provisions concerning legislative changes in the agreements entered with SODRAC.
.1215
More specifically in the case of Télé-Métropole, the most recent agreement expired last August 31 and, against all expectations, last August 22, demands representing an increase of over 400% were made by SODRAC.
I wish to emphasize that during the course of the negotiations, SODRAC's demands did come down but a considerable gap still remains.
In the vast majority of cases, the reproduction of works is a necessary incident. It's really to facilitate the broadcasting of programs in a way that these exceptions do not create any new commercial use. It's strictly for technical reasons. There is no additional financial gain for the radio broadcasters.
Moreover, and this has already been pointed out, copyright holders are already paid performance rights by the broadcasters for their works. In Canada, the copyright holders received over 46.4 million dollars for 1994 from commercial radio and television.
In the radio sector, after a formal notice sent to all Quebec radio stations and difficult negotiations concerning the importance and the real value of the repertoire presented by SODRAC, the latter, on December 4, 1995, filed a request in the Quebec superior court forbidding the recording and broadcasting of works in its repertory. This application comes with a claim for $1.320 million from Radiomutuel, Télémédia Communications and Radiomédia.
As we speak, the broadcasters involved, while preparing their defence, are of the opinion that the solution to their problems is of a legislative nature and that exceptions concerning ephemeral recording and transposition rights are the preferred solution.
We wish to emphasize that this approach is consistent with the Berne Convention that Canada and 25 other countries at least have signed to date, five of them being G-7 countries and more particularly the USA. We believe that Canada should be among them.
As examples of programs which would be significantly disadvantaged if the ephemeral recording exception was not adopted, thus entailing major administrative costs and serious competitive disadvantages with the United States for example, we could mention programs where the choice of the performer is determined according to his or her availability or current events, therefore programs based on current daily reality, certain public affairs programs, soap operas and other such productions which are prerecorded essentially because of production constraints.
In all the examples we have listed, it is difficult to determine before hand the music used. For all practical purposes, it is very difficult, if not impossible, to obtain a release from musical rights in good time, thus placing us in a situation where a release from musical rights can be obtained only after the program, which is a totally unacceptable negotiating position.
That is why we are asking the legislator to recognize the need for an exception to ephemeral recording and to the right to technological transposition, and for such exceptions to apply to proceedings begun after the date when the clause in question comes into effect and also to proceedings underway at that same date.
Lastly, we request that clause 32.1 exempting the making of copies for broadcasting purposes also refer to the decisions of the Copyrights Board handed down in accordance with the provisions of the Copyright Act, and that steps be taken to ensure that the exception also applies to proceedings begun after the date on which the clause in question came into force and also to proceedings underway at that date.
Mr. Charles Bélanger (Treasurer, Association canadienne de la radio et de la télévision de langue française): Mr. Chairman, I will take 30 seconds to talk about parody, pastiche and caricature.
As we know, humour is one of the staples of the airways, be it on radio or television, but some people don't find this funny.
Mr. Bélanger (Ottawa - Vanier): Yes, exactly.
Mr. C. Bélanger: When you read the brief, our recommendation is clear and unambiguous. We want certain benefits available in other countries to be also given to Canadian broadcasters. I shall not read the whole text, but I would stress that this is an important point which the committee should take into account.
.1220
The Chairman: Thank you very much, Mr. Bélanger, Mr. Arpin and Mr. Guérin.
We will now move on to question period. Mr. Leroux, you have five minutes.
Mr. Leroux: I read very carefully the brief you submitted and took note of all your arguments. When the minister appeared last week, I pointed out the following: As regards copyright and neighbouring rights, I have the impression that a piece of legislation has been introduced which is creating major losers instead of focusing on the future and encouraging people to take over from the present generation.
As regards authors, there are 13 pages telling them that they have no rights. In the case of neighbouring rights, I hear things such as: There must be exemptions, exceptions must be created, etc. It's as if we no longer thought that the agencies and organizations established to oversee this whole issue... Basically, the necessary thrust is not being shown.
I would first like to clarify certain points because I think they are important. I said earlier to Mr. McCabe that we received documentation from the beginning. All our colleagues received ample documentation. You are members of the association which, at one point, told us that this bill made no sense, that all the money would go to the United States, that we would be feeding the United States, whereas it is clearly recognized that neighbouring rights are not paid to a country which is not a member and has not signed the convention.
We had the impression that everyone was being told that we were going to pay neighbouring rights. I was annoyed about all of that. Moreover, as I said to you, I don't like it when incorrect information is given to us.
Mr. Arpin, when you talk about MusicAction, can we make a distinction between what comes under the CRTC and those areas concerning rights and copyright holders rather than neighbouring rights?
As regards television, the 5% established by the CRTC with respect to cable companies goes to community television. You consider that this money is used for development purposes. I would not like to be told one day that the CRTC had to get rid of its 5% and its ground rules. We need fully accurate information in order to understand the situation and avoid mixing things up.
