Canadian Radio-television and Telecommunications Commission (Re)

Canadian Radio-television and Telecommunications Commission (Re)
Court (s) Database
Federal Court of Appeal Decisions
Date
2010-07-07
Neutral citation
2010 FCA 178
File numbers
A-303-09
Notes
Reported Decision
Decision Content
Federal Court of Appeal
Cour d'appel fédérale
Date: 20100707
Docket: A-303-09
Citation: 2010 FCA 178
CORAM: NOËL J.A.
NADON J.A.
DAWSON J.A.
BETWEEN:
IN THE MATTER OF THE BROADCASTING ACT, S.C. 1991, c. 11;
AND IN THE MATTER OF THE CANADIAN RADIO-TELEVISION
AND TELECOMMUNICATIONS COMMISSION’S BROADCASTING
REGULATORY POLICY CRTC 2009-329 AND BROADCASTING
ORDER CRTC 2009-452
AND IN THE MATTER OF AN APPLICATION BY WAY OF A
REFERENCE TO THE FEDERAL COURT OF APPEAL PURSUANT
TO SECTIONS 18.3(1) AND 28(2) OF THE FEDERAL COURTS ACT,
R.S.C. 1985, c. F-7
Heard at Ottawa, Ontario, on June 1, 2010.
Judgment delivered at Ottawa, Ontario, on July 7, 2010.
REASONS FOR JUDGMENT BY: NOËL J.A.
CONCURRED IN BY: NADON J.A.
DAWSON J.A.
Federal Court of Appeal
Cour d'appel fédérale
Date: 20100707
Docket: A-303-09
Citation: 2010 FCA 178
CORAM: NOËL J.A.
NADON J.A.
DAWSON J.A.
BETWEEN:
IN THE MATTER OF THE BROADCASTING ACT, S.C. 1991, c. 11;
AND IN THE MATTER OF THE CANADIAN RADIO-TELEVISION
AND TELECOMMUNICATIONS COMMISSION’S BROADCASTING
REGULATORY POLICY CRTC 2009-329 AND BROADCASTING
ORDER CRTC 2009-452
AND IN THE MATTER OF AN APPLICATION BY WAY OF A
REFERENCE TO THE FEDERAL COURT OF APPEAL PURSUANT
TO SECTIONS 18.3(1) AND 28(2) OF THE FEDERAL COURTS ACT,
R.S.C. 1985, c. F-7
REASONS FOR JUDGMENT
NOËL J.A.
[1] This is an application for a reference by the Canadian Radio-television and Telecommunications Commission (the CRTC). The question being referred is:
Do retail Internet service providers (ISPs) carry on, in whole or in part, “broadcasting undertakings” subject to the Broadcasting Act, [S.C. 1991, c. 11 (the Broadcasting Act)] when, in their role as ISPs, they provide access through the Internet to “broadcasting” requested by end-users?
The terms “broadcasting” and “broadcasting undertaking” are as defined in the Broadcasting Act as amended.
[2] Two groups take opposite views as to how this question should be answered. The Coalition, composed of Bell Aliant Regional Communications, LP, Bell Canada, Cogeco Cable Inc., MTS Allstream Inc., Rogers Communications Inc., Telus Communications Company and Videotron Ltd., along with Shaw Communications Inc. (Shaw) submit that the question should be answered in the negative.
[3] The Cultural Group, composed of the Alliance of Canadian Cinema, Television & Radio Artists (ACTRA), Canadian Film & Television Production Association (CFTPA), Directors Guild of Canada (DGC) and Writers Guild of Canada (WGC) argues that the question should be answered in the affirmative.
[4] In conformity with the order issued by this Court on July 31, 2009, the supporting affidavits and documentary exhibits filed by the members of the two groups, along with the affidavit of Namir Anani, Executive Director, Policy Development and Research at the CRTC, filed by the CRTC, are the materials that constitute the case to be determined on the reference pursuant to Rule 322 of the Federal Courts Rules, SOR/98-106.
[5] The statutory provisions that are relevant to the analysis are set out in the Annex appended to these reasons.
