Proceedings of the Standing Senate Committee on
Legal and Constitutional Affairs

Issue 53 - Evidence - Morning Sitting


OTTAWA, Wednesday, April 2, 1997

The Standing Senate Committee on Legal and Constitutional Affairs, to which was referred Bill C-71, to regulate the manufacture, sale, labelling and promotion of tobacco products, to make consequential amendments to another Act and to repeal certain Acts, met this day at 8:37 a.m. to give consideration to the bill.

Senator Sharon Carstairs (Chair) in the Chair.

[English]

The Chair: Good morning, senators. We are continuing our study of Bill C-71. We have a number of witnesses this morning. I understand we are to begin with Mr. Ducharme.

[Translation]

Mr. Germain Ducharme, President, Office des producteurs de tabac jaune du Québec: The Office des producteurs de tabac jaune du Québec is pleased to appear before the Senate committee examining Bill C-71.

We wish to share with you our concerns about three aspects of this bill which affect Quebec's flue-cured tobacco growers in particular.

The first point in need of clarification is the hiring of young persons under the age of 18 to work on tobacco farms during the summer. The bill is quite vague on this subject. We want to know if it will be legal for minors to work on a tobacco farm?

For Quebec's tobacco farmers, young persons under the age of 18 represent a sizeable pool of workers. No fewer than 500 young people from our region go to work every year in the tobacco fields. The wages they earn are among the highest in the agricultural industry, quite a bit higher as a rule than the minimum wage. Most young workers earn enough money to cover their school-related expenses. Through their work, they make a significant economic contribution to their families and to society. Furthermore, it would be completely ridiculous if the sons and daughters of tobacco farmers were unable to work on the family farm because of this bill. It is at this point in their lives that young persons learn to work as a team, to assume some responsibility and to adjust to a work schedule. The experience they gain will prepare them to meet the obstacles that lie ahead for them as adults. If we can no longer rely on this affordable pool of labour, we will have no other alternative but to use foreign workers.

For all of these reasons, we would like to see the bill amended so that it is clear on whether or not tobacco farmers can hire persons under the age of 18 to work in this industry.

The second point which concerns us is the role of the inspector as spelled out in Part V of the bill. For the purposes of this act, the minister may designate any person or class of persons as an inspector or analyst.

Who are these persons who may arrive without warning to search our farm storage facilities, believing they have so-called reasonable grounds to do so?

Do you not find their mandate somewhat broad? What is the meaning of the word "reasonable"? This appears to be an abuse of power. We truly do not see the need for this because all of the products that we use are already closely regulated by Agriculture Canada. We are not tobacco manufacturers, but rather tobacco growers. We would like the tobacco bales stored on the farm to be exempted from the inspection provisions set out in the Act.

The third point which concerns us is the tobacco advertising found in magazines imported into Canada. It is alarming for Canadian farmers to realize that Canadian smokers will not be exposed to Canadian tobacco products. Eventually, consumers may be influenced by what they see advertised in the imported magazines and chose foreign products at the expense of Canadian ones. This phenomenon poses a major threat to Canadian tobacco growers and will result in substantial losses for governments and growers alike.

As far as Bill C-71 is concerned, the Office endorses the objective of this bill, which is to restrict tobacco consumption by persons under the age of 18. This is a laudable objective. However, we seriously doubt the effectiveness of this bill as a means for the government to achieve its objectives. There is nothing in this legislation that will prevent more young people from taking up smoking in the first place. The new restrictions introduced on such things as the sponsorship of sporting and other events, advertising, product display, the number of cigarettes per package, the regulatory process, labelling and packaging will not have any positive effect whatsoever on the smoking habits of young people.

Any new prohibitions on smoking will have just the opposite effect. You were young yourselves once and you know how attractive forbidden fruit can be to young people.

For years now, people have been receiving enough information about the dangers of smoking to decide for themselves whether or not to smoke. Legislation is increasingly regulating our lives and telling us what we can and cannot do. Is this what democracy is all about?

Tobacco is a legal product and should be treated as such. The proposed legislation is a shot in the dark and will not achieve its objective. All it will do is create economic problems.

Mr. Michel Gadbois, Chief Executive Officer, Association des détaillants en alimentation du Québec: Madam Chair, I will be happy to answer your questions in English, but I will be delivering my presentation in French.

I represent the Association des détaillants en alimentation du Québec and I am here today on behalf of Alimentation Couche-tard, a chain of outlets that are members of the ADA. Alimentation Couche-tard operates 310 retail outlets in Quebec, employs approximately 2,000 people and records sales of about $400 million. The company has been in business for 17 years. Tobacco sales account on average for 27 per cent of all corner store sales.

Why are we here representing Alimentation Couche-tard? As you know, this company was actively involved in the fight to end tobacco smuggling in 1991. You may recall the efforts made by the association and by Alimentation Couche-tard in Quebec. On issues involving the government, the ADA makes representations and states its position. We have tabled a brief and our position is backed by 10,000 food retailers in Quebec. In fact, if we include retailers and their families, a total of 500,000 people and businesses in Quebec are affected. We are talking about 85,000 direct jobs. The retail sector generates approximately $2 billion for the Quebec economy and $1.2 billion in revenues for the various levels of government, including revenues from tobacco taxes.

We wish to focus today on the specific elements of the current regulations which affect our commercial operations. We do not wish to pass judgment on smoking or on the effectiveness or ineffectiveness of the proposed measures. We want to stress the commercial and practical implications of the legislation and the economic impact it will have on our businesses.

In our submission, we identified a number of provisions which we would like to see either amended or repealed. We would also like to zero in on the fact that the various provisions in the bill assign considerable responsibility to retailers.

In my opinion, from a constitutional stand point, it is the secondary activity rather than the product itself that is being targeted here. Later on, I will refer to a decision which states that considerable attention is being paid to the promotion or to the promotional aspect of a product which technically is legal. The objective appears to be to make secondary activities, that is those associated with the marketing of this product, illegal.

We have two main concerns. First, there is the fact that responsibility for monitoring the age of minors is not shared by anyone else in Quebec and in Canada. I will refer to certain clauses in a few moments, but only the retailer is subject to a fine and held responsible for the sale of tobacco products to minors. That is the first thing I wanted to bring to your attention, specifically clause 8 of the bill.

Our second concern is the extent of the responsibility borne by retailers in terms of promoting tobacco products in their store. From our interpretation of these provisions, we note that retailers are directly responsible for any advertising on their premises as well as for the packaging of the product in their stores. You can understand why we are concerned about the level of responsibility that retailers are being asked to shoulder.

