Canada's Retransmission Fee Battle to Supreme Court

Highest court to hear cable industry opposition to paying for local TV signals.

TORONTO – Canada’s retransmission fee debate is headed to the Supreme Court. 

Cable giant Rogers Communications and phone giant Telus Corp. will take their fight against so-called fees-for-carriage to the highest court after a narrow loss Monday in the Federal Court of Appeal.

The lower court, by a two-to-one margin, said domestic broadcasters can negotiate first-time compensation from cable and satellite TV operators for their local TV signals.

Rogers will be seeking leave to appeal the decision,” Rogers spokeswoman Jan Innes said.

“It would make no sense for consumers to underwrite the current takeovers in the industry,” Telus senior vice-president of regulatory affairs Michael Hennessy added in a statement.

The CRTC, Canada’s TV regulator, last year referred the retransmission fee issue to the Federal Court of Appeals to see whether it had jurisdiction to impose carriage fees local TV signals.

Justice Sharlow of the lower court, in a majority decision, agreed that the CRTC has the “statutory authority” under the federal Broadcasting Act to introduce a fee for carriage regime.

But domestic cable and satellite TV operators, who have long argued retransmission fees amount to a new tax on Canadian TV viewers, took heart from Justice Nadon in a dissenting opinion arguing that the federal Copyright Act establishes “a clear limit” on the CRTC’s powers to allow carriage compensation.

The latest stage in Canada’s retransmission debate also follows industry consolidation, which would see major carriers like BCE Inc. and Shaw Communications potentially pay for local TV signals that they own via newly acquired conventional TV networks.