RELEVANT FACTS
[6] On May 17, 1999, the CRTC issued a report of broadcasting in new media: New Media, Broadcasting Public Notice CRTC 1999-84; Telecom Public Notice CRTC 99-14, Notice of Application of the CRTC, Tab A (the New Media Report). It concluded that while some new media services fell within the meaning of “broadcasting” in the Broadcasting Act, their regulation was not necessary to implement the Act’s broadcasting policy. By CRTC Public Notice 1999-197 (the New Media Exemption Order), the CRTC exempted those undertakings, classified as “new media broadcasting undertakings”, from any or all of the requirements of Part II of the Broadcasting Act and Regulations, pursuant to its powers under subsection 9(4) of the Broadcasting Act.
[7] On October 15, 2008, the CRTC issued Broadcasting Notice of Public Hearing CRTC 2008-11, initiating a public proceeding to determine, amongst other things, whether the New Media Exemption Order continued to be appropriate or needed to be revised.
[8] Having reviewed the legal opinions filed by the interested parties, the CRTC issued Broadcasting Regulatory Policy CRTC 2009-329 detailing its findings on June 4, 2009 (the 2009 CRTC Policy). In this Policy, the CRTC did not determine the issue as to whether ISPs are subject to the Broadcasting Act when they provide access to broadcasting through the Internet. Rather, the CRTC decided that it would refer the question to this Court for determination. The CRTC noted that the outcome of the reference is important to determine whether ISPs are subject to the New Media Exemption Order and whether the proposed amendments to impose reporting requirements and undue preference provisions would apply to them.
[9] On July 28, 2009, the CRTC issued Broadcasting Order CRTC 2009-452 (the Reference Order) ordering the referral of the question currently before this Court. The Reference Order also clarifies the context for the referral:
4. With respect to its determination to refer this matter to the Court, the Commission stated the following in its regulatory policy:
The issue of the applicability of the Act to ISPs was raised primarily in relation to the proposal by cultural groups in the Proceeding for a levy on ISPs to create a fund to support the creation and presentation of Canadian new media broadcasting content. Although the Commission has determined that funding (and, consequently, a levy) is neither necessary nor appropriate at this time, it considers that the question as to whether ISPs are subject to the Act must be resolved. If ISPs were subject to the Act, they would fall within the scope of the New Media Exemption Order given that it was intended to encompass all broadcasting undertakings whose services are delivered and accessed over the Internet. Accordingly, legal certainty with respect to the status of ISPs under the Act is necessary in order to know whether ISPs are subject to the New Media Exemption Order and, as such, whether the proposed amendments to that order to impose reporting requirements and undue preference provisions for new media broadcasting undertakings will apply to them.
The Commission notes that, pursuant to subsection 4(4) of the Broadcasting Act, a telecommunications common carrier, as defined in the Telecommunications Act, when acting solely in that capacity, is not subject to the Broadcasting Act. Likewise, pursuant to section 4 of the Telecommunications Act, that statute does not apply in respect of broadcasting by a broadcasting undertaking. The legal issue as to whether ISPs are subject to the Broadcasting Act raises fundamental questions regarding the distinction, for the purpose of the Broadcasting Act and the Telecommunications Act, between telecommunications common carriers and broadcasting undertakings.
[10] The CRTC, in referring the question to the Court, made a number of findings as to the workings of the Internet and the role of ISPs. The CRTC describes the Internet as a network of networks that allows for the communication of digital information. It is composed of interconnected computers usually called “hosts” and “routers”. Hosts, such as Internet users and content providers such as website servers, are end-systems that send and receive data while routers are network computers that relay data from host to host.
[11] Network providers, such as retail ISPs, are entities that deploy routers and other network infrastructure to interconnect their subscribers with the other networks that make up the Internet. In addition, ISPs generally provide their subscribers with hardware such as a modem and/or router to connect them to their network, as well as customer authentication (e.g. username and password).
[12] The CRTC defined ISPs in the Glossary of New Media Terms appended in the New Media Report:
A company or other organization which provides access to the Internet to its customers via one or a combination of dial-up lines (similar to telephone service), coaxial cable ISDN, xDSL or other dedicated lines. The most typical example is a home user who pays a fee to connect to the ISP’s server. The connection is made by a “modem” which makes the electronic data from the home user’s computer transmittable over a telephone line. The data then passes through the telephone company’s facilities in the same way as a normal telephone call. The “call” is received by the ISP which “routes” the user’s requests for information to the server that is “hosting” the desired data.