Mr. Arpin, you made a comment concerning the francophone community, and I would like your comments on clause 68 of the bill. I would like you to talk about the clause which stipulates that, because of different requirements concerning language and content imposed as a result of Canadian broadcasting policy laid out in section 3 of the Broadcasting Act, the tariffs will have a negative impact on certain users subject to this legislation.
I'd like you to tell me whether this clause does not somewhat contradict what you were saying earlier, namely that the francophone market will be in trouble because of it.
Mr. Arpin: If I may, I will begin with your last question.
In my brief, I said that it had to be clearly understood that what we read corresponded closely to what we thought. I agree with your interpretation. In fact, subsection 68(2) provides protection to French-language radio.
I am counting on you not to amend that in clause-by-clause consideration of the bill. I am speaking here to all the members of the committee. I am answering the question asked by Mr. Leroux. Henceforth, I will address my remarks to the Chair. Mr. Chairman, I count on you and your colleagues to ensure that the bill continues to say what it says.
The assistance fund for cable broadcasting, the 5% to which you referred, is not paid by television broadcasters. It is paid by cable distributers, except that MusicAction is paid by radio broadcasters. There is a major distinction here.
Mr. Leroux: But it is the cable distributors who pay for community television.
.1225
Mr. Arpin: We are not distributors, but broadcasters. The Broadcasting Act makes a distinction between retransmission undertakings, that is cable distributing companies, and broadcasting undertakings, that is radio, television, specialized channels and networks. As regards statutory obligations imposed on broadcasting undertakings similar to MusicAction, only the radio industry is obliged to assume that kind of cost.
Television, specialized channels and public television have access to the public funds of Téléfilm, which come from the cable distribution fund. Therefore, we should not mix this up with retransmitters who have created a fund to assist Canadian production.
Mr. Leroux: Everybody has obligations.
Mr. Arpin: Everybody has obligations, but they are not of the same kind. Radio stations pay, television stations receive and must produce. They have production obligations.
Mr. Leroux: And that doesn't cost anything?
Mr. Arpin: Not to the television broadcasters.
You spoke to me about threats. We're talking about the same copyright holders. The Canadian portion of neighbouring rights will have the same copyright holders has those benefitting from MusicAction. Unfortunately, money doesn't grow on trees. It is quite a scarce resource. It will not be possible to impose both a legislative obligation and also a voluntary obligation on the same person.
We are saying that MusicAction meets certain objectives of both Canada and Quebec.
With respect to the United States, I would say that it is true that this country does not recognize the Rome Convention with respect to neighbouring rights and that it should not receive any contributions. However, the Americans maintain that under NAFTA, they are entitled to their share.
The Act was not clear on this issue. The bill remains murky about the exclusion of NAFTA partners. So that is not reassuring.
[English]
The Chairman: Mr. Abbott.
Mr. Abbott: In your presentation you did speak about the differences between your concerns in Quebec and the concerns that had been expressed previously. I apologize that I'm not really clear.
I'd like to give you the opportunity to distil for me if you could, in the next one or two minutes, what unique concerns you have in Quebec in French-language broadcasting that are unique to you by comparison with the presentation we just had from the CAB and the concerns outside of Quebec.
Mr. Arpin: The first one I will draw your attention to is that in Quebec there is a collective organization for the time-shifting right that the CAB addressed. In English Canada there are some organizational bodies, there are some agents, but there's no collective society.
In Quebec we have SODRAC, which is a collective organization whose sole aim is to collect revenue from the broadcasters and from other sources for the clearance of music. They're looking to issue blanket licences or to license each of the music parts of their repertoire on a one-by-one basis.
.1230
SODRAC has been very aggressive over the last five years, particularly after the Supreme Court decision of 1990 we referred to earlier, the Bishop case. SODRAC has reached some agreements with the television broadcasters by twisting their arms. They're now trying to negotiate with the radio broadcasters, and they are suing radio broadcasters for the right to play the music of their repertoire.
The beneficiaries of SODRAC are the same as SOCAN. It's like the game Monopoly: they're trying to pass Go and collect $200 for a second time. That basically is the main concern we have with regard to a federal transfer of technology right.
With regard to neighbouring rights, as I said to a member earlier, the bill as drafted takes care of the francophone concern. What I'm saying is don't change its meaning.
The Chairman: Mr. Abbott, very briefly.
Mr. Abbott: That's fine, thank you very much.
The Chairman: The Liberal side wants to split its questions. Ms Phinney, and then Mr. Bélanger.
Ms Phinney (Hamilton Mountain): Thank you you for joining us here today.
Could you give me some figures? How many radio stations are in your association right now?
Mr. Arpin: There are 80 private radio stations in the province of Quebec, and 70 of them are members of our association.
Ms Phinney: How many of them would have revenue under $1.25 million?
Mr. Arpin: I would say 50 of them. Now, there is no private information; I'm only making a guestimate.
Ms Phinney: How many of those 50 small stations - it sounds like an absurd question - would close or be affected by paying $100?
Mr. Arpin: I hope none of them would be affected by having to pay an extra $100. But you'd be amazed that most of those small stations are already losing money, so you're taking an extra $100 of expenses directly out of their bottom line.
