Corus asked BTLR to immediately change foreign ownership rules

Corus Entertainment Inc., the only major Canadian broadcaster refusing to make public its submission to the ongoing review of Canada’s communications laws, asked the government to move quickly to loosen restrictions on foreign ownership of broadcast assets. Corus did not allow its submission to be released through access to information, but The Wire Report obtained a summary of its arguments in a briefing note for Heritage Minister Pablo Rodriguez through a separate ATIP request. “Corus believes that the broadcasting sector cannot wait longer for legislative changes and therefore, considers that immediate, non-legislative measures must be taken,” reads a briefing note prepared for Rodriguez ahead of a February meeting with Corus head Doug Murphy. It outlined that the company asked the broadcasting and telecom review panel for three measures to be implemented immediately, and said that could most easily be done through the government’s powers to set a policy direction. Those recommendations include “relaxing restrictions on domestic media ownership.” Currently, the Broadcasting Act specifies that the broadcasting system must be owned and controlled by Canadians, meaning the company head, or similar, must be Canadian, no less than 80 per cent of the voting shares are held by Canadians, and the directors of the company must make up no less than that same per cent. Corus also recommended changing the digital media exemption order to require online services to make contributions to the broadcasting system, and “permitting greater broadcaster flexibility over content ownership and programming decisions.” The briefing note outlined that “Corus submitted that the panel should advise the Government that all policy and legislative options must be on the table as it undertakes this review process,” including allowing greater foreign ownership. “As the global media industry is being increasingly dominated by larger and larger entities, building scale and entering into new arrangements with foreign partners will be necessary for Canadian media as a matter of survival,” the note said in summarizing Corus’ position. Since a deal with BCE Inc. to buy Corus’ Historia and Series+ channels fell through after the Competition Bureau refused to grant approval, Corus hasn’t announced another buyer. In discussing a theoretical sale of Corus a year ago, Canaccord Genuity analyst Aravinda Galappatthige pointed out rules about foreign ownership limiting potential buyers for Corus, while vertically integrated Canadian companies also face regulatory limits on what they can purchase. Shaw Communications Inc. sold its $548-million stake in Corus earlier this year to a syndicate of banks, which -- the Globe and Mail reported last week -- was expected to take a loss on lower demand on the original share price offer. According to the briefing note summary, Corus also said the panel should do away with the current Broadcasting Act altogether. “Corus is of the opinion that the panel should request authority to consider casting aside the current Act in its entirety and take the initiative to draft a new Act. Rather than providing a series of recommendations, the panel should prepare draft legislation in its final report.” Principles to be included in that new legislation include allowing greater foreign ownership of Canadian media, ensuring “equitable obligations from all parties in the system,” tools to fight piracy, preserving a “discrete Canadian rights market,” and promoting “flexible and outcomes-based regulation.” The interim report from the expert panel in charge of the review is due by June 30, when the all of the submissions received will be made public. — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Ahmad Hathout at ahatout@thewirereport.ca

Corus asked BTLR to immediately change foreign ownership rules

News | May 30, 2019

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Corus asked BTLR to immediately change foreign ownership rules

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