Senator Nolin: Exactly which regulations are you referring to?

Mr. Gadbois: Those in the bill.

Senator Nolin: Are you talking about the text of the bill?

Mr. Gadbois: I am simply referring to the clauses.

Senator Nolin: This bill will give rise to a number of regulations, but since it has yet to be passed, there are no regulations currently in force.

Mr. Gadbois: I understand. I have to say that these clauses as they are now written are already quite clear insofar as the responsibility of retailers is concerned, even without any future regulations.

Senator Nolin: We understand one another. I simply wanted to clarify that point.

Mr. Gadbois: We raise a number of issues in our brief. The first is the problem of the sole responsibility placed upon the retailer in clause 8. The retailer alone is responsible for assessing the age of the person purchasing the cigarettes, not the parents or the police. It is still quite legal to purchase cigarettes for minors. There is nothing that prohibits this.

We are faced with a rather odd situation because even the youth protection service which works with young persons supplies a daily quota of cigarettes to Quebec minors. This is an indication of just how ridiculous the situation has become across the country.

Quebec has clear legislation on the books regarding alcohol. We are prohibited from selling alcohol to minors, as you well know, but it is also against the law for minors to purchase, possess or consume alcohol. That is not the case with cigarettes. It is much easier for us to monitor the age of people buying alcohol. The buyer himself knows that he can be charged and fined. That is not the case with cigarettes.

We the retailers are being made to shoulder all of the responsibility. The penalties can be substantial, ranging from fines of up to $25,000 to the suspension of our retail licence. That could put us out of business.

Another concern that we have about clause 8 of the bill is the documentation or identity required. In most cases, people produce their health insurance card or their driver's licence as proof of their identity and in the case of minors, this may be difficult because they do not always have a driver's licence. It is illegal for us to demand one of these cards as proof of a person's identity. We could be fined for doing so because driver's licences can only be used for identification purposes in the case of roadside checks or when requested by highway safety officials. This is quite clear in the Quebec legislation governing drivers licences. The same is true of health insurance cards. No one can ask to see a health insurance card for identification purposes, unless that person is in the business of providing health benefits. We are penalized if we do not request identification, but at the same time, we can be fined for requesting it.

A parliamentary committee in Quebec is currently examining the issue of I.D. cards. You have received a copy of the brief that we presented to this particular parliamentary committee expressing our support for such an initiative. Right now, we are in a Catch-22 situation. It is not illegal for young persons to purchase, consume or possess cigarettes, as is the case with alcohol, but at the same time, we are prohibited by law from asking for this type of identification. You can see the dilemma. Therefore, we ask that clause 8 of the bill be amended.

We are also concerned about in-store advertising. Some of the provisions in the bill are incredibly absurd. With respect to pipe tobacco, for example, it would be illegal to sell a pipe tamper bearing the Dunhill logo. I am sorry, but no one else makes pipe tampers. From a marketing standpoint, some of these provisions are totally ludicrous.

In so far as responsibility for tobacco promotion is concerned, we ask that the word "retailer" be removed from this provision. The retailer should not be held responsible for products supplied to him by recognized Canadian manufacturers, regardless of any decisions that have been made as to what does or does not constitute legal promotion. However, if ever a tobacco censorship board or committee is created -- we have a film censorship board, so why not have one for tobacco -- obviously we would like to be involved simply to let you know what is logical and what is not.

We subscribe to a basic principle: the customer entering our premises to purchase a tobacco product has already made up his mind to smoke. He only comes into the store to select a particular brand. Basically, the message that I am trying to get across is that retailers should not be penalized to the same extent as the manufacturers who produce the promotional material displayed in our stores. Since this material is supplied to us by manufacturers who are recognized by the Government of Canada, there is no reason why this material should not be on display. Imagine how complicated it would be to monitor every retail outlet.

On the subject of responsibility, our final comment concerns in-store inspections, similar to those targeting flue-cured tobacco farmers. The legislation would allow inspectors to enter and search our retail premises without a mandate and without authorization from a higher level. A significant number of inspectors already come through our stores. We are responsible for the safety of the food we sell. However, if a product comes to us from a reputable manufacturer, we cannot be held responsible for it. We purchase the product in good faith. Here again, the retailer should not be held accountable. We do not object to general inspections, given our problems with cigarette smuggling, and we are quite happy to see inspectors do their job. It is quite easy to look for a government seal. In Canada, a cigarette package or carton cannot be sold if it does not bear a seal. The presence of a seal indicates that the tax has been paid and that the product has been registered in Canada.

There are already enough control mechanisms built into the system. We do not need to hear that we will be held responsible to the same extent as the manufacturer if a problem arises with a tobacco product. When we purchase a product, we do so in good faith. That concludes our presentation. Other questions will certainly arise as to the practical impact of the legislation. The government must not shift its responsibilities on to someone else's shoulders. It must stop looking to the retailer and claiming that his job is to be a government tax collector, inspector and police force all rolled into one. Our mission in life is to sell products quickly to our customers and to do our job well. That is what really matters to our customers and what saves our jobs.

If retailers were forced to bear all of the responsibility each time new measures were introduced, their businesses would not survive. They will end up having to spend the better part of their time on accounting and police work for the government.

[English]

Professor Wayne Renke, Faculty of Law, University of Alberta: Honourable senators, I am grateful for the opportunity to speak with you today, and I hope that I shall be of some small assistance. I shall be directing my remarks at two main sets of issues concerning Bill C-71. The first issue relates to the presumption of innocence protected under section 11(d) of the Charter, and the second issue relates to the right to be secure against unreasonable search and seizure, protected under section 8 of the Charter. I have submitted a brief which will amplify many of the points I will be making this morning and which will also address matters that I will not have an opportunity to deal with in my oral presentation.

I will preface my remarks by pointing out the centrality of context to an assessment of the constitutionality of Bill C-71, the proposed Tobacco Act, as I will be referring to it.

Context is relevant to the determination of the scope of Charter rights and to the justifiability of infringements of those rights by legislation. You might ask why context ought to matter. You might say that a prosecution is a prosecution, a search is a search, the state should interfere with us as little as possible, and the Charter should protect us all equally from state interference.