Ms Phinney: How many of those 50 would be owned by one of the large stations?
Mr. Arpin: By a large group? It would be hard to give you a number, but we'll say 20% of them. We're talking 50 small stations, so 20% would be 10 of them that would be owned by larger corporations and 40 of them would be independent or small groups not owned by the major groups.
Mr. Leroux alluded to his riding, which has Radio des Appalaches. They have five or six small stations. It's a group, but all of their stations except maybe one would be under that $1.25 million. So they're not owned by a major group.
[Translation]
The Chairman: Mr. Bélanger.
Mr. Bélanger (Ottawa - Vanier): You are suggesting, Mr. Arpin, that neighbouring rights are not applying chiefly to radio. I would like to know to what they should apply, in your view.
Mr. Arpin: To the Internet.
Mr. Bélanger (Ottawa - Vanier): Explain to me how you would collect royalties. Do you think the introduction of neighbouring rights could be advantageous to the music industry, and that some artists who are not Canadian could consider coming to record in Canada, because they would benefit from the fact that Canada signed the Rome Convention?
Third, I would like to come back to the question of humour, pastiche and caricature. Would the exemption you are requesting apply as well to recordings by groups such as the Cyniques, Sol and Rock and Belles Oreilles? Would the exemption apply to cases of this type as well?
.1235
Mr. Arpin: I will start with your last question. Clearly, when the Cyniques or Sol create works, they are original. So these works are protected by copyright.
We are referring to humorous sketches of the type found on programs such as Bye Bye, the Royal Canadian Air Farce or some radio programs whose humour uses song and changes their words. Often, their routine may last only 50 seconds. It is not used for commercial purposes. I would understand that in the case of the commercial use, the authorization of the rights holders would be required.
Mr. Bélanger (Ottawa - Vanier): Once the piece in question is broadcast, does this not become a commercial use?
Mr. Arpin: If you like, but the program is not resold. It is used for broadcasting purposes only. Hence, the United Kingdom and the United States have exempted this procedure from their legislation. Each uses a different approach, however, and the French model is the clearest. The French legislation states that this type of programming is exempt.
The Chairman: We have seven minutes left. Mr. Leroux.
Mr. Leroux: First of all, I would like to hear more about ephemeral recording and how this would apply and to what. Would it apply to talk shows or to reruns? I think that is an important problem. Reruns are often shown during the summer. A tape of recorded music is often played throughout the night. I would like to hear what you have to say about this issue.
Second, you spoke about the flexibility of the Copyright Board and the value you attached to this body at the moment. The Copyright Board establishes tariffs according to the ability to pay, and that is a basic principle. The ability to pay must be determined before the scale is established, and so on. Moreover, you were saying as well that we should not necessarily copy foreign models. Do you believe in your ability to be original and to come up with a model geared to our market and our players?
I would like to hear what you have to say on these two matters.
Mr. Arpin: I will start with your last question because I will share my time with Mr. Guérin on the question of ephemeral recording.
The bill states that the cost of music is the cost of authors-composers, the cost of the performance, including public performance of the copy. The reason is that we will always have to pay something because the work will be used for longer than the six-month period we are requesting, that is the cost of neighbouring rights. So the cost of music is the total of all these rights.
Clause 90 states that nothing in the bill is supposed to prejudice public performance rate. Hence, there can't be no variation made in the value currently established for public performance rights.
We are saying that the Board must be able to set a fee on a music to be distributed to authors-composers for public performances and to music performers and makers. This would produce a sum, and the percentage that they would distribute among themselves, in accordance with the Board's decision.
However, we think that the percentage, in the case of radio, should not exceed 3.2 per cent. I am not saying the figure should be 3.2 per cent. I am saying that this must be seen as a whole. The Board must assign a value to all of the music used and to all these rights holders, and not merely pile one thing on top of the other.
There is a very important point here. We recognize at the outset, and my colleague will confirm this, that we are asking for an ephemeral right, but one that goes beyond the ephemeral. There are some audiovisual works that last for more than six months. Let me take the example of La petite vie, which was produced some time ago and is presented almost every year.
.1240
Mr. Leroux: Other examples are Cha Ba Da, Les amuse-gueules, hosted by Jean-Pierre Coallier, and so on.
Mr. Arpin: Some products last six months and even less, and others last longer. We certainly understand that we will have to get the necessary authorization from the rights holders for anything beyond six months.
Within the six-month period, we could use the work in accordance with current broadcasting practices.
Mr. Guérin: All our proposed wording would apply to all types of programs, whether talk shows or news, and would include reruns. While it does not happen often, sometimes programs are rebroadcast within the six-month time frame. However, for any rerun outside the six-month period, there should be a release of mechanical reproduction rights. We are really requesting an exception.
Mr. Arpin: Let me give you the best example. I am thinking of Musique Plus or MuchMusic, which have eight hours of original programming every day, with two repeats. The exception regarding ephemeral recording would apply to these two repeats.
The Chairman: Mr. Bélanger, I will give you the floor to make one final comment.
