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COVID-19-related resources brought to you by Dentons

As the entertainment industry in Canada and internationally struggles with the implications of dealing with COVID-19, we are entering uncharted territory. Beginning last week, major studios, streamers and broadcasters from around the world announced that they would be shutting down or suspending their productions in an effort to deal with the widening pandemic and slow its progress. Indie Wire online has provided a sobering summary of all of the productions impacted by COVID-19.

The situation is rapidly evolving and Dentons has established some resources for clients to provide helpful insights on COVID-19-related issues in a number of countries around the world. 

The Dentons Global COVID-19 hub can be found here – https://www.dentons.com/en/issues-and-opportunities/covid-19-coronavirus-hub

The Dentons Canada COVID-19 hub can be found here – https://www.dentons.com/en/issues-and-opportunities/covid-19-coronavirus-hub/canada-covid-19-coronavirus-hub

A recent article on the Dentons Canada COVID-19 hub may be useful to clients grappling with the issue of force majeure and whether COVID-19 qualifies as such an event. The article can be found here.

Another article on the Dentons Canada COVID-19 hub outlines the US travel restrictions for those clients with international ties. The article can be found here.

COVID-19-related resources brought to you by Dentons

E-1 Visas for Canadian production companies

Canadian production companies that sell films and/or television productions to US-based companies can face challenges when sending key personnel to the United States. The issue frequently arises when some or all of the Canadian production is scheduled to take place on location in the US.

Many Canadian production companies focus on more traditional US work permit categories, which were created with the film and television industry in mind (for example, the O-1B for aliens of extraordinary achievement in the motion picture or television industry, and the O-2 for related essential support personnel).  However, these categories carry onerous eligibility requirements and can be difficult to navigate.

The E-1 (treaty trader) category can be a viable alternative to the O-1B and O-2 categories. Unfortunately, Canadian production companies tend to overlook the E-1 category, because it was initially intended for entrepreneurs rather than the film and television industry. 

To learn more about the E-1 qualifications and eligibility requirements, please read the full insight on dentons.com. For more information about this or other immigration-related topics, please contact Henry J. Chang.

E-1 Visas for Canadian production companies

Ottawa Launches Overhaul of Cultural Policy

The Department of Canadian Heritage has launched a review of the federal government’s cultural policy toolkit that could bring significant changes to the governance framework that underpins the broadcasting, media and cultural industries.

Announced this past weekend by Heritage Minister Mélanie Joly, the review is a response to the digital shift that is transforming the creative sector. The stated goal of the review is to ensure that Canadian content is positioned to succeed in an increasingly global marketplace which, as stakeholders well know, has been buffeted by the rapid evolution of new technologies that have changed the ways content is created and consumed.

Minister Joly made it clear in an interview with the Globe and Mail that each of the main governance levers – laws, policies, institutions and programs – will be evaluated. She told the Globe that she believes “the current model is broken, and we need to have a conversation to bring it up to date” and that “everything is on the table”.

Beyond a generally “digital approach”, it’s anyone’s guess as to what the policy outcomes of the review will be. The minister has indicated that she doesn’t want to go into consultations with preconceived notions of what they might yield, and has refused to speculate about eventual changes. However, the “drivers of change” articulated in the announcement of the review provide some sense of the likely focus:

  1. A fluid environment that blurs traditional categories like “creator” and “user”, “artists” and “audience”, and “professional” and “amateur”;
  2. The emergence of new players and intermediaries that have disrupted traditional business models;
  3. An increasingly open and interconnected world in which access to a global marketplace comes at the price of stiff competition in formerly local cultural markets; and
  4. Changes in consumer expectations driven by increased digital connectivity and mobility.

The consensus from the commentariat is that the review will be the most comprehensive re-evaluation of the industry since the Mulroney government revised the Broadcasting Act in 1991.

Content producers and other stakeholders should note that an online “pre-consultation questionnaire” can be accessed on the ministry’s website until May 20, 2016. The pre-consultation will help define the scope of the public consultation which will begin this summer and wrap up by the end of the year. An expert advisory group will be struck to shepherd the review, which is officially called Strengthening Canadian Content Creation, Discovery and Export in a Digital World.

Ottawa Launches Overhaul of Cultural Policy

Online Endorsements and “Astroturfing”

Having warned consumers: “Don’t buy into fake online endorsements” last year, the Competition Bureau sent a strong message to the media and marketing industry against astroturfing yesterday.  The Bureau announced that it has entered into a consent agreement with Bell Canada addressing employee-generated reviews and ratings of Bell apps on the iTunes App Store and the Google Play Store.  While Bell reportedly moved quickly to have the reviews and ratings taken down, the Competition Bureau evidently considered that the damage was already done:

“these reviews and ratings created the general impression that they were made by independent and impartial consumers and temporarily affected the overall star rating for the apps.”

Bell has agreed to pay an administrative monetary penalty of $1.25 million and has committed to enhance its corporate compliance program.  The company also proposes to host a workshop to promote “Canadians’ trust in the digital economy”, including online review integrity.

The Canadian Competition Act contains criminal and civil prohibitions against materially false or misleading representations.  The general impression conveyed by the review, rating, tweet, post or other representation is a key element of determining whether it is misleading.

As part of its education, outreach and enforcement programs, the Bureau recently devoted its first edition of The Deceptive Marketing Practices Digest to online advertising, with a focus on online reviews.  The Bureau made a point of noting that “astroturfing is a problem that crosses borders” and highlighting its “excellent working relationship” with its international partners, including the US Federal Trade Commission.   In yesterday’s announcement, the Bureau invited consumers who believe that they have been misled by fake online reviews to call the Bureau’s Information Centre or to file a complaint on its website.