The basic rejoinder to this position is that participants in a heavily regulated industry, like the tobacco industry, have a different relationship with the state than those outside such industries. Ordinary activities, one might say, are presumptively harmless until the state proves otherwise. Activities of the tobacco industry, given the legislation and the findings of the Supreme Court of Canada, are presumptively dangerous. Therefore, significant state involvement with industry processes is required. The state must be present with tobacco industry participants at all industrial stages, from manufacture through sales. The state is not external to the tobacco industry; it is intimately bound up with its operations. This suggests that, as a general principle, we should not use the Charter to hold off the state from tobacco industry processes as we would hold off the state from our private lives.

With this context in mind, I turn to the provisions of this bill that may threaten the presumption of innocence.

The presumption of innocence is a fundamental legal right -- perhaps the fundamental legal right. It entails that persons may be convicted of offences only if the prosecution establishes guilt beyond a reasonable doubt. An accused is entitled to an acquittal if, on all of the evidence, there is a reasonable doubt respecting guilt.

Now, subclause 53(2) of Bill C-71 gives rise to some serious concerns relating to paragraph 11(d) of the Charter. Subclause 53(2) imposes on an accused the burden of proving that an exception, exemption, excuse or qualification operates in the accused's favour. This provision is internally limited in that it applies only to what might be called special statutory or regulatory defences and not to general defences available to all accused.

Subclause 53(2) does, however, require an accused to prove a special defence on a balance of probabilities. Ordinarily, an accused, absent a provision such as subclause 53(2), would only be required to raise a reasonable doubt or would only have to point to evidence raising a reasonable doubt to be acquitted. It is fairly clear that subclause 53(2) appears to allow conviction despite the existence of a reasonable doubt. It therefore appears to violate the presumption of innocence.

Context does not dictate any diminution of an accused's right to be presumed innocent in prosecutions under this bill. The bill sets out some very serious penalties, as high as a maximum fine of $300,000 and two years' imprisonment for certain offences. I should add that these fines and the possibility of imprisonment are as high or higher than penal provisions relating to what might be termed true crimes. I should also note that Chief Justice Lamer has indicated that imprisonment is imprisonment whether it is imposed under a regulatory statute or under a statute that creates a true crime.

The bill also relies fairly heavily on summary conviction offences and hybrid offences. This might not seem significant but what this tactic does is deny accuseds trial by jury, as well as trial in superior court and preliminary inquiries in provincial court. Given the serious penalties that accuseds face under this bill and the lack of procedural protection since summary conviction procedures are relied upon, evidential protection such as the burden of proof ought to be maintained in order to compensate.

I should note that there are some cases, even as high as the Supreme Court, that hold that provisions similar to subclause 53(2) do not violate the presumption of innocence; however, if these cases are right, they should be confined to their special facts. We do have other indications from the Supreme Court that are supportive of this argument.

If subclause 53(2) does infringe the presumption of innocence, it cannot be sustained under section 1 mainly because it does not involve a minimal impairment of an accused's rights. There are equally effective ways of allowing an accused to establish special defences. In particular, an accused could be allowed to point to evidence raising a reasonable doubt as to whether a special defence is available. If it is available, the Crown could then rebut the availability of the defence on its normal standard of "beyond a reasonable doubt". In my view, the simplest way to correct the difficulties arising from subclause 53(2) is simply to eliminate it from the bill.

Subclause 8(2) and clause 54 of the bill also impose burdens of proof on the accused to establish defences on a balance of probabilities. I should note that subclause (2) of clause 8 is not felicitously drafted. It has lost its connection to the defence of mistake of fact, which it was presumably designed to particularize. I should also note that there appears to be a typographical error in clause 54 of the bill. There is superfluous language which is confusing and ought to be eliminated.

On the last page of my brief, I have summarized my recommendations relating to amendments to the bill, subclause 8(2) and clause 54 in particular.

Both subclause 8(2) and clause 54 violate the presumption of innocence. Both allow for the conviction of an accused despite the existence of a reasonable doubt. I suspect, though, that both provisions will be justified or could be justified under the Charter given an accused's special knowledge of the pertinent circumstances and the prosecution's lack of knowledge of those circumstances. Moreover, there is some Supreme Court authority recognizing the constitutionality of strict liability in regulatory statute contexts, which appears to be the context in which we find subclause 8(2) and clause 54.

The forfeiture provisions of the Tobacco Bill involve a definite allocation of a burden of proof to persons from whom goods have been seized. I should note that the Tobacco Bill marks a conceptual shift from the forfeiture provisions of the Tobacco Products Control Act. Under the Tobacco Products Control Act, the state had to take positive steps to initiate forfeiture. Under the current proposals, owners or persons from whom goods have been seized must take positive steps to avoid automatic forfeiture. A person from whom goods have been seized has 60 days from the date of seizure to commence proceedings to preserve his or her rights. The owner bears the burden of establishing entitlement to goods in proceedings.

Comparable provisions in the Narcotic Control Act have been reviewed by the Supreme Court, although under the Canadian Bill of Rights and not the Charter. Under the Canadian Bill of Rights, the court did not find these provisions comparable to the proposed forfeiture provisions of the Tobacco Bill. The court did not find these provisions to violate the presumption of innocence, at least so long as the only burden imposed on the owner was to establish civil possessory rights to the goods.

Under the proposed forfeiture provisions, which again do provide for automatic forfeiture in some cases, the burden appears to establish simple possessory rights. Given the Supreme Court's indications on this issue, it is likely that the forfeiture provisions will survive Charter challenge.

I shall now turn to issues relating to search and seizure.

Under section 8 of the Charter, everyone has a right to be secure against unreasonable search or seizure. Context is vital in assessing the scope of section 8 rights. There is ample authority supporting the position that participants in heavily regulated industries, like the tobacco industry, have a reduced expectation of privacy respecting their business activities and premises. Nonetheless, participants in the tobacco industry still have rights to be secure against unreasonable search and seizure.

The Hunter v. Southam case established that the reasonableness standard under section 8 ordinarily requires search and seizure legislation to satisfy three main criteria. The search and seizure must have received prior authorization, typically through the issuance of a warrant; the authorization must have been granted by a person acting in a judicial capacity possessed of the requisite independence and discretion; and the authorization must have been based on information provided on oath, establishing reasonable grounds for believing that the place to be searched contained evidence relative to an offence.

The proposed bill contains two procedures which must be judged against the reasonableness requirement of section 8. The bill provides for inspection of a dwelling place with a warrant. The inspection powers, though, are fairly carefully circumscribed. Not just any home is subject to inspection, rather, only those dwelling homes having, on reasonable grounds, connection to the tobacco industry. The inspection authorization procedures allowing for the issuance of the warrant follow Hunter v. Southam relatively closely. The procedures do require prior authorization. The prior authorization is granted by a judicial officer. The authorization is granted on reasonable grounds established on oath, though once again the drafting of the reasonable grounds requirement could be improved.