Mr. Bélanger (Ottawa-Vanier): I would like to know whether you think the introduction of neighbouring rights might be beneficial to the music industry. That was my second question earlier.
Mr. Arpin: If foreign producers were to come and produce their works in Canada... I think the question is more hypothetical than realistic, because our studio costs are already lower than in the United States. There has been some production work done in Morin Heights, but the volume is not very significant. I don't think the neighbouring rights would give Michael Jackson so much money that he would travel from Los Angels to Morin Heights or Toronto to produce a recording.
Mr. Bélanger (Ottawa-Vanier): I see. You said that this should apply to the Internet. I would like to hear a little more about that.
You just mentioned the classic example of ephemeral rights, the 24-hour period. We're not talking about six months. Examples for the preceding group were very brief, they were not for six-month periods. We're not talking about shifting seasons, but rather days.
Mr. Guérin: Many weekly episodes of serials are produced all at once because of production costs. A whole season of a television is produced in the same place with the same artists over a one or two-week period.
Mr. Bélanger (Ottawa-Vanier): But I'm talking about radio.
Mr. Guérin: I am sorry.
Mr. Arpin: Ephemeral recording on radio is probably much more limited within a relatively brief period of time. The main issue on radio is technological transposition rights. There is time shifting as well, and you were given some examples of it this morning. However, the question of ephemeral recording is of greater concern to the television sector.
Since Parliament often sees broadcasting as a whole, radio and television are covered by the same legislation. That is why we are making a joint presentation.
Mr. Leroux: In your brief, you are asking something important of us, as members of Parliament. You are asking that the bill be amended to block any court action with respect to fixation or reproduction for any period prior to the passage of the bill. Are you not thereby asking that the case pending before the courts between SODRAC and your members be declared null and void?
Mr. Arpin: Absolutely.
Mr. Leroux: That is what you are asking us to do.
Mr. Arpin: Yes.
The Chairman: We would like to thank you, Mr. Arpin, Mr. Guérin and Mr. Bélanger, for coming before us to express your views. We appreciated your presentation.
Mr. Bélanger (Ottawa-Vanier): Before someone on the committee accuses me of conflict of interest, I would like to point out that Mr. Bélanger and I are not related. Thank you.
.1245
.1247
[English]
The Chairman: Could I have order please?
I'd like to introduce the members of the Canadian Cable Television Association - the CCTA - appearing before us today: Mr. Jay Thomson, vice-president of legal and regulatory affairs; and Mr. Mike Eisen, counsel from the firm Morris, Rose, Ledgett of Toronto.
Mr. Thomson, the floor is yours.
Mr. Jay Thomson (Vice-President, Legal and Regulatory Affairs, Canadian Cable Television Association): Thank you, Mr. Chairman.
The Chairman: You followed what went on there. You have approximately 45 minutes, or until 1:30 p.m. The more brief your remarks are, the better the chances are for members to question you.
Mr. Thomson: Very good. I think my remarks will be brief.
As the chairman said, with me is Mike Eisen, who is CCTA's outside counsel. He represents us on copyright matters.
I thank you for the opportunity to appear before you today on the matter of Bill C-32. CCTA generally supports the bill. Nevertheless, as set out in our written submissions, we have four areas of concern that we would like this committee to consider and hopefully address when the bill is returned to the House.
At the outset, I'd like to point out that the members of the CCTA, as cable operators, are both users and creators of copyrightable works. As users, we currently pay over $40 million annually in distant signal retransmission royalties, and will soon be paying SOCAN millions of dollars each year for the use of music on pay television and specialty services. I say ``soon'' because this is a matter that is currently the subject of legal proceedings, an issue I will address shortly.
.1250
Before I touch on that matter, I would also like to say that we are creators too, because we operate and program the cable community channel. There are aspects of the bill - more correctly, there are omissions in the bill - that will have an impact on the community channel, and I hope to address those briefly as well.
I mentioned the legal proceedings that are currently under way involving ourselves and SOCAN. This is over the matter of SOCAN's so-called tariff 17. Under tariff 17, distributors such as cable operators are to pay SOCAN for the use of the music portion of programs carried on specialty services and pay television services - specialty services such as MuchMusic, Musique Plus, the Arts and Entertainment Network, and TSN; and pay television services such as The Family Channel, SuperÉcran, and The Movie Network.
There is a long history to legal proceedings relating to this tariff; however, it appeared most of the issues were resolved. Last spring the Copyright Board finally issued a decision establishing the level of royalties payable to SOCAN dating back to 1990. Unfortunately for SOCAN and its members, however, they are still not receiving royalties. Why? Because the Copyright Board, in establishing how much in royalties should be paid, did not determine who should pay them.
The Copyright Act, as maintained in Bill C-32, establishes that tariff 17 liability is to be shared jointly between cable operators and especially pay television service providers. This makes perfect sense, because it is the service providers who pick the music they include in their programs. Cable operators merely transmit those services with the music already in place.
