Canada: Communications Regulatory

INFORMATION AND COMMUNICATION LAW

A central policy platform of the federal government has been ensuring the prosperity and growth of the middle class. As the world shifts to a knowledge-based global economy driven by the creation of ideas and their translation into commercial value, the federal government has committed to readying the Canadian economy for the transformative changes that are underway.

This commitment entails, among other things, the review and reform of the legislation and regulatory frameworks that underpin the generation of value from the electronic communication of unprecedented quantities of rich data sets.

In 2017, the Government of Canada launched the National Innovation Agenda. Included in this Agenda were several forward-looking initiatives, including an investment of CA$950 million over five years towards innovation "superclusters", referring to areas within cities or communities that display both a high concentration of academic strength and business growth. To much less fanfare, but in line with similar initiatives across other high-income countries around the world, the government also launched a number of interrelated public consultations and legislative reform initiatives in the following areas:

• Copyright
• Communications
• Digital and data transformation

The output of many of the public consultation and legislative reform initiatives launched in previous years will become available in 2019. Whether the government will have the opportunity to implement the recommendations flowing out of these consultative processes may also depend on the outcome of the upcoming federal election on October 21, 2019.

COPYRIGHT

There are a number of intersecting initiatives in Canada examining copyright reform as an element of preparing Canada for its participation in the global digital economy.

Review of Canadian copyright

On December 13, 2018, Bill C-86¸ A second Act to implement certain provisions of the budget tabled in Parliament on February 27, 2018 and other measures, was made law in Canada.

Bill C-86 amended the Copyright Act in order to specify that settlement offers and demands for personal information are not permitted to be included within a notice given by a copyright owner under the Canadian notice-and-notice regime¹ and to provide for a regulation-making power to prohibit further types of information from being included within these notices. This is intended to rein in the perceived aggressive demands that have been made over the past several years.

One issue that has not been addressed in Bill C-86 involves pirated audio-visual content accessed by Canadians on the Internet, and calls from creators and licensed audio-visual content programming and distribution undertakings for measures to empower or facilitate blocking websites that allegedly provide such access. An industry-led coalition, called the "Fair Play Coalition", sought an order from the Canadian Radio-television and Telecommunications Commission (CRTC), but the request was turned down by the CRTC on grounds that it had no jurisdiction over copyright under either the Telecommunications Act or the Broadcasting Act. Both the audio-visual content production and licensed broadcasting industry in Canada continue to stress the urgency and necessity of measures other than court orders in their fight against pirated online content.

A broader debate has also been opened up in Canada around the copyright policy framework that is required to promote innovation in the digital economy, a large part of which is dependent on ownership, control and/or access to valuable information (data sets). The Parliamentary House of Commons Standing Committee on Industry, Science and Technology is in the midst of undertaking a review of Canadian copyright, and has heard from a wide range of stakeholders on issues such as fair dealing, which is the Canadian equivalent of fair use. 

While the question of striking the appropriate balance between publishers, authors and users is not new, there is added complexity arising from the globalization of data flows, and the increasing concentration of large amounts of data in the hands of relatively fewer players. It is worth noting that the terms of the Canada-US-Mexico Agreement (CUSMA) arguably add to this complexity. The CUSMA requires Canada to extend the term of copyright protection from the current term of the life of the creator plus 50 years, to the life of the creator plus 70 years. It also confines limitations on or exceptions to exclusive rights "to certain special cases that do not conflict with a normal exploitation of the work, performance, or phonogram, and do not unreasonably prejudice the legitimate interests of the right holder." Notwithstanding the preservation of Canada's notice-and-notice regime, the Intellectual Property chapter of the CUSMA requires that signatories legislate incentives for ISPs to cooperate with copyright owners in specified ways. Furthermore, signatories are obliged to impose civil and criminal remedies on any person who circumvents digital locks on copyrighted content, subject to certain specified and limited exceptions for "good faith" copying.

Bill C-86 reforming the Copyright Board

In 2018, the federal government implemented changes to the decision-making processes of the Copyright Board with the objective of making them more efficient. Between August 9, 2017, and September 29, 2017, the government held a Consultation on Options for Reform to the Copyright Board of Canada. Among the measures subsequently implemented in Bill C-86 were:

• A 30 percent increase in the Copyright Board's annual administrative budget, recognizing the importance of its decision-making processes for copyright owners and copyright users, alike; and
• Amendments to the Copyright Act to modernize the legislative framework relating to the Copyright Board, so as to improve the timeliness and clarity of its proceedings and decision-making processes. This includes:
  
  
  • Codifying the Board's mandate;
  • Establishing new decision-making criteria;
  • Establishing new timelines in respect of Board matters to streamline proceedings; and
  • Increasing the ability to enforce certain Board-set terms and conditions, including making statutory damages available for certain Board-set royalty rates.