The main departure in the warrant issuing procedures in the proposed bill from the Hunter v. Southam standards is that the inspection need not concern any offence. One might respond that that is the whole point of inspection. However, before continuing with the justification of inspection, I will set out the second type of search and seizure provisions in the proposed bill. This is inspection without a warrant.

Once again, the inspection powers are circumscribed. Inspection cannot be made of a dwelling place without a warrant. There must be reasonable grounds for believing the place to be searched has a connection to the tobacco industry. The inspection must take place at a reasonable time. The inspection is not a full-blown search, although inspectors do have the right to go into computer data bases, search for information and request the opening of items that may contain tobacco products. Inspectors cannot use force to enter premises.

While these factors might tend to support the reasonableness of warrantless inspection, there are some countervailing considerations. In the course of inspection, inspectors may find evidence of offences. The bill does create approximately 20 offences. The penalties may be very harsh, and there are also penalties for non-cooperation and for obstruction of inspectors. One might wonder whether warrantless inspection or inspection under warrant could be said to be reasonable when it appears to put industry participants in fairly serious penal jeopardy. In my view, both the warrantless inspection procedures in the proposed bill and the warranted inspection procedures are reasonable.

The tobacco industry participants are not in the position of ordinary citizens who are trying to keep the state away from their private lives. The state is already inside the industry and already deeply involved with all of its aspects. The tobacco industry deals with a dangerous product, and the safety of Canadians demands that measures be taken to ensure regulatory compliance before problems occur or before problems grow and become unmanageable. Without inspection, pre-offence visits and examinations, the provision of information and guidance by inspectors, the state would come upon the scene too late. As under the criminal law, intervention would occur only after the damage has been done.

Those are my submissions.

Senator Kenny: I wish to raise a brief question with Mr. Gadbois.

After listening to your presentation, sir, I have come to the conclusion that you and the people you represent do not want to undertake what seems to me to be your fair share of obligations in protecting the youth of Quebec from the dangers of tobacco. This concerns me inasmuch as 40,000 people die each year from tobacco, 11,000 of them in the province of Quebec. Given your final remarks, you seem to be assuming too many of the responsibilities in the process of dealing with this issue belong to government. Are you advocating that cigarettes should be distributed in the province by some agency like la Societé des alcools du Quebec, which, for non-Quebecers, is how expensive wines and liquor are distributed? It is managed by a government agency.

Mr. Gadbois: Is that it?

Senator Kenny: That is a start.

Mr. Gadbois: With respect to part one of your "fair share" question, my only reaction is to ask: Where is the sharing? If we had a fair share, someone else would be responsible besides ourselves. No one else is responsible, not even the minor who smokes. Basically, you have a situation where the law is dealing with secondary aspects of an activity which are criminal but the main aspect is not.

We are responsible for not selling to minors, but minors are not being held responsible for not buying or not consuming. We have two good examples here with that question.

First, there is a law in Quebec on alcohol. There is an example where minors are controlled or at least they incur some kind of serious penalty if they purchase or consume the product. At that level, our track record is very good. We rarely experience problems or are notified by la Société des alcools du Québec, which is responsible for that in Quebec, that there have been problems simply because we assume that placing a certain level of responsibility on minors informs them that the act is deemed criminal, since it is for us to sell.

Second, I am glad you raised the SAQ as an example. We are licensed to sell beer and wine in Quebec. The state gave us the right and the permits to sell alcohol. The responsibilities of alcohol purchase are shared with consumers, which is not the case for the tobacco issue. In the case of tobacco, the person who purchases the product does not share the responsibility.

We are not saying that we do not want the responsibility, because it is part of doing business, but right now inspectors from the federal government are having a field day in Quebec trying to entrap members in our organization for selling to minors. They are doing a very good job. I can show you young men and women that you would not believe are under 18. Do not forget that usually in the business that we operate we have maybe five, six or ten clients waiting to be served. It is sometimes difficult for us just to manage to serve them correctly, never mind having to say, "I am sorry, I think you are a minor. Could you please show me an identity card?"

By the way, it is unlawful for me to ask for the only piece of identification that I would believe. I would be penalized for so doing.

Do you see the kind of Catch-22 in which we are involved? We are asking you to, first, ensure that there is some kind of valid card for which to ask; and, second, criminalize the act to minors. If you want to stop them, then it should be clear to them that they may have rights, but they also have responsibilities. Their parents, teachers and everyone else in society should be held responsible -- if that is what we want -- for giving them cigarettes or allowing minors to smoke. What kind of society do we live in where parents give cigarettes to their children, but the only one penalized is the retailer? It is also a burden in the economic sense because penalties are high enough for us to lose our business.

Senator Kenny: Have you accepted or rejected the SAQ option?

Mr. Gadbois: I have rejected the SAQ option because we are dealing with it already, and we are doing a good job of it.

Senator Kenny: Dealing with the substance of your argument, first, in this legislation are penalties and restrictions that apply to manufacturers.

Mr. Gadbois: Yes.

Senator Kenny: They are restricted in a variety of ways.

Would you also agree that it is fair that the people who are making money from this product that kills so many people should bear the burden of the regulation?

Mr. Gadbois: I would not phrase it the same way. I would say manufacturers have a burden of responsibility which is equal to society's responsibility.

Senator Kenny: Let us look, then, at some of the other offences that a young person might commit and how the courts tend to treat young people when they do commit other offences. For example, a young person has stolen $800 from, say, one of your stores. What sort of punishment would the courts hand out to that individual? What would happen on a first offence?

Mr. Gadbois: It depends if it is stealing or using some kind of force to steal.

Senator Kenny: No force; they just took the money, but it is still $800. I am saying that they are likely to get an absolute or a conditional discharge. Do you really want to start criminalizing young people at this age? Are there not other ways that we can be dealing with them?

Mr. Gadbois: You are raising a whole new set of issues.

Senator Kenny: Yes.

Senator Nolin: You should probably ask this question of a lawyer.

Senator Kenny: That is fair, but the witness is asking us to criminalize the purchase of cigarettes by young people.

