The CRTC’s Chairperson – on CRTC independence and impartiality

In a letter to the editor in today’s Globe and Mail, CRTC Chairperson Konrad von Finckenstein denies that anyone in government has raised with him the Sun TV application, potential candidates for the position of CRTC Vice-Chair of Broadcasting, or his own term at the CRTC (which ends in 2012):

I would like to categorically state that no one at any level of government has approached me about the Sun TV application, the appointment of the CRTC's vice-chair of broadcasting, or my own mandate.

Working backwards from these statements, let’s assume that every level of government respects the CRTC’s theoretical decision-making independence.

(Theoretical, because we do not know whether the government’s ability to control the CRTC’s budget, the salaries it pays order-in-council appointees such as CRTC Commissioners and its ability to prematurely end Commissioner-ships, affects CRTC decision-making. Without evidence to the contrary it seems reasonable to assume in good faith that there is no relationship between complete financial control of an agency and complete control over the terms of the agency’s decision-makers, and the agency’s decisions.)

Under the CRTC Act, CRTC Commissioners are “appointed to hold office during good behaviour for a term not exceeding five years but may be removed at any time by the Governor in Council [i.e., the federal Cabinet] for cause.” Removal for cause implies that someone in the federal government must be assessing the performance of CRTC Commissioners, because without that assessment, no “cause” could be found on which to base an early end to a Commissioner’s term. Is it reasonable to believe that no one in the entire federal government has assessed the on-the-job performance of CRTC Commissioners, including the CRTC Chairperson (who is also a Commissioner)?

As for the issue of who will be appointed to fill the Vice-Chair’s position, it seems odd, to say the least, that the Chairperson – in law “the chief executive officer of the Commission” – would not be consulted about the appointment of the Vice-Chairperson of Broadcasting. If the Chairperson is absent or incapable of performing his duties, after all, the Vice-Chairperson might be asked to assume those responsibilities. Is it reasonable to believe that the government would appoint a Vice-Chairperson without any consultation whatsoever with the Chairperson as to the qualifications and ‘fit’ of the new appointee?

That leaves Sun TV. Quebecor representatives have held the following (reported) meetings with senior government officials since January 1st 2010:

July 28: Christian Paradis, Minister of natural resources
July 15: Tanya Peatt, Director of policy for the Minister of heritage
June 30: Josée Verner, Minister of intergovernmental affairs
May 3: Tanya Peatt, Director of policy for the Minister of heritage
April 23: Tanya Peatt, Director of policy for the Minister of heritage
April 19 Joanne McNamara, Chief of staff for the Minister of heritage
April 12 Michel Morin, CRTC Commissioner
March 29 Konrad von Finckenstein, CRTC Chairperson and Michel Arpin, CRTC Vice-Chairperson, Broadcasting
March 26 Tanya Peatt, Director of policy for the Minister of heritage
March 24 Tanya Peatt, Director of policy for the Minister of heritage
February 22 Tanya Peatt, Director of policy for the Minister of heritage
February 11 Konrad von Finckenstein, CRTC chairperson
January 27 Joel Bernard, Senior policy advisor to the Minister of industry
January 20 James Moore, Minister of Canadian heritage; Joanne McNamara, chief of staff to the Minister of Canadian heritage; and Judith A. Larocque, deputy minister of Canadian heritage
January 18 Joel Bernard, Senior policy advisor to the Minister of industry
January 11 Konrad von Finckenstein, CRTC chairperson; Michel Arpin, vice-Chairperson broadcasting

(This information is available at the website of the Commissioner of Lobbying: https://ocl-cal.gc.ca/app/secure/orl/lrrs/do/_ls63_ls6f_ls6d_ls6d_ls4c_l... . Type in ‘Quebecor’ in the “Client, Organization, or Corporation Associated with the Communication” box.)

Is it reasonable to believe that after 12 reported meetings between Quebecor representatives and two Cabinet ministers, the senior staff of those ministers and a deputy Minister of Canadian Heritage, no one in government has even breathed the words, “Sun TV” to the CRTC’s Chairperson? Not in passing. In a chance encounter in an elevator. Or at a cocktail party. At any time. The question to be asked, again, is what a reasonable person would believe.

One final point, concerning the treatment of the Quebecor application. The CRTC’s Chairperson says in his letter to the Globe and Mail that

Quebecor's application is being treated according to the CRTC's well-established processes. The application was published on Sept. 1 for comment, and a public hearing will be held in Gatineau, Que., starting on Nov. 19. The CRTC will then make a decision on the basis of the evidence on the public record.

The CRTC published the Quebecor application on September 1, and said it would consider the application at a public hearing on November 19 in Gatineau.

Quebecor has asked the CRTC for “a Category 2 licence with mandatory access granted for a maximum period of three (3) years” (Quebecor’s Supplementary Brief, page 1, paragraph 1.6). More specifically, Quebecor says it is not asking “for mandatory basic distribution, but only to be available on cable and satellite distribution undertakings allowing the public to have access to Sun TV news without any obligation to choose it” (page 8, paragraph 7.1)

Category 2 licences - mandatory – access – mandatory basic distribution – it all sounds so complex. What all these phrases involve is how cable and satellite companies (Broadcasting Distribution Undertakings, or BDUs) carry TV services.

For example, Category 2 TV services must negotiate with each BDU to get their service carried. This can be difficult – and most of the hundreds of Category 2 services that the CRTC has licensed in the last ten years haven’t launched.

But the CRTC can also require cable and satellite companies to carry certain TV services.

First, the CRTC can order a service to be carried as part of the basic cable or DTH package, using a power it has under section 9(1)(h) of the Broadcasting Act. Last month, on August 27th, the CRTC announced a moratorium on receiving any more 9(1)(h) applications until June 2012.

Second, the CRTC has also said that TV channels known as Category 1 services must be carried by cable and satellite companies, but not necessarily as part of the basic package. Last March the CRTC announced a moratorium on receiving any more Category 1 applications until October 2011.

Being carried in the basic cable or DTH package matters, because if you earn income from the fees paid by BDU subscribers, you will have access to the most subscribers and the most revenues. In 2009, for instance, TSN had 11,652,124 subscribers, and earned $122 million in subscriber fees. (You can find these data here: http://www.crtc.gc.ca/eng/stats4.htm.)

From this perspective, say you were the CRTC, and you had announced a freeze on receiving Category 1 applications in March, and on 9(1)(h) applications on August 27th. Would it be reasonable for you to announce four days later, on September 1st, that you will consider an application that wants some kind of mandatory access rights?

The problem with assessing whether Quebecor is being treated with “treated according to the CRTC's well-established processes” is that this application, as Quebecor itself says is “a new and first of a kind request” (Supplementary Brief, page 9). Does the CRTC have “well-established processes” for “new and first of a kind” applications? The CRTC’s current Rules of Procedure don’t describe such novel applications.

But reasonable Canadians may be asking themselves why an application that wants mandatory access rights of some kind is being considered, when everyone else has been told to wait until either 2011 or 2012. And that is why the CRTC Chairperson’s letter emphasizing the independence and impartiality of the CRTC is so interesting.