However, having established that the liability is to be shared, the act then fails to establish how it is to be shared. Because the act does not clearly state that the Copyright Board has the power to determine how much of the tariff cable should pay and how much the service provider should pay, the majority of the Copyright Board felt it did not have the jurisdiction to make that determination. As a result, we have a tariff to pay, but don't know how much should come from us and how much we should then look to the services to contribute. Without this knowledge, we can't pay SOCAN. We therefore have to go back to the Federal Court of Appeal to ask the court to return the decision back to the Copyright Board with instructions to establish the split between ourselves and the service providers.
There is an easy and practical solution to this problem, which is bound to arise again with each new version of tariff 17 that the board issues. The act already requires the board to determine the allocation of royalties paid amongst the distant signal collectives and the distant signal retransmission regime. It need only be amended to include similar language requiring the board to determine allocation of who pays the royalties for tariff 17.
I mentioned at the outset that there are problems in the bill for the cable community channel. Actually, it's not what's in the bill, but what's missing. The mandate of the community channel, as many of you who use it know, is to reflect the community back to itself. This involves, among other things, covering local parades, school concerts, fairs and music festivals. The World Trade Organization implementation act created a new performer's right, which is reinforced in Bill C-32. It requires anyone wishing to tape or broadcast a performer's performance to first get the performer's authorization. We support such a right, and we'd like to be able to respect it.
However, the way the right is structured, community channel operators wishing to broadcast their local Santa Claus parade, for example, would first have to get the authorization from every single band member in that parade. This, of course, would be incredibly onerous. For this reason, we would simply like the bill to establish that we can obtain such authorization from a spokesperson, such as the parade organizer. Otherwise the administrative burden associated with obtaining all the necessary releases will be too great for the volunteer-run channel, and these types of community channel programs will go uncovered.
Like broadcasters, the community channel often is required to tape performances for later showing. That's the nature of broadcasting in the 1990s. This taping is merely for convenience purposes and is not undertaken for any commercial gain in itself. Unfortunately, the current mechanical reproduction rights regime requires the clearing of rights and payment of royalties before such taping can take place.
Using my local Santa Claus parade example again, this means that before taping the Saturday parade so that it might be shown on the next Sunday, the volunteers at the community channel would have to find out every song that every marching band is going to play, call up CMRRA or SODRAC to clear the rights, if in fact either of those agencies actually represent the rights-holders, negotiate a fee for each song, and pay it. The same goes, for example, with any multicultural festival with music, or Canada Day festivities.
.1255
If the community channel is going to be able to continue to cover these types of events, then we need to have an ephemeral exemption included in Bill C-32. An ephemeral exemption would allow the taping of the parade for later showing without triggering mechanical reproduction rights. Royalties will still be paid for the broadcast of the music on the show, but the burden of clearing mechanical rights would be removed.
The broadcasters and the cable industry are in full agreement on the need for an ephemeral exemption. Where we do not agree with the broadcasters is on the communication signal right contained in Bill C-32. We support the right as currently structured and see no need or rationale for it to be expanded to cover retransmissions.
We'd be pleased to answer any questions on that matter, should members have them.
The Chairman: Thank you very much. I appreciate that you are so concise. It's appreciated by the members.
[Translation]
Are your ready, Mr. Leroux?
Mr. Leroux: Thank you for your presentation, which causes us to reflect on all the aspects of the bill. You ask how certain situations will be managed and how all will develop.
I would like you to tell me more about support for copyright with respect to the communications signal, to the extent that this right is limited to what is stated in the legislation and does not extend to rebroadcasting.
[English]
Mr. Thomson: This is the communication signal right. It -
[Translation]
Mr. Leroux: That is what you say in your brief. You ask that with respect to communications signals, copyright be limited to what is provided in the legislation, and not extended to rebroadcasts.
[English]
Mr. Thomson: As it's structured now it's consistent with the convention, in that it applies only to over-the-air broadcasting of signals. So if some renegade broadcaster were to try to pick up a broadcaster's signal for its own use, that would trigger the right, but it does not apply when a cable company, for example, takes a signal as authorized by the CRTC and retransmits it to its subscribers.
We think that's the way the right should be, just as it's structured in the act. The broadcasters would like it to be extended to transmission, and we see no reason why it should be, because for cable companies and for cable subscribers there's no value in the signal itself. Its just an electromagnetic buzz. What is important to cable and its subscribers is the content in the signal, and we're already paying royalties for that.
[Translation]
Mr. Leroux: Thank you, Mr. Chairman.
[English]
The Chairman: Mr. Abbott.
Mr. Abbott: I think your brief really comes to the same conclusion, or at least drives the same conclusion, as I've arrived at on Bill C-32, which is that we're basically overlaying minuscule, obtuse legislation on legislation that's probably second only to the Income Tax Act in complications and obscurities. Trying to work our way through your first example here is just classic. I feel it completely substantiates the observation I just made.
To come to performers' rights, you've raised the issue, but I'm just challenging the concept that someone in a marching band playing ``Happy Birthday'' by trumpet is going to challenge the cable company from the fact that they're one of the people in the marching band. Is that what you're saying about the Santa Claus parade?