Mr. Gadbois: I am not saying that. At our age, we tend to forget how we were at 14 or 13. It is terrible, but that is how things are in society. Education has done a great deal. Most young smokers today were dealers of contraband when the taxes of 1991 were implemented. They were the dealers because no one could touch them. We dealt with contraband in a hard way in Quebec. Do not forget that when it was over, 80 per cent of the cigarettes sold in Quebec were contraband cigarettes. The government realized that it was losing money hand over fist so it lowered the tax, but it has started to re-introduce the tax.

Eventually, people stop smoking. They start young. They start probably younger today for many reasons. Education is probably the best way for youngsters to avoid starting to smoke. Coercion has never been the best way. You are asking me if I am comfortable with criminalizing the purchase of cigarettes by juveniles; I am not. However, if you are criminalizing one sector of society then criminalize everyone, because everyone is responsible. Where is the logic?

Senator Kenny: This is the very point that I am challenging you on. I am suggesting that it is fair and reasonable to criminalize you or the organization you are representing, because you are profiting from it.

In terms of how we deal with youth, there are other ways to get them not to use the product.

Mr. Gadbois: If government is really coherent, criminalize the product, period. It is clear to me. You criminalize use of the product once and for all and you will see whether or not society will live with it. I guarantee you that it will not and everyone will be criminals.

Senator Kenny: We understand your position.

Mr. Gadbois: Government is not being thorough in its thinking. Government knows it cannot cope. They say, "We will fine the retailer, and this guy or this woman will be responsible because we cannot apply the law, or enforce law, or control things. At least we will make someone responsible because he is linked somewhere in the process by making money out of it." That is not the issue. The issue is stopping people from smoking. You will not stop people from smoking with that approach. All you are doing is touching our economic well-being. Part of it is related to cigarettes, but you will destroy businesses.

We have had students who are 16, 17 or even 18 working in our stores at night who are not observing the law because they know the youngster who comes in and they sell to him. There are many ways for us to get caught in that system. We are saying that the responsibility is not even shared by the one who asks for the product, as is the case for alcohol. What is the reason for not doing it with tobacco if you do it with alcohol?

I sympathize, sir, with the complications you describe. I think they are real and difficult to resolve. I do not share your view that cigarettes should be criminalized for young people, but I do respect the point that you have made about how difficult it is for a clerk dealing with the situation at the time. Having said that, I think that is part of the price that you and your organization have to pay if you are going to sell cigarettes.

[Translation]

Senator Nolin: You indicated that you have some concerns about the age of your workers, that is about those who pick tobacco. Are you concerned because of a specific provision in the bill or simply because of the legislation's general thrust?

Mr. Ducharme: The bill includes prohibitions on posters and stickers on automobiles. Apparently an 18-year old should not be exposed to advertising of this nature. The bill is not clear on the issue. Will young persons be able to work in the tobacco industry if they cannot be exposed to tobacco advertising? That is what we are wondering. Overall, the bill would appear to indicate that this is the case.

Senator Nolin: Therefore, it is not one clause in particular that has given you reason to be concerned.

Mr. Ducharme: No, no single clause. We are concerned about the definition provided at the beginning of the bill. Included in the definition of "tobacco product" are tobacco, tobacco leaves and seeds and so forth. The minimum age listed is 18 years. Combine these two elements and the result is that an 18-year old may perhaps not be allowed to work in the tobacco fields.

Senator Nolin: You mentioned the age of your employees. How many of the employees who work for Alimentation Couche-tard are between the ages of 16 and 18?

Mr. Gadbois: I could not tell you exactly. I have been told that the figure is 40 per cent.

Senator Nolin: Forty per cent of your workforce is between 16 and 18 years of age. When these persons are on the job, are they alone or working with older persons?

Mr. Gadbois: Mr. Bouchard will correct me if I am wrong, but generally speaking, these youths work in the evening, often after 11 p.m. Many convenience stores are open 24 hours a day. These jobs provide extra income for many students who take advantage of their flexible class schedules at CEGEP or university. In answer to your question, yes, they often work alone in these stores.

Senator Nolin: What steps have your store and others taken to train employees to request some I.D.?

Mr. Gadbois: All prospective Couche-tard employees undergo a comprehensive training program. The identification issue has proved to be a major problem. In some cases, inspectors have deliberately brought in minors to put various stores to the test. Couche-tard has not been spared. We contact our members on a regular basis to remind them of the dangers and of the controls that they must have in place. Retail outlets that belong to a chain are more organized.

Senator Nolin: What exactly do you mean?

Mr. Gadbois: I am referring to retail outlets that own a franchise and who purchase most of their products from a group of distributors. Métro is an example of a large chain store. In the category of smaller franchises, we have Provi-Soir, Couche-Tard and Boni-Soir that operate across the province.

Unlike what we see in the rest of Canada, approximately 80 per cent of Quebec retailers own their own business. They are independent owners who operate in association with a supplier. Elsewhere in Canada, only 20 per cent of retailers own their own businesses. The rest are owned by large corporations.

In Quebec, there are 10,000 retail outlets, or twice as many per capita than elsewhere in Canada. In addition to receiving general regulatory information from us, the chain stores are the ones that provide training to their employees.

Senator Nolin: Yesterday, we heard from a witness who told us about a proactive program developed by tobacco manufacturers to help retailers carry out their responsibilities in terms of identifying the age of cigarette. Were you involved in this initiative?

Mr. Gadbois: Yes, but on an independent basis. We were already doing this.

Senator Nolin: No law required you to do so.

Mr. Gadbois: You may recall that approximately three years ago, we proposed that the legal age be upped to 18 because this was easier for us to monitor. However, this does not resolve day-to-day problems. It is crazy to think that we will be able to prevent young people under the age of 18 from purchasing cigarettes. No monitoring system is foolproof. It is not illegal for someone else to buy the cigarettes, as it is in the case of alcohol. It is not illegal to ask an 18-year old friend to buy cigarettes. That is what happens in most cases. It is not difficult for us to correctly identify young people. The thing is, a third party will be able to make the transaction. If 80 per cent of cigarette sales involve smuggled cigarettes, imagine how futile this exercise will be in the case of the small Canadian market of youth smokers. However, if you do go ahead with this initiative, you should ensure that responsibility is shared equally and that young people are taught that if the government says it is illegal to sell cigarettes to them, it is also illegal for them to purchase them. That is only logical.

I understand that this may appear excessive up to a point. However, follow through on your convictions and ensure that the process is illegal.

There is one principle in our society that must be imparted to young persons: with rights come responsibilities. One person cannot always be made to shoulder all of the responsibility simply because that person stands to gain something. What does this say? You know as well as I do that this will not resolve the problem.