[13] In other words, ISPs provide the infrastructure to enable end-user subscribers to access the content, applications and services made available by others on the Internet. In order to access “broadcasting” through the Internet, the end-user must make use of the services of an ISP. In addition, content-providers depend on ISPs’ services for the delivery of their content to end-users. In their role as providers of “access through the Internet to “broadcasting” ”, ISPs do not select or originate programming or package or aggregate programming services.
[14] Although ISPs may perform these functions when they operate their own websites, the CRTC emphasized (Referral Order, paragraph 10) that this activity is separate and distinct from their role as ISPs which is to provide for the transmission of content requested by their end-users. The focus of the reference is restricted to this last function. ISPs fulfill this function using either their own facilities or facilities leased from another ISP, or a combination of both.
[15] ISPs which qualify as telecommunication common carriers are currently regulated under the Telecommunications Act, S.C. 1993, c. 38 (the Telecommunications Act) as providers of telecommunications services. The issue underlying the referred question is whether ISPs should be considered a “broadcasting undertaking” and regulated under the Broadcasting Act when they provide access to “broadcasting”.
[16] In the New Media Report which led to the New Media Exemption Order, the CRTC made a number of specific findings which support the assumption that “broadcasting” takes place on the Internet:
a. Information transmitted on the Internet is not thereby displayed in a public place and is not therefore excluded from the definition of “broadcasting”:
36. [The Commission] considers that the Internet is not in and of itself a "public place" in the sense intended by the Act. Programs are not transmitted to cyberspace, but through it, and are received in a physical place, e.g. in an office or home.
b. The fact that programs are transmitted to end-users by means of the Internet does not exclude the activity from the definition of “broadcasting”:
38. The Commission notes that the definition of "broadcasting" includes the transmission of programs, whether or not encrypted, by other means of telecommunication. This definition is, and was intended to be, technologically neutral. Accordingly, the mere fact that a program is delivered by means of the Internet, rather than by means of the airwaves or by a cable company, does not exclude it from the definition of "broadcasting".
c. The delivery of content over the Internet from a host server to end-users involves the “transmission” of the content:
39. The fact that an end-user activates the delivery of a program is not, in the Commission's view, determinative. As discussed below, on-demand delivery is included in the definition of "broadcasting". Further, the Commission considers that the particular technology used for the delivery of signals over the Internet cannot be determinative. Based on a plain meaning of the word, and recognizing the intent that the definition be technologically neutral, the Commission considers that the delivery of data signals from an origination point (e.g. a host server) to a reception point (e.g. an end-user's apparatus) by means of the Internet involves the "transmission" of the content.
d. The words “broadcasting receiving apparatus” include personal computers of Web TV boxes when used to access the Internet:
40. The Commission notes that the definition of "broadcasting receiving apparatus" includes a "device, or combination of devices, intended for or capable of being used for the reception of broadcasting". The Commission considers that an interpretation of this definition that includes only conventional televisions and radios is not supported by the plain meaning of the definition and would undermine the technological neutrality of the definition of "broadcasting". In the Commission's view, devices such as personal computers, or televisions equipped with Web TV boxes, fall within the definition of "broadcasting receiving apparatus" to the extent that they are or are capable of being used to receive broadcasting.
e. Programs which may be accessed by the end-user as and when the end-user accesses them are “for reception by the public”:
44. In the Commission's view, there is no explicit or implicit statutory requirement that broadcasting involve scheduled or simultaneous transmissions of programs. The Commission notes that the legislator could have, but did not, expressly exclude on-demand programs from the Act. As noted by one party, the mere ability of an end-user to select content on-demand does not by itself remove such content from the definition of broadcasting. The Commission considers that programs that are transmitted to members of the public on-demand are transmitted "for reception by the public".
f. Digital audio and video services transmitted over the Internet are “broadcasting”:
46. By contrast, the ability to select, for example, camera angles or background lighting would not by itself remove programs transmitted by means of the Internet from the definition of "broadcasting". The Commission notes that digital television can be expected to allow this more limited degree of customization. In these circumstances, where the experience of end-users with the program in question would be similar, if not the same, there is nonetheless a transmission of the program for reception by the public, and, therefore, such content would be "broadcasting". These types of programs would include, for example, those that consist of digital audio and video services.