Mr. Thomson: We certainly hope they would not. We certainly hope they would appreciate that the community channel is there to give them exposure they probably would otherwise not get. Nevertheless, do we proceed on the assumption that we can ignore the right because someone won't try to enforce it against us? I think the preference would be to act within the law right from the start.
.1300
Mr. Abbott: That's fine. Thank you.
The Chairman: Mr. Arseneault.
Mr. Arseneault (Restigouche - Chaleur): Thank you, Mr. Chairman. I have just a few points.
Are you familiar with the Bishop case in Quebec?
Mr. Thomson: Yes.
Mr. Arseneault: Do some of the interpretations apply to cable TV?
Mr. Mike Eisen (Legal Counsel, Canadian Cable Television Association): Yes, insofar as the case deals with principles of copyright law, it would of course apply to cable television.
Mr. Arseneault: To your knowledge, has the procedure of broadcasting special events changed after the ruling in the Bishop case? I'm talking now about hockey games, skating competitions, and the Olympics. You mentioned the Santa Claus parade. Has it changed anything?
Mr. Thomson: I think it has created a chilling effect, if you will, for the community channels. Historically, there are a number of types of programs the community channels made and of events they covered that they either are no longer covering or are covering with trepidation.
Mr. Arseneault: Would you have some information you could table with the committee to give evidence to show that has happened due to the Bishop case ruling?
Mr. Thomson: We certainly could get anecdotal evidence from our community channel operators and I could prepare a package for you if you'd like.
Mr. Arseneault: I could be wrong, but I'm not aware that the community channels have actually changed their style. They're still broadcasting a lot of these community events and there doesn't seem to be a challenge.
And I would suspect that because of the way the things are operating in the province of Quebec, it would be safe to assume that the procedures that are used in Quebec for a contractual agreement, a public agreement type of deal...they would do the same right across Canada.
Mr. Thomson: I think there's a problem with the way the right is administered, at least in English Canada.
Mr. Arseneault: Excuse me, there is no English Canada: it's Canada.
A voice: It's Canada.
Mr. Arseneault: In Quebec or other parts of Canada, it's....
Mr. Thomson: I take your point. Outside of Quebec, CMRRA is an agency that represents a number of publishers, but not every publisher. They're not really in a position to issue a blanket licence.
Mr. Arseneault: Could you see that as a solution? I think that if you are going to discuss picky little items on the Santa Claus parade, both sides of the equation will see that it doesn't make complete sense. I would suspect they will go with the idea of a blanket type of agreement. Wouldn't you? Wouldn't that be the solution?
Mr. Thomson: Yes, I think it would certainly reduce the administrative burden on the community channel. If we could rely on a blanket licence approach, we would be safe in assuming that in paying the royalties we would be free of any subsequent liability to some group that we didn't know was out there. Then, yes, that would probably be a good solution.
Mr. Arseneault: Would you prefer that solution?
Mr. Thomson: The problem is, though, in coming up with a blanket licence, how does one actually establish the value of this type of undertaking, of taking a performance and putting it on videotape for later showing, especially with respect to something like the community channel that is a non-profit, volunteer-run operation?
Mr. Arseneault: I think the group responsible for setting the rates would certainly take that into consideration. They've proven in the past that they've looked at the whole situation. More than likely, you being a lawyer and a negotiator as well, you would make your case and others would make the case for their side of the equation. I think it would probably balance out in the long run.
Mr. Thomson: Under the current regime this type of matter does not go before the board, but under a new regime perhaps it could.
Mr. Arseneault: Thank you.
The Chairman: Thank you, Mr. Arseneault.
Mr. Abbott, do you have any further questions? Monsieur Bélanger?
Mr. Bélanger (Ottawa - Vanier): You mentioned that the definition of the community channel is that it is non-profit.
Mr. Thomson: Yes.
Mr. Bélanger (Ottawa - Vanier): Are you asking for an ephemeral right or exemption for community channels only?
.1305
Mr. Thomson: We're only speaking with respect to our own operations, and our own operations as a broadcaster are limited to the community channels. I'm only speaking for the cable industry. We would like an ephemeral exemption for the community channel.
Mr. Bélanger (Ottawa - Vanier): But do you believe that the exemption should be applied across the board or only to community channels?
Mr. Thomson: I think the broadcasters can certainly make their case why it should apply to them.
Mr. Bélanger (Ottawa - Vanier): But you're not making that case.
Mr. Thomson: I don't work for them.
Mr. Bélanger (Ottawa - Vanier): You're not making that case.
Mr. Thomson: I'm not making that case on their behalf.
Mr. Bélanger (Ottawa - Vanier): All right. Why six months?
Mr. Thomson: I think six months is a fair length of time. The community channel, because of its nature, relies on repeats of programming. It does not have the amount of programming that it can use to broadcast 24 hours a day, seven days a week. It has different audiences it has to appeal to, different community groups. A year would probably be better given the nature of the community channel, but six months, I understand, is in between with respect to some of the other countries that have ephemeral exemptions.