To have a clear conscience, the legislator has deemed that one person is responsible and that that person is the retailer. Even the police's hands are tied. Neither parents nor the school boards have a role to play. Even the youth protection service supply cigarettes free of charge to minors housed in government facilities.

Senator Nolin: Which service is that?

Mr. Gadbois: I am talking about the youth protection service which works with youths under the age of 18. Instead of being sent to prison, young persons are detained for a period of time in special residences, whether it be for 24 hours, a week or several months.

You can check for yourself, but I believe each resident who submits a request receives an allowance. Many crazy things happen, but I am not here today to talk to you about that. Crazy things happen in life in general.

We are here to defend ourselves. We are asking you to be reasonable and to have all members of society share the burden of responsibility equally. That is the logical thing to do. We have focused a great deal on clause 8. However, section 53(2), as the professor mentioned earlier, deals with offences and punishment. In this particular case, the burden of proof has been placed on us.

Senator Nolin: It has become your responsibility.

Mr. Gadbois: Yes. The retailer is specifically mentioned. I cannot be held responsible for a legal promotion designed by manufacturers, manufacturers recognized by the government, who happen to come into my store. Where is this going to end? I will be forced to spend my time inspecting and analysing. Do I have the necessary tools to pass judgement? I will be forced to spend the better part of my time acting as the government police and the government tax collector. What happens to my business and my competitive position in the meantime?

Senator Nolin: The points you raise concerning the understanding business have of the law, among others, are certainly valid. Have you conveyed your comments to the health department? Have you been consulted in that regard?

Mr. Gadbois: Yes.

Senator Nolin: How and when did that consultation take place?

Mr. Gadbois: There was a process to question the use of identification cards. In Quebec, the use of identification cards has been publicly discussed for a certain time. The various organizations agreed to study the proposals submitted to the parliamentary committee that is holding hearings at this time in Quebec. In our brief, we recommended issuing universal identification cards as probably the best way of settling the problem. The State may also decide that the use of such cards is possible; there is the health insurance card with a photograph, which is probably one of the easiest to monitor and one of the most serious; the driver's licence for young people can vary, since they can obtain it at 16, and not always 18 years of age. But it is very clear that it is forbidden to ask for an identification card for a purpose other than the one for which it was conceived. We propose two options: that the regulation be changed so that we can ask for the cards, because we are liable for the payment of penalties, there are certain preset monetary penalties; or that a universal identification card be developed that we can use without having to fear that we are breaking the law. We have appended the brief we presented to the parliamentary committee to our document.

[English]

Senator Jessiman: Mr. Gadbois, in terms of sales to minors, are you saying that the sale of alcohol is not as onerous on the retailer as is the sale of cigarettes?

Mr. Gadbois: That is correct.

Senator Jessiman: As retailers, what would you think if cigarettes were sold in a similar manner to alcohol? Or what would you think if it were available in every drug store and every corner store?

Mr. Gadbois: I do not represent pharmacies, but you can understand that I would love to see drug stores not being able to sell the product, since they are invading our territory whenever they sell food. I would make the joke that in Quebec, as you know, at least wine and beer are sold in our stores. There is a restriction as far as specific types of wines are concerned. If the situation were the same with regard to cigarettes, where you have grand cru for a good year and tabac jaune, I would say the prices would have to be high. Cuban cigars would be in that category. Obviously, there are no such restrictions for cigarettes.

Yes, we still want to sell cigarettes. As far as we are concerned, it is a legal product. What we are saying is that there are fewer instances of minors purchasing alcohol in our stores because alcohol is illegal for minors. They cannot be seen with it or holding it. If they are, the police are allowed to arrest them. This is not the case with cigarettes. That is probably why we do not have a high incidence of minors trying to buy alcohol products, which is not the case for cigarettes. If it were illegal for youngsters to buy, purchase or consume cigarettes, then, obviously, they would not just feel comfortable buying it, leaving the store or even have someone buying it for them, like we all did with beer when we were under 18. We had someone with facial hair in our group and he would buy beer for us and we would drink it. I do not think I am the only one who did that. Teenagers still do that today. With cigarettes it is probably the same thing. Someone can buy cigarettes, give it to a minor inside the store and they are scot-free. They can say, "Neither one of us has broken the law."

The Chair: If someone over the age of 18, even though it is not the retailer, sells to another person, they have committed a breach of this law.

Mr. Gadbois: Yes, but are they selling? When do you know a transaction has taken place?

The Chair: The bill states that no person shall furnish, which means to provide a tobacco product to a young person. That is what the bill says. I want to make sure we are talking about the law here.

Mr. Gadbois: The only problem is that that is the way it is done, and it will continue to be done in that way.

The Chair: It is illegal.

Mr. Gadbois: Yes, but no one will arrest them.

The Chair: No more than they will arrest you, unless someone is in there when the legislation passes.

Mr. Gadbois: They are.

The Chair: Then they will also arrest this person.

Mr. Gadbois: No. It is easier to do than to go on the street. Can you imagine trying to do that on the street with people? Are they even allowed to ask a minor for some form of identification?

We are affected directly by clauses pertaining to dwelling houses, because many small stores are under the dwellings of individuals. Basically, when you enter the store, you are entering the dwelling. I would say it is the case for about 2,000 dépanneurs in Quebec.

I am trying to make you aware of all the complications. Our business is to sell. We have responsibilities. We respond to these responsibilities. We have done it with alcohol. Now you are asking us to be responsible for promotion inside our stores. You are asking us to be responsible for the nature of the product within the package inside our store when we are buying it openly from well known manufacturers. Finally, you are asking us to be responsible for identifying the correct age of someone when, first, we are not even allowed to ask for the correct papers from the person and, second, the person who is buying is not precluded from buying legally.

Senator Jessiman: The tobacco companies yesterday said that they were spending about $1.5 million a year to try to assist retailers in not selling to minors. Are you familiar with that?

Mr. Gadbois: I do not know how they spend it.

Senator Jessiman: They said they are having some success with that program. You are the people that they said they were trying to help, that is, retailers.

Mr. Gadbois: My members pay me to make sure that they are well informed, which is what I do. I do not know how the manufacturers spend that $1.2 million. It is probably related to some form of pamphlet or information that they publish or put together. Frankly, I do not believe it is their responsibility. They manufacture the product.

Senator Nolin: However, they have done it.

Mr. Gadbois: They have done it.

Senator Nolin: Without being forced to do it.