THE PARTIES’ POSITIONS
The Coalition’s Position
[17] The Coalition submits that the reference question should be answered in the negative. It argues that the definition of “broadcasting undertaking” is to be interpreted in light of the object of the Broadcasting Act and it is evident that, by enabling end-users to access “broadcasting” through the Internet, ISPs fall outside of this definition. The definition of “broadcasting undertaking” is not exhaustive. However, unlike distribution and programming undertakings and networks, ISPs do not exercise any control over creating, choosing, or acquiring rights to the content that end-users receive. ISPs play no editorial role nor do they “receive” programs; rather, they simply provide a passive connection through which “programs” may travel. Indeed, the courts have consistently found ISPs to be mere conduits, analogous to telephone lines, and therefore not liable for copyright-infringing or defamatory content that is sent or accessed using their facilities.
[18] As the primary focus of the Broadcasting Act is to foster the enrichment of Canada via the broadcasting of programs that promote Canadian artistic creativity, expression and talent, the Coalition is of the view that its interpretation is in line with Parliament’s intent. As mere conduits, ISPs have no meaningful role to play in ensuring the attainment of these objectives. Parliament could not have intended to capture undertakings with the characteristics of ISPs. Rather, it is submitted that the function of the ISPs are at the core of the policy objectives of the Telecommunications Act.
[19] As recognized at section 28 of the Telecommunications Act, telecommunications carriers (including satellite carriers) may transmit broadcasting programming in their capacity as telecommunications carriers. The Coalition argues that the services offered by the ISPs are much like the satellite services provided by Telesat Canada or the Video Dial Tone services which the CRTC has maintained should be regulated under the Telecommunications Act. The Coalition submits that the function performed by ISPs in providing Internet access to end-users is consistent with the objectives of the Telecommunications Act to ensure the efficiency, accessibility and reliability of Canadian telecommunications and infrastructure.
Shaw’s Position
[20] Like the Coalition, Shaw also submits that the reference question should be answered in the negative. Broadcasting is restricted to the “transmission of programs, whether or not encrypted, by radio waves or other means of telecommunication for reception by the public by means of broadcasting receiving apparatus”. As ISPs do not engage in the “transmission of programs” for “reception by the public”, they do not engage in broadcasting.
[21] Shaw relies on the Supreme Court’s decision in Society of Composers, Authors and Music Publishers of Canada v. Canadian Assn. of Internet Providers, 2004 SCC 45, [2004] 2 S.C.R. 427, (CAIP). The Court found that, given their role as a mere conduit of information, ISPs do not communicate to the public pursuant to paragraph 2.4(1)(b) of the Copyright Act, R.S.C. 1985, c. C-42 (the Copyright Act). The Court also noted that its approach was comparable to that taken in Electric Despatch Co. of Toronto v. Bell Telephone Co. of Canada, (1891), 20 S.C.R. 83. (Electric Despatch) where the owner of the mode of transmission, in this case Bell, was found not to be engaged in the transmission itself. Shaw submits that, in accordance with the rules of statutory interpretation, since the acts deal with the same subject-matter and no contrary intention is apparent, the same interpretation of the word “transmission” is applicable under the Broadcasting Act.
[22] ISPs also do not telecommunicate for “reception by the public”. Indeed, the data conveyed by ISPs is done so exclusively to the user to whom the individual data packets are addressed. This is contrasted with content providers who typically make website content available to multiple users. Shaw relies on the Supreme Court’s decision in CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13, [2004] 1 S.C.R. 339 wherein the Court concluded that a single transmission to a single individual is not a communication to the public.
[23] More broadly, Shaw argues that ISPs are not “broadcasting undertakings” because there is no “broadcasting” when a content provider makes program content available over the Internet. Contrary to the unidirectional sending of telecommunications signals by a source to multiple passive recipients which constitutes the essence of broadcasting, Internet users request and receive data via an individualized communication with the source. Shaw relies on this Court’s decision in WIC TV Amalco Inc. v. ITV Technologies, Inc., 2005 FCA 96, (2003) 29 C.P.R. (4th) 182 where the distinction between broadcasting and web casting was recognized.