The recent activity and statements around online reviews make it very timely to revisit (or develop) internal compliance policies.  These can include examples of acceptable and unacceptable practices for reviews and ratings, endorsements, disclaimers, and special promotions such as sponsorships and contests.

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Online Endorsements and “Astroturfing”

Let’s Talk TV – CRTC Roadmap to “Maximize Viewer Choice”

The Canadian Radio-television and Telecommunications Commission (CRTC) has issued its fourth “Let’s Talk TV” policy decision on the regulation of the Canadian television system.  Today’s decision is  A World of Choice – A roadmap to maximize choice for TV viewers and to foster a healthy, dynamic TV market.

The new roadmap affects the “basic” TV service Canadian subscribers receive, and adds new options for subscribers to choose additional services on a pick-and-pay or a la carte basis.

We wrote last week about the CRTC’s new regulatory measures geared to creating and showcasing Canadian content, set out in its policy decision The Way Forward – Creating Compelling and Diverse Canadian Programming.  Many of those decisions are geared to industry-based expenditure and exhibition requirements, and will have an indirect or gradual impact on viewers’ TV experience.  By comparison, today’s decisions take direct aim at viewer choice.

Skinny Basic

By March 2016, licensed broadcasting distribution undertakings (BDUs) must offer a small basic, entry-level service that includes:

  • local and regional Canadian over-the-air (OTA) stations;
  • the applicable provincial / territorial educational service;
  • all  mandatory distribution “9(1)(h)” television services – about 15 channels, depending on the market; and
  • the community channel and the proceedings of the provincial legislature (if offered).

The basic package may also include other Canadian OTA stations in markets where fewer than 10 local or regional stations are available; local radio stations; an out-of-province designated educational service, and a set of “US 4+1 signals” (NBC, CBS, ABC, Fox and PBS).  BDUs may not offer any other services in the basic package.

Moreover, the basic package must now be priced at or below $25.   The CRTC had de-regulated the basic package in 1997, stating at that time that deregulation represented “a fundamental change” for subscribers from a “20-year regulatory regime with Commission scrutiny” of basic service rates to a regime driven by market forces only.  With today’s decision, the Canadian regime is back  under Commission control, to further its policy of consumer control.

 Pick and Pay / A la carte 

In 2013, the Governor in Council (Cabinet) issued an Order in Council to the CRTC to report on how to maximize pick-and-pay in Canada.  In response, the CRTC observed that Canadians were getting “a more customized viewing experience” from online platforms, and considered how mandating increased choice and flexibility for television would potentially impact cable and satellite operators, broadcasters, and the production industry.

In today’s decision, the CRTC has taken the position that “it must take positive steps to bring about greater choice and flexibility in the Canadian television system”.

  • By March 2016, all licensed broadcast distributors (BDUs) must offer all discretionary services – meaning those not in the basic service – either on a pick-and-pay basis or in small, “reasonably priced” packages.  These packages may be set by the BDU or by the subscriber.
  • By December 2016, all licensed BDUs must offer all discretionary services on both a pick-and-pay basis and in small packages.

The CRTC noted the risk this “unbundling” poses to the Canadian system and the survival of some Canadian services; its greater concern was the risk it saw in “maintaining the status quo in a context of increased demand for more choice”.

Distribution of non-Canadian TV services

While the Commission entitled its decision “A World of Choice”, the Commission has not changed the process for authorizing the entry of non-Canadian services.  The current List of non-programming services authorized for distribution (the List) includes a range of U.S. and other foreign services, including channels such as A&E, AMC, and MSNBC.   The Commission has authorized services on a case-by-case basis, permitting Canadian services to object to the addition of a new non-Canadian channel on the basis that it will unfairly overlap and compete with its own genre and nature of service.  The Commission will continue to authorize only those non-Canadian services that do not compete with Canadian specialty or pay services.

However, the CRTC is bringing the distribution of non-Canadian services in line with the rules set out in today’s policy regarding consumer choice.  As a condition of authorization – for existing services to remain on the List, and for new services applying to be added – the service must be offered on the basis of pick-and-pay and small packages.  The CRTC has said that “it expects non-Canadian services, as good corporate citizens, to continue to abide by the applicable rules …if they wish to continue to have their programming services available in Canada”.

An Expanded and Stricter Wholesale Code

In 2011, largely in response to what it considered to be imbalances in the wholesale marketplace brought about by “vertical integration” in the industry, the CRTC put in place a new regulatory framework for the commercial arrangements between BDUs, broadcasters, and digital media undertakings.  While the 2011 Code was originally drafted with certain mandatory requirements, the CRTC issued a correction to change various instances of “shall” to “should”.  Subsequently the CRTC applied elements of the Code to some licensees as a condition of licence.

Today, the CRTC not only effectively put the “shall” back into the Code for the industry as a whole, stating that it will be a regulatory requirement, not a guideline, for all licensed undertakings.  The CRTC also indicated that the Code will be expanded to include a number of additional prohibitions and mandatory requirements.  These are intended to ensure that the terms of wholesale agreements do not undermine or hinder choice and flexibility in the retail market.  New provisions, to enter into effect by September 2015, will target agreement terms that address packaging, service penetration and revenue guarantees, rate cards, and marketing.

Today’s decision was the 4th of 5 arising from the CRTC’s Let’s Talk TV Proceeding.  The final decision is expected next week, under the CRTC’s “Protect” banner:  consumer protections, BDU Code of Conduct, industry ombudsman, and accessibility issues.

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Let’s Talk TV – CRTC Roadmap to “Maximize Viewer Choice”