Mr. Bélanger (Ottawa - Vanier): Does your association have an estimate of the amount of money represented by this exemption you request?
Mr. Thomson: No, we do not, because we've never been in a position to value the mechanical right itself.
Mr. Bélanger (Ottawa - Vanier): So you don't know the impact?
Mr. Thomson: We don't know the impact.
Mr. Bélanger (Ottawa - Vanier): So it could be huge or it could be rather nominal.
Mr. Thomson: Even if we're only talking about a nominal amount of money, that does not remove the administrative burden associated with clearing the rights, which for a community channel may be even more onerous than the financial burden.
Mr. Bélanger (Ottawa - Vanier): I want to get this straight. What your association is asking for really is to avoid a huge administrative burden.
Mr. Thomson: That's right.
Mr. Bélanger (Ottawa - Vanier): Thank you.
[Translation]
Mr. Leroux: I certainly understand your concerns, and I see what you would like to do. However, don't you think the exceptions you are requesting would mean that SODRAC would be eliminated from an area of negotiation? What would happen to the current agreements if it were to be excluded because of these exceptions? Four hundred thousand dollars may have been received from the broadcasters last year.
Everyone seems to be asking that there be no further negotiations, that the Act provide for everything, that there be exemptions here and exceptions there. What would happen with the whole system? I'm having trouble understanding.
[English]
Mr. Eisen: I think it's important to recognize the different categories of exemptions that are applicable in the case of copyright law. This is an exemption that I believe is recognized as appropriate internationally relating to making possible an activity. It's simply for the purposes of facilitating the operations of the community channel to enable it to do what it intends to do in a way that's going to benefit the community the most.
It doesn't, I don't believe, take money out of anybody's pocket. Supporting it doesn't endorse the proposition that rights holders aren't entitled to compensation. It simply recognizes that there are some situations in which the strict application of the law is not appropriate.
[Translation]
Mr. Leroux: I understand, but there is an underlying consideration here. There are organizations representing rights holders, radio broadcasters, and television broadcasters and there are negotiations involving these parties. We have a Copyright Board. People are always asking for little exceptions for particular cases here and there, and the result is that the Act is not allowed to play its real role.. which is to recognize everyone's rights, and to ensure that people negotiate.
Attempts are being made to include exceptions in the bill to remove the responsibility for negotiations involving representatives of certain interest groups and rights holders. That is my impression.
.1310
[English]
Mr. Eisen: I think, sir, that while I appreciate your observations, it is not possible to deal with exceptions per se. I think you have to recognize that there are a large number of exceptions that I understand are highly contentious.
There are other exceptions, such as the ephemeral rights exception, which I do not believe, as I mentioned before, are internationally contentious. I do not believe these result in the carving away of the rights of creators. I think they simply facilitate the operations of a business having a regard for the existing technology.
The Chairman: Mr. Eisen, just as a matter of clarification, following Mr. Bélanger's and Mr. Leroux's questions, I took it from you that you confirm Mr. Thomson's reply to Mr. Bélanger. As far as your organization goes, you're talking about an exception that could relate to community channels per se. Is that what you're saying? From your standpoint, you would focus this exception, if there was to be one, on community channels. Do you see this as feasible?
Mr. Eisen: I don't know that I can comment on Mr. Thomson's observations, except to endorse them. The comments that I was making, however, related to copyright law principals generally speaking. Without intending to make a case for anyone, they would be appropriate in whatever form you chose to apply them to the extent that the exemption being requested is genuinely related to the technological realities of the business in question. I think it's a matter of copyright law principle generally and international treaties. It's appropriate.
The Chairman: You are talking in the broad sense.
Mr. Eisen: I was, but it's but Mr. Thomson's -
The Chairman: I understand. I just wanted to clarify that. It seemed to me there was a dichotomy. I wanted to make sure where you came from. I understand your point of view.
[Translation]
Are there any other questions?
[English]
I'd like to thank you very much, Mr. Thomson, Mr. Eisen, for appearing before us and making your position clear to the members. Thank you very much.
The meeting is adjourned.
.1312
.1315
The Chairman: Order.
Mr. Abbott has asked me for additional time to discuss a matter that he wants to bring before the committee.
Mr. Abbott: Mr. Chairman, I don't know that we necessarily want to do it now, although I'm wide open to it.
I would like to move that the heritage committee have an extra meeting to discuss the issues raised in correspondence between Mr. Knopf and our chairman regarding our committee legal counsel. If we feel we have time to discuss that issue now, I would defeat this motion. But I would like to have a meeting about that. I think it would take fifteen minutes to half an hour.
The Chairman: As the members know, a motion of this kind is receivable. There's no reason why we shouldn't receive it. You have to give 48 hours' notice unless the members give their consent to discuss it.
I am quite open either way. It will be up to the members to decide if they want to give consent to discuss it now or have a special meeting or add to one of the future meetings to discuss it afterwards, 48 hours after. I'm open to the members.
Monsieur Bélanger.
