Confidential by Casey Marshall (CC BY 2.0) https://flic.kr/p/5MYYdr

Confidential by Casey Marshall (CC BY 2.0) https://flic.kr/p/5MYYdr

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The Broadcasting Act Blunder, Day 15: Mandated Confidential Data Disclosures May Keep Companies Out of Canada

The Broadcasting Act blunder series has highlighted Bill C-10’s many regulatory requirements for Internet services including registration, regulations, CRTC-imposed conditions, discoverability requirements, and (in an upcoming post) mandated payments. There is another requirement that may raise the ire of some foreign services and force them to consider blocking the Canadian market. The bill establishes significant confidential data disclosure requirements as a condition that may be imposed on Internet services both big and small around the world.

Section 9.1(1)(j) gives the CRTC the power to set the following requirement on all broadcast undertakings, including online undertakings:

the provision to the Commission, by persons carrying on broadcasting undertakings, of any other information that the Commission considers necessary for the administration of this Act, including

(i) financial or commercial information,
(ii) information related to programming,
(iii) information related to expenditures made under section 11.1,
(iv) information related to audience measurement, other than information that could identify any individual audience member, and
(v) other information related to the provision of broadcasting services

In other words, the CRTC can demand everything: financial data, programming data, expenditure information, audience measurement data, and anything else it deems relevant. In many cases, this information is commercially sensitive, not publicly available, and not required by other regulators.

In fact, the bill goes further than just disclosures to the Commission. Section 25.1 of the bill allows the CRTC to provide that same confidential information to the Minister of Canadian Heritage, Chief Statistician of Canada, and (at Section 25.3) the Commissioner of Competition. The wide distribution increases the risk of a leak and makes tracing access to it more difficult. Companies can designate the information as confidential, but the CRTC can still publicly disclose the information if it is disclosed in the course of a proceeding (for example, a proceeding to determine what conditions Internet companies will face) if believes it is in the public interest to do so.

While the CRTC needs good data to make effective decisions (particularly given the remarkably expansive powers it is granted in the bill), the broad approach to mandated confidential information disclosure carries some significant risks. As noted in an earlier post regarding targeting individual services, the condition on information disclosure can be limited to specific companies. For example, the CRTC could require companies such as Netflix or YouTube to disclose detailed audience and algorithmic data, which is data that those companies have been reluctant to make available anywhere in the world.

Moreover, the disclosure requirements are likely to extend to a very broad range of services, many of which may have limited or little connection to Canada. While the bill does not contain economic thresholds (contrary to the claims of Minister Guilbeault), the CRTC could establish such thresholds after extensive hearings. If it does so, companies may be required to provide the Commission with confidential subscribers and financial data as evidence that they qualify for an exemption. In other words, services of all sizes and from all over the world will find themselves caught by CRTC regulation and requirements to disclose their confidential data. Their response may well be to give Canada a pass by actively blocking Canadian users to reduce the risk of regulation, thereby leaving consumers with less choice and competition.

(prior posts in the Broadcasting Act Blunder series include Day 1: Why there is no Canadian Content Crisis, Day 2: What the Government Doesn’t Say About Creating a “Level Playing Field”, Day 3: Minister Guilbeault Says Bill C-10 Contains Economic Thresholds That Limit Internet Regulation. It Doesn’t, Day 4: Why Many News Sites are Captured by Bill C-10), Day 5: Narrow Exclusion of User Generated Content Services, Day 6: The Beginning of the End of Canadian Broadcast Ownership and Control Requirements, Day 7: Beware Bill C-10’s Unintended Consequences, Day 8: The Unnecessary Discoverability Requirements, Day 9: Why Use Cross-Subsidies When the Government is Rolling out Tech Tax Policies?, Day 10: Downgrading the Role of Canadians in their Own Programming, Day 11: The “Regulate Everything” Approach – Licence or Registration Required, Broadcast Reform Bill Could Spell the End of Canadian Ownership Requirements, Day 12: The “Regulate Everything” Approach – The CRTC Conditions, Day 13: The “Regulate Everything” Approach – Targeting Individual Services, Day 14: The Risk to Canadian Ownership of Intellectual Property)

3 Comments

  1. The cost of providing the information and complying with the regulations will also be a factor in the response from streaming companies. Canadian lawyers who specialize in these regulations, like Fortinbras, will be hired to help minimize the regulatory costs and disclosures. The large streaming companies will hire the best lawyers and lobbyists to get the most favourable outcomes. The smaller streaming companies will wait until the rules are sorted out before deciding to enter the Canadian market.

    The large streaming companies could also band together: to lobby US and Canadian politicians, to put pressure on Bell, Rogers and Corus to oppose the regulations, and overwhelm the CTRC with recommendations.

  2. Pingback: ● NEWS ● #MichaelGeist #canada ☞ The #BroadcastingAct Blunder, Day … | Dr. Roy Schestowitz (罗伊)

  3. Pingback: News of the Week; December 16, 2020 – Communications Law at Allard Hall

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