[24] Shaw argues that the Internet is not part of the “Canadian broadcasting system” that Parliament intended to regulate with the Broadcasting Act. Pursuant to paragraphs 3(1)(a) and (b) of the Broadcasting Act, the Canadian broadcasting system “shall be effectively owned and controlled by Canadians” and “makes use of radio frequencies that are public property”. Canadians do not “effectively own and control” the Internet and the Internet does not make use of “radio frequencies that are public property”. Furthermore, the express limitation that broadcasting be confined to the transmission of programs by means of “broadcasting receiving apparatus” excludes computers as found in R. v. Bahr, 2006 ABPC 360, 434 A.R. 1. The technological neutrality argument raised by the Cultural Group cannot override the legislative language or intent: Canadian Private Copying Collective v. Canadian Storage Media Alliance, 2004 FCA 424, [2005] 2 F.C.R. 654 at paragraphs 153 to 164.
[25] In any case, a finding that ISPs engage in broadcasting would be, it is argued, an untenable interpretation of the Broadcasting Act. Highly customizable content has been recognized by the CRTC not to constitute broadcasting. ISPs are unaware of the content of the data packets being relayed and have therefore no knowledge of whether the programs are customizable to a significant degree. They would have no idea when they were broadcasting and when they were not.
[26] As for the scope of the definition of “broadcasting undertakings”, Shaw contends that the use of the word “include” within this definition was not intended to permit the creation of undertakings beyond those already enumerated: “distribution undertaking”, “programming undertaking” and “network”. In light of their content-neutral role, Shaw, like the Coalition, argues that ISPs constitute none of those undertakings and that their traffic management practices do not change the nature of the transmission nor alter this conclusion.
The Cultural Group’s Position
[27] The Cultural Group contends that the reference question should be answered in the affirmative. It submits that, as assumed in the question posed by the CRTC, the delivery of audio and audiovisual content to ISP subscribers through the Internet is “broadcasting” as it involves the transmission of programs by means of telecommunications. Contrary to Shaw’s assertion, the fact that the Internet makes no use of public owned radio frequencies does not exclude it from the scope of the Broadcasting Act. Indeed, Parliament’s intent that the Broadcasting Act be technologically neutral was made clear during its review of Canadian broadcasting and telecommunications policy in the late 1980s.
[28] This transmission of programs is “for reception by the public” by a computer, or “broadcasting receiving apparatus” as recognized by the CRTC in the New Media Report at paragraphs 2 to 5. Furthermore, as evidenced by the deletion of the words “made on demand of a particular person for reception only by that person” in the final enactment of Bill C-40, the subscriber’s demand for the program does nothing to change the fact that its subsequent transmission constitutes broadcasting.
[29] Turning to the issue of whether ISPs can come within the definition of “broadcasting undertaking”, the Cultural Group notes that the word “includes” indicates that the definition is not limited to the undertakings enumerated. The CRTC need not bring ISPs within any particular class of broadcasting undertaking. ISPs need only constitute “undertakings” that engage in “broadcasting”, a criterion which they satisfy. Nevertheless, ISPs could be said to constitute “distribution undertakings”, “new media broadcasting undertakings” or be part of some new class of undertaking that the CRTC could create.
[30] With regard to the alleged passive nature of ISPs, the Cultural Group notes that subsection 2(1) of the Broadcasting Act makes no distinction between the active or passive nature of a “distribution undertaking” or “programming undertaking”. The underlying principles in the Supreme Court decisions Capital Cities Comm. v. C.R.T.C., [1978] 2 S.C.R. 141 (Capital Cities) and Public Service Board et al. v. Dionne et al., [1978] 2 S.C.R. 191 demonstrate that, as part of the single system which is the broadcasting system, ISPs are regulated by the Broadcasting Act along with the content of the programs they transmit. Parliament has not excluded transmission intermediaries from the definition of “broadcasting” based on their passive or active role. As such, the ISPs’ passive role is irrelevant to the application of the Broadcasting Act.