Mr. Bélanger (Ottawa - Vanier): Mr. Chairman, I would have no problem dealing with it now, but I think it is a matter that should be in camera because it deals with individuals and personalities.
The Chairman: You made a motion that it should be held in camera.
Ms Phinney.
Ms Phinney: I am making a statement in Question Period. I have to be out of here and over in Centre Block by half past.
Mr. Abbott: Mr. Chairman, I am not a procedural expert, but I wonder if we should be discussing my motion first and then dealing with the second motion.
The Chairman: First we have to decide whether there is consent to listen to your motion today or postpone it for 48 hours. Mr. Abbott makes a point; we have to deal with his motion first. At the same time, the members have a right to decide whether they want to deal with it in public or in camera. Mr. Bélanger says he's prepared to deal with it now, but he wants to deal with it in camera, which is his proper right -
Mr. Abbott: Why don't we treat Mr. Bélanger's motion as an amendment to my motion? That would simplify the whole issue, wouldn't it?
The Clerk of the Committee: No, in camera....
Mr. Abbott: I'm not interested in discussing the issue in camera.
Mr. Arseneault: I know you're not interested in discussing it in camera because you're interested in grandstanding. That's what you've done. We were ready to deal with it the other day and you left. You put forth some claim in public, before the meeting, when everyone was here, and then when it was time to discuss it you were nowhere to be found.
Mr. Abbott: I apologize. I really have no idea exactly what I said. I believe I was asking for an extra meeting, period. I don't believe that I -
Mr. Arseneault: - at that time and decided then whether an extra meeting was required.
The Chairman: Excuse me, members. I don't want any discussion back and forth.
I have the record. It says:
- In just 30 seconds I'll be asking for a separate meeting before our next Tuesday morning
meeting to discuss the issues that have been raised relative to our legal counsel on our
independent counsel here. So I'm just putting you on notice.
The motion to sit publicly or in camera will precede the other one because members have to decide which way they want to deal with it. The motion regarding whether it's public or in camera is up to the members to decide, and they can decide it without notice. In other words, they can make a motion. Mr. Bélanger has made a motion, so if there's discussion on it, let's have it now. Otherwise I will call for a vote on it.
.1320
Ms Phinney: We're not going to be postponing this, are we? Is this the beginning of the 48 hours' notice, or was the 48 hours' notice given two days ago?
The Chairman: No, no. There was no question about a notice of a motion, so it would be postponed by 48 hours unless the members consent to hear it right now.
Ms Phinney: So it's not a postponement. The rule is that you give notice 48 hours before you bring a motion to the committee, right?
The Chairman: Yes.
Ms Phinney: So it's not a postponement, it's the rule that you give 48 hours' notice.
The Chairman: That's correct.
Ms Phinney: I think we should go by that - the rule that you give 48 hours' notice. I think this should be the 48 hours' notice, and 48 hours from now we will discuss it.
The Chairman: Except, I mean that's up to us, but you have to have a special meeting then.
Ms Phinney: The only reason I mentioned that, Mr. Chairman, is because if we're going to start today to say we'll ignore the 48 hours' notice, somebody else is going to want to ignore the 48 hours next week, and somebody else the week after, and there will no 48 hours' notice.
Mr. Arseneault: The other point, Mr. Chairman, is that the topic Mr. Abbott wants to bring forth is a personnel matter, so it should be in camera - point number one. Number two, I believe the topic - if my memory is correct, and I don't have documentation with me - has been dealt with already by the chair in written format and was acceptable to me. The explanations you gave at that time were acceptable in letter form.
I don't see a need to have another whole meeting to discuss the old subject all over again. If Mr. Abbott has a motion to make as to what he wants done at that meeting, table it now, but just to have a motion to have another meeting to discuss things, where there's no clear evidence of what Mr. Abbott wants at the conclusion of the meeting.... I would ask that he table the motion he wants to present at that meeting, so we can have an idea of whether a meeting is necessary or not.
Does he want to fire someone, does he want to sanction someone, or does he just want to do nothing? We have to know. I came to a briefing by our researchers the other night, and I was very impressed with the quality of the brief. It's a very technical bill, and the manner in which it was explained was great. I didn't detect any bias. And I appreciate the way the chair has responded to some of the queries that have been made to the chair.
The Chairman: Mr. Arseneault, I appreciate everything you say. At the same time, there has been correspondence between Mr. Knopf and myself, and Mr. Abbott can present a motion to discuss that correspondence if he wishes to. The members can decide accordingly at the time.
Now, two things. First of all, there is very clearly no consent to discuss it today. It will have to be 48 hours from now. So we'll schedule a meeting 48 hours from now. As soon as time is available, we'll deal with it, 15 minutes before the start of another meeting or something. Members will be advised. That's number one.
Number two, we still have a motion by Mr. Bélanger as to whether we discuss that motion - because the clerk has to know - in camera or in public. We must deal with this before we leave today. So could I have a show of hands?
Motion agreed to [See Minutes of Proceedings]
The Chairman: So the meeting will be in camera and it will take place as soon as possible after 48 hours, and you will be advised.
The meeting stands adjourned.