Mr. Gadbois: Bravo.

Senator Nolin: Exactly.

Senator Jessiman: Do you not think retailers should have some responsibility to try not to sell to minors, even though you are saying they should not be the only ones responsible? Surely you have some responsibility to the people to whom you are selling the product, notwithstanding that it is all packaged when you buy it. You should have some responsibility not to sell to minors.

Mr. Gadbois: That is what I said to Senator Kenny. I said yes.

He specifically mentioned fair share. I do not think it is a fair share. We want to share. I feel a great deal of resistance to the fact that it should be criminalized to sell to those under 18. I said, "Let's be logical here, otherwise we'll never have our fair share." If it is the case for alcohol, then it should be the case for tobacco, and other people should be concerned with that issue. We should not be the only group involved. You might satisfy yourself economically in linking us to that, ensuring that a responsibility is there because we make money out of it. However, you will never solve the problem. We must think as a community, beyond just ensuring that it is applied and there is a logic there and it will be settled. We will have the same problem in 10 or 20 years' time. If we want to solve it, we should do it seriously and globally, or we should forget about it.

Senator Jessiman: Yesterday, counsel on behalf of the tobacco company said that if this bill is not amended, there will be a court challenge. In particular, they made reference to entry without warrant, seizure without warrant and the reverse onus provision to which you referred. What is your view on whether they will have some success in that regard?

Mr. Renke: Certainly they can litigate these issues. There is nothing stopping them. My prediction is that they will meet with success on the general reverse onus provision in subclause 53(2). My expectation is that they will not meet with success on the warrantless inspection provisions of the act for the reasons I have indicated.

In respect of the search with warrant provisions, the act does come fairly close to the criminal law constitutional standards, with the exception that inspections are not necessarily done for the purposes of determining whether an offence has occurred. The main issue will be in relation to the regulations without warrant.

Again, given some past decisions of the Supreme Court, there is a tendency of the court to recognize that, in regulatory contexts, persons have a reduced expectation of privacy. My view is that even the warrantless inspection provisions will be sustained, though these are certainly arguable issues. I am not saying these are obvious issues one way or another.

Senator Lewis: It is interesting to hear of some practical problems which may arise.

Mr. Ducharme mentioned the problem of young workers under clause 8, I believe. I would point out that there is nothing in that clause preventing a person under 18 from handling the tobacco products. As a matter of fact, there is no prohibition against possession of tobacco products; it is only the selling or furnishing where the penalty applies.

This leads to another point. Mr. Bouchard mentioned the question of shared responsibility. Are you referring there to the shared responsibility between the retailer and the purchaser?

Mr. Gadbois: We share a responsibility for the promotional material in our stores, or what would be considered promotional material of products, ranging from lighters to posters. We share that responsibility with the manufacturer.

Senator Lewis: This is my point.

Mr. Gadbois: On that issue, as we propose in our memorandum, we believe that there should be some form of control. The product is already controlled, but we should make it controlled by a board. Once we receive products and publicity from recognized legal manufacturers, we believe we have a right to presume that these products or materials are legal. If every retailer were required to check the products and publicity, he would have to call his lawyer to verify whether it is legal. It will never end. It is clear in the clauses referring to promotional activities in our stores that we are also responsible.

We are saying that we do not know the best way to deal with it, probably a control board of some kind, but please, retract or take away the word "retailer" so we are not held responsible for those products or that material. The manufacturers are legal or recognized entities with licences, et cetera. We presume that there should be a control there. They should know whether what they sell or give us as material is legal.

Can you imagine a corner store where the owner and his wife had to check every piece of material related to tobacco or publicity of tobacco and ensure that it is legal?

Senator Lewis: Some of these things will probably be covered in the regulations when they come forth.

Mr. Gadbois: Instead of waiting for regulations, why not take us out of the application of the clause itself? We do not see the logic of our sector being responsible for legal products that we are receiving, especially if they are promotional products or what have you.

Why must I check to see if the match box that I get is legal or not? If it has a Players or a du Maurier logo on it, how can I check if it is too big or too small? I should not even get it if it is not legal.

Senator Lewis: I presume that the same thing applies under the Food and Drugs Act. I do not know if this comes under that, but chocolate bars, breads, and pies must have certain ingredients, I believe.

Mr. Gadbois: That is mostly based on the make-up or the contents of the product itself.

Senator Lewis: You cannot go and check all that. You must accept that when you get the product.

Mr. Gadbois: Again, in clauses 15(1) all the way to 33(f), it is clear that we are held responsible. We are saying, "Please take retailers out of the list of people responsible for those products." This is not an amendment, but we are suggesting that if you want to have some form of control, you might want to form a control board. If you have a control board, we might have something to say about what is correct and incorrect for retail because it affects our business.

Senator Lewis: Just following along from that point, we heard from representatives of the manufacturers yesterday. They seemed to take the view that they manufacture the noxious substance and do the promotion and the advertising in order to make sales, but it is then up to the retailer.

Mr. Gadbois: I should talk to them because we are their clients.

Senator Lewis: Do you think there should be more responsibility on the part of the manufacturers?

Mr. Gadbois: I presume that all the material that is produced, made or created by manufacturers or their agencies should be subject to some norms, and they should follow them. If they do not follow them and I receive their products in my stores, what can I do? On a daily basis I cannot ask each of the 10,000 retailers in Quebec to check with their lawyers to see if what they are getting complies with the law. Basically the clauses in the bill are very clear on that point. I am as responsible as the manufacturer once I put these products, the promotional material, or what have you on display.

Senator Lewis: Regarding shared responsibility between the retailer and the buyer, do you feel that a penalty should be placed on the buyer where it is determined he is under age? Would you go so far as to say that there should be a complete ban on possession of tobacco by young people?

Mr. Gadbois: If you want our fundamental position, I refer you to our memorandum on page 4, which is basically a judgment from Judge Brassard. I will read it in French because I am more comfortable in French:

[Translation]

Parliament may not criminalize the secondary aspects of the principal activity if it has not criminalized that activity.

[English]

That means basically that the main activity here should be illegal and that is buying the product. It is considered criminal for us to sell the product. That is what they mean by saying that the secondary activity is criminal while the principal activity is not.

