Federal Court of Appeal thwarts any prospect of an "ISP Levy" to support new media content
In a Decision released on July 7th (see CBC News story (ISPs not broadcasters, court finds), on-line version of decision not yet available), the Federal Court of Appeal has ruled that ISPs that merely provide access to broadcasting are not "broadcasting" under the Broadcasting Act. Therefore, the CRTC cannot justify imposing contribution levies on ISPs as it currently does for cable and satellite broadcast distributors (BDUs) under broadcasting legislation.
The Court's ruling effectively thwarts (subject to any appeals) the proposals by Canadian creator groups to require ISPs to contribute toward the funding of Canadian new media content. The Court's ruling is based on the ISPs' "content-neutral" approach in providing access to users. In an analysis similar to that of the Supreme Court of Canada in a leading copyright case (the Tariff 22 decision between SOCAN and the Canadian Association of Internet Providers), the Federal Court of Appeal determined that the definition of “broadcasting” under the Broadcasting Act is also directed at the person who "transmits" a program. A person whose sole involvement is to provide the mode of transmission is not transmitting the program and hence, is not “broadcasting”.
An ISP whose sole involvement is to provide the mode of transmission would have no control or input over the content made available to Internet users by content providers. The ISP acting in this way does not "select, originate or package programming", which is precisely what a BDU does. ISPs are therefore not an element of the broadcasting system (although their activities would continue to be governed by the Telecommunications Act). This in turn means that ISPs cannot be required to achieve broadcasting policy objectives through measures such as financial levies. Only those who “transmit” the “program” can contribute to these objectives.