ANALYSIS
[31] The question as framed is based on the assumption that “broadcasting” takes place on the Internet. This assumption is based on a number of prior findings made by the CRTC, i.e. that the delivery of content on the Internet involves the “transmission” of the content; that computers constitute a “broadcasting receiving apparatus”; that the content transmitted on the Internet can be a “program” and that such transmission is “for reception by the public”.
[32] In its memorandum of fact and law, Shaw took issue with these findings. In particular Shaw challenged the fundamental assumption that “broadcasting” takes place on the Internet. However, at the hearing of the appeal, counsel for Shaw acknowledged that in dealing with the question, the Court must accept the assumption on which it is framed. He nevertheless expressed the concern that the Court might be viewed as sanctioning the underlying findings.
[33] To be clear, neither the assumption that “broadcasting” takes place on the Internet nor the underlying findings made by the CRTC are in issue in this proceeding with the result that the Court in answering the referred question cannot be viewed as making any pronouncement with regard to the assumption or any of these findings.
[34] Turning to the question, the parties expressed the common view during the hearing that the answer turns on whether ISPs, when providing access to “broadcasting”, are themselves “broadcasting”. Counsel for Shaw and for the Coalition conceded that if ISPs are thereby “broadcasting”, they must be viewed as “broadcasting undertakings”. If not, counsel for the Cultural Group agreed that the opposite conclusion must be reached.
[35] When regard is had to the wording of the definition, the issue to be decided is whether, when providing access to the “transmission of programs …”, ISPs are broadcasting. The answer to this question hinges on a consideration of the findings of the CRTC as to how programs are transmitted on the Internet on the one hand, and the exact purport of the definition of the word “broadcasting”, on the other.
[36] In the Reference Order, the CRTC provides a detailed explanation as to how “transmission” takes place on the Internet (Reference Order, paragraphs. 12 to 16):
12. For the purposes of transmission on the Internet, content is broken down into data packets. In order for an end-user to access content on the Internet, the end-user must send a request to a host server or network device. Data packets are transmitted from host servers or network devices via switches and routers, which examine the header information and determine the appropriate transmission route for the packets. Packets are transmitted through multiple routers until they reach the end-user’s ISP for delivery to the computer or other Internet aware device operated by the end-user.
13. ISPs enable end-users to access the Internet and enable the delivery of content through the Internet to end-users, as described above. To that end, the ISPs’ routers respond to end-user activity by routing data packets using Internet protocol. The functions and operations of ISPs do not generally differ according to the type of content being delivered to the end-user – whether it be alphanumeric, audio or audiovisual.
14. Source and destination Internet addresses for each packet are assigned by the end-user device and are not generally modified by ISPs. The ISP reads the packet’s header to determine the most appropriate transmission route. The ISP’s routers route packets of data sourced from or destined to an end-user’s computer or other Internet aware device. Upon reception of packets, the end-user device reassembles the packets of data and translates the data into a format which will be accessible to the end-user.
15. ISPs deploy routers and other network infrastructure to interconnect their subscribers with the other networks that make up the Internet. In addition, ISPs generally provide their subscribers with hardware such as a modem and/or router to connect them to their network, as well as customer authentication (e.g. username and password).
16. In order to access broadcasting through the Internet, the end-user must make use of the services of an ISP. In addition, content providers depend on ISPs’ services for the delivery of their content to end-users. In their role as providers of access to broadcasting, ISPs do not select or originate programming or package or aggregate programming services. While ISPs may perform these functions when they operate their own websites, this activity is separate from their role as ISPs, which is to provide for the transmission of content requested by their end-users.
[Emphasis added.]
[37] Relying on these findings, Shaw and the Coalition emphasize the fact that the role of ISPs is restricted to the provision of the mode of transmission and is content-neutral. They argue that only content providers, who place content on a server with the view that it be accessed by end-users, transmit the content and can be said to be “broadcasting”. The Cultural Group for its part contends that transmission cannot take place without ISPs and that by enabling the delivery of the content from content providers to end-users, ISPs partake in the transmission even if their role is content-neutral. According to the Cultural Group, both ISPs and content providers transmit the content.