COMMUNICATIONS

Prime Minister Trudeau's mandate letter to Innovation, Science and Economic Development Minister Navdeep Bains, dated November 12, 2015, provided that among his top priorities was to "increase high-speed broadband coverage, and work to support competition, choice and availability of services, and foster a strong investment environment for telecommunications services to keep Canada at the leading edge of the digital economy."

On June 5, 2018, the Government of Canada appointed a panel of seven experts (BTLR Panel)² to study and report on 31 questions set out in the panel's Terms of Reference, related to ways in which the telecommunications, broadcasting and radiocommunication (wireless spectrum) statutes of Canada could be modernized.

All three Acts date back to at least the mid-1990s. They predate, and largely do not reflect, the shifts brought about by the Internet or the coming age of connected machine-to-machine wireless communications systems. The BTLR Panel report is not due until January 31, 2020.

In the meantime, the Senate of Canada is scheduled to issue a report on its own study of how the three Acts governing the communications sector "can be modernized to account for the evolution of the broadcasting and telecommunications sectors in the last decades."

Digital and data transformation

As reported in the 2018 edition of Dentons' Pick of Global Regulatory Trends to Watch, Canada's antitrust regulator, the Competition Bureau, stated in a paper on "big data" that its established analytical framework can be applied usefully to cases involving big data, and the application of the Competition Act must remain case-specific to minimize the risk of stifling the innovation that may arise from the operation of competitive market forces.

However, other observers do not appear as sanguine. In the intervening 18 months or so since the Competition Bureau issued its study of big data, there have been increasing calls from various quarters to effect a fundamental rethinking of the regulatory approach to firms whose competitive performance is driven by their ability to collect, analyze and use data.
TheParliamentary House of Commons Standing Committee on Access to Information, Privacy and Ethics (ETHI Committee) released a number of reports in 2018 pertaining to potential reforms to Canada's privacy legislation, as well as potential new legislation to govern social media platforms:

• 12th Report, dated February 28, 2018: Towards Privacy by design: Review of the Personal Information Protection and Electronic Documents Act;
• 14th Report, dated May 9, 2018: Protection of Net Neutrality in Canada; and
• 17th Report, dated December 11, 2018: Democracy under Threat: Risks and Solutions in the Era of Disinformation and Data Monopoly.

In parallel to the other consultation and legislative reform processes launched in 2018, the Minister of ISED has launched a national public consultation on Digital and Data Transformation that seeks to better understand the drivers of innovation and the future of work, while at the same time, ensuring that Canadians have trust and confidence in how their data is used. In the discussion paper accompanying the launch of the Digital and Data Transformation consultation, the Minister of ISED has recognized that framework laws related to consumer protection and safeguarding of competition must be revisited to ensure Canada's readiness for the digital transformation. It is noteworthy that in the context of both the Digital and Data Transformation consultation and the BTLR Panel's consultation process, Canada's Privacy Commissioner has expressly criticized the Personal Information Protection and Electronic Documents Act (PIPEDA) as being essentially an "industry code of practice-inspired" statute that is based on the principles of consent, transparency and accountability. In submissions dated November 29, 2018, and January 11, 2019, the Privacy Commissioner stated that while PIPEDAshould continue to be principles-based and allow for responsible innovation, it should be re-drafted to confer enforceable rights on individuals, and strong direction-making and investigatory powers on the Office of the Privacy Commissioner.

Whatever the outcome of the fundamental public policy debate on the appropriate balance to be struck between an innovation-based economic growth strategy, and the preservation of trust and confidence in the levers of the new economy, one thing is certain: legislative and regulatory changes across a broad swath of information and communication statutes are a key regulatory trend to watch in 2019 and beyond.

Footnotes

1. The notice-and-notice regime is the regime set out in the Copyright Act that requires Internet intermediaries, including Internet service providers (ISP), to forward to their subscribers any notices that the ISP receives from copyright owners alerting the ISP that the subscriber's accounts have been linked to allegedly infringing activities, such as the downloading of allegedly copyright-infringing audiovisual, audio or other content.="Back to content">↩

2. Dentons Canada partner Monica Song is one of the seven individual experts appointed by the Minister of ISED and the Minister of Canadian Heritage to serve on the BTLR Panel. See online https://www.ic.gc.ca/eic/site/110.nsf/eng/home="Back to content">↩

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