[38] The referred question assumes that programs are transmitted on the Internet. The issue which must be elucidated is by whom? The answer turns on whether the definition of “broadcasting”, beyond being aimed at the person who transmits the program, extends to the person whose sole involvement is to provide the mode of transmission.
[39] I agree with the Cultural Group that the definition of “broadcasting” when read on its own can include a person whose sole involvement is to provide the mode of transmission since no distinction is made as to the active or passive nature of the involvement. However, this ceases to be the case when the definition is considered contextually having regard to the scheme and purpose of the Broadcasting Act.
[40] The distinction between the person providing the mode of transmission and the person making the transmission was examined by the Supreme Court in Electric Despatch in a context which, although involved with dated technology, remains relevant (Electric Despatch, page 91):
The wires constitute the mode of transmission by which the one lessee transmits the message along the wires to the other. It is the person who breathes into the instrument the message which is transmitted along the wires who alone can be said to be the person who "transmits" the message. The owner's of the telephone wires, who are utterly ignorant of the nature of the message intended to be sent, cannot be said within the meaning of the covenant to transmit a message of the purport of which they are ignorant.
[Emphasis added.]
[41] More than a century later, the Supreme Court relied on this interpretation in CAIP (paragraph 96). The issue in CAIP was whether ISPs – referred to in that case as “Internet intermediaries” – were shielded from copyright infringement liability by virtue of paragraph 2.4(1)(b) of the Copyright Act. This provision makes it clear that such liability cannot be visited upon persons whose only involvement is providing the means of telecommunication of an infringing work to the public:
2.4 (1) For the purposes of communication to the public by telecommunication,
…
(b) a person whose only act in respect of the communication of a work or other subject-matter to the public consists of providing the means of telecommunication necessary for another person to so communicate the work or other subject-matter does not communicate that work or other subject-matter to the public;
…
2.4 (1) Les règles qui suivent s’appliquent dans les cas de communication au public par télécommunication :
[…]
b) n’effectue pas une communication au public la personne qui ne fait que fournir à un tiers les moyens de télécommunication nécessaires pour que celui-ci l’effectue;
[…]
[Emphasis added.]
[42] After an extensive analysis, the Supreme Court held that Internet intermediaries came within this exception. In coming to this conclusion Binnie J., writing for a unanimous Court, relied on the Copyright Board’s assessment of the workings of the Internet which, in all essential aspects, is the same as that made by the CRTC in this case, and recognized the content-neutral role of Internet intermediaries. Although the Internet intermediaries were providing the means of communication, they were not “communicating” the infringing work as they had nothing to do with the content (CAIP, paragraphs. 92 and 95):
92. So long as an Internet intermediary does not itself engage in acts that relate to the content of the communication, i.e., whose participation is content neutral, but confines itself to providing “a conduit” for information communicated by others, then it will fall within [paragraph] 2.4(1)(b). The appellants support this result on a general theory of “Don’t shoot the messenger!”
….
95. Having properly instructed itself on the law, the Board found as a fact that the “conduit” begins with the host server. No reason has been shown in this application for judicial review to set aside that conclusion.
[43] The Cultural Group argues that the decision in CAIP has no bearing on the referred question because it was reached on the basis of paragraph 2.4(1)(b) of the Copyright Act and no such provision exists under the Broadcasting Act. According to the Cultural Group, if Parliament had wished to similarly exclude re-transmitters or other transmission intermediaries from the definition of “broadcasting”, it could have done so. The fact that Parliament did not do so is a clear sign that it intended such intermediaries to be included within the definition.
[44] However, the distinction between the means of communication and the communication itself is as fundamental to the Broadcasting Act as it is to the Copyright Act. In this respect, subsection 4(4) of the Broadcasting Act bears resemblance to subsection 2.4(1) of the Copyright Act in that it provides:
4. (4) For greater certainty, this Act does not apply to any telecommunications common carrier, as defined in the Telecommunications Act, when acting solely in that capacity.
4. (4) Il demeure entendu que la présente loi ne s’applique pas aux entreprises de télécommunication – au sens de la Loi sur les télécommunications – n’agissant qu’à ce titre.
[Emphasis added.]
[45] A “telecommunications common carrier” is in turn, defined in subsection 2(1) of the Telecommunications Act as:
2. (1) a person who owns or operates a transmission facility used by that person or another person to provide telecommunications services to the public for compensation.
2. (1) propriétaire ou exploitant d’une installation de transmission grâce à laquelle sont fournis par lui-même ou une autre personne des services de télécommunication au public moyennant contrepartie.
[Emphasis added.]
[46] It is apparent that subsection 4(4) of the Broadcasting Act also excludes from the operation of the Act transmission intermediaries when working solely in that capacity. Furthermore, while CAIP involved the Copyright Act, the reliance placed on Electric Despatch and in particular the finding that content-neutral transmission intermediaries cannot be said to “transmit” the content can have a wider applicability.
[47] Both the Copyright Act and the Broadcasting Act – like the covenant at issue in Electric Despatch – are concerned with the content being transmitted rather than the means of conveying this content. As the owners of the telephone wires in Electric Despatch, ISPs are “utterly ignorant” of the nature of the message intended to be sent, and therefore cannot be said to “transmit” a “program” the purport of which they have no knowledge (Electric Despatch, p. 91).
[48] Relying on the logic adopted by Binnie J. in CAIP in construing the word “communicate” under the Copyright Act, I am of the view that the definition of “broadcasting” is also directed at the person who transmits a program and that a person whose sole involvement is to provide the mode of transmission is not transmitting the program and hence, is not “broadcasting”.
[49] This interpretation is consistent with the policy objectives set out in subsection 3(1) of the Broadcasting Act. The primary focus is on the cultural enrichment of Canada through the broadcasting of programs which involve a significant amount of Canadian artistic creativity in their production, encourage Canadian expression and the use of Canadian talent, and which reflect Canada’s linguistic duality and multicultural society. The Broadcasting Act sets out specific provisions on programming content to achieve these objectives such as the allocation of broadcasting time, the character and volume of advertising, and the carriage of foreign programming (subsection 10(1) of the Broadcasting Act). Furthermore, in setting out the manner in which the Broadcasting Act is to be interpreted, subsection 2(3) refers to the “freedom of expression and journalistic, creative and programming independence enjoyed by broadcasting undertakings”.
[50] Because ISPs’ sole involvement is to provide the mode of transmission, they have no control or input over the content made available to Internet users by content producers and as a result, they are unable to take any steps to promote the policy described in the Broadcasting Act or its supporting provisions. Only those who “transmit” the “program” can contribute to the policy objectives.
[51] Nevertheless, the Cultural Group argues that the ISPs’ inability to contribute to the achievement of the policy objectives is no basis for excluding them from the definition of “broadcasting”. In support of this contention, the Cultural Group points to the power given to the CRTC pursuant to subsection 9(4) of the Broadcasting Act to exempt by order those who carry on broadcasting undertakings from compliance with the Act or a regulation made thereunder, where such compliance would not contribute to the implementation of the broadcasting policy. Subsection 9(4) provides:
9. (4) The Commission shall, by order, on such terms and conditions as it deems appropriate, exempt persons who carry on broadcasting undertakings of any class specified in the order from any or all of the requirements of this Part or of a regulation made under this Part where the Commission is satisfied that compliance with those requirements will not contribute in a material manner to the implementation of the broadcasting policy set out in subsection 3(1).
9. (4) Le Conseil soustrait, par ordonnance et aux conditions qu’il juge indiquées, les exploitants d’entreprise de radiodiffusion de la catégorie qu’il précise à toute obligation découlant soit de la présente partie, soit de ses règlements d’application, dont il estime l’exécution sans conséquence majeure sur la mise en oeuvre de la politique canadienne de radiodiffusion.
[52] According to the Cultural Group, this shows that the definition of “broadcasting” was intended to be broad, reaching all those who partake in the transmission including entities whose sole function is to provide the mode of transmission. To the extent that in performing this function ISPs cannot contribute to the policy objectives, Parliament has given the CRTC the power to issue the appropriate exemptions.
[53] This argument might have some weight were it not for the fact that, as we have seen, the Broadcasting Act specifically provides that it does not apply to a telecommunications common carrier when acting solely in that capacity. Furthermore, it would be highly unusual for a statute to be construed in a manner that overshoots its objects