We are saying you either criminalize it or you do not. We are in the secondary activity here, even with the promotion and so on. The main activity is not considered criminal because youths are not criminals if they smoke the product, own the product or buy it, so why is the secondary activity considered criminal? Obviously, this point is the underpinning of our whole principle. We believe that the Senate will take into consideration all these issues, because they are fundamental commercial, economic and, to a certain extent, constitutional. However, if the bill passes as it is, we intend to go to court with these issues, because we think there are rulings that say that the clauses I mentioned cannot apply. It is very clear that they cannot apply. We want to support whatever the Senate will put together to make sure that there are shared responsibilities, that we are not singled out as being the only ones responsible, and that the clauses in the bill do not interfere with what we would say is reasonable business.

Those of you from Quebec will probably have seen our organization in the past. We were very active when we fought against contraband. For us, this is a dangerous series of clauses, and we will have to be much stronger in our interventions. We have followed the process to make sure that we understand exactly what the clauses mean. We believe, having done the work and identified which of these clauses will have negative effects for us, that you will amend them in such a way that they are reasonable and that they attain their objectives. If not, then that process will be ended as far as the Senate is concerned and we will have to get involved in other ways, and very strongly, as we did in the contraband issue. This issue affects our livelihood.

The application of some of the clauses, such as clause 53(2), will cause many businesses to close because of the burden. If the government is very strict in applying not regulations but the clauses here, many businesses will close, and that is not the purpose of the law.

Senator Lewis: You mentioned the question of displaying cigarette packages in the store. I am looking at an information sheet that has been issued by Health Canada, which says that in the government's consultative document, "Tobacco Control, a Blueprint to Protect the Health of Canadians", it was proposed that only one packet of cigarettes per brand be exposed for sale at retail. The purpose of the proposal was to reduce the inducement to youth to purchase tobacco products while at the same time providing adult customers with information regarding brand availability. During consultations with the retail sector on the blueprint, it became apparent that this proposal would not be practical and would involve additional expenses for retailers. As a result of the concerns expressed during consultations, the blueprint proposal was not carried forward into Bill C-71. Apparently you are not restricted to displaying just one package.

Mr. Gadbois: No, not at the moment. You have to understand the process that goes on in a retail store. Usually people who purchase cigarettes are already smokers. When they come in, they already have a need for their cigarettes. They do not make the choice inside our store to smoke or not to smoke.

Senator Lewis: Would you go so far as to say that cigarettes are addictive?

Mr. Gadbois: I would not say that. I smoked myself and I stopped. It depends on the type of addiction you are talking about. You could be addicted to many things. That is not the issue. We believe that, just as with other products, basically it is a selection between products, and marketing gives information specific to differences between products. That is what is on the cigarettes or on the displays of those cigarettes. That is the same as for other products. It could be a marketing ploy or whatever, but basically, you have smokers who come in who decide they want a milder cigarette on that day or a menthol cigarette because they have a cold, or they see there is a new type of filter and decide to try it. There is presently publicity on a filter that makes the cigarette less rough or easier to smoke. It is a great element of marketing. I was asking myself, if it is so rough, why do you want to smoke? Often people have made the choice that they want to smoke and they want a different type or brand of cigarette.

Our business is to offer to the consumer the selection that is on the market today. It is similar to the situation with yogurt, although many may find the comparison ridiculous. If someone comes in the store and does not want to buy yogurt, there is a good chance that the variety of yogurt that I offer him will not influence his choice because he is not interested in it. We are fighting to sell within a market, and I wish to distinguish myself within a market of people who are already smokers.

I treat it like any other product, as far as publicity or marketing is concerned. I want to make sure that I have the same variety of choice as my competitor next door because that is what keeps me in business.

The person who wants to purchase a bottle of milk, his newspaper, or whatever he buys on a daily basis, can do so. Half the population of Quebec goes through our stores in half a week. Basically, I want to make sure that they come back and they will continue to have a choice. One element that we put in our memorandum is that we are quick. No one wants to lose time buying food or whatever product it is. Often customers are in a hurry because it is a burden for them. We must be quick. Imagine what will happen when we have to line up people and we say, "We want to see IDs here." It will become a problem with certain stores and a source of competition with other stores.

Senator Beaudoin: My question is addressed to the professor at the Faculty of Law, University of Alberta and concerns what you said about clause 53. We have heard in the last few days that when there is a reversal of the onus of presumption of innocence, it is illegal or unconstitutional. This is not so. We may have a reversal of the onus of the presumption of innocence that is quite acceptable. If I am not mistaken, that is exactly what the Supreme Court did in the Laba case of 1994.

In other words, if the accused is obliged to establish beyond any reasonable doubt that he is not guilty, of course it would go against the Charter. Likely it would not be justified under section 1 of the Charter. However, if the accused is under the obligation to offer, present or invoke an excuse, or as stated in clause 53, some other "exception, exemption, excuse or qualification," then of course it is justifiable under section 1 of the Charter.

Do you as an expert agree or disagree with my statement?

Mr. Renke: I agree with your analysis. Perhaps I disagree in your application of the analysis to this particular provision.

Senator Beaudoin: You mean clause 53(2)?

Mr. Renke: Yes, and I shall explain what I mean.

First, you are absolutely right. If a statutory provision required an accused to prove a defence beyond a reasonable doubt, that would violate section 11(d) of the Charter, of that there is no doubt. However, keep in mind that there is not one burden of proof under the criminal law, but three. The "beyond a reasonable doubt" standard applies to the prosecution, the Crown, and the Crown must establish its case beyond a reasonable doubt before this conviction.

A second possibility is that a statutory provision may provide that an accused must establish a defence on a balance of probabilities. The defence or the accused must establish that his or her position is, on balance, correct. My suggestion is that clause 53(2) imposes that type of burden. It is what is sometimes referred to as a "persuasive burden", where the accused is required to establish a position on a balance of probabilities.

A third possibility, though, is where the statutory provision finds some fact to be the case, unless there is some evidence to the contrary. In that kind of case, the fact presumed under the statute is not presumed so long as the accused can point to some evidence which raises a reasonable doubt.

In the case of a persuasive burden, there seems to be strong authority that persuasive burdens do violate the presumption of innocence. This is because persuasive burdens allow a person to be convicted despite a reasonable doubt. How can that be? If an accused has the obligation under the statute to prove a point to the balance of probabilities, the accused may only have been able to establish a reasonable doubt. That is not good enough because the statute requires proof on the balance of probabilities. Despite the existence of the reasonable doubt, the accused can still be convicted; therefore, violation of section 11(d).

However, that is not the end of the story. There is then a balancing under section 1 of the Charter. It may well be that a statutory provision that imposes a burden on an accused of establishing a point on a balance of possibilities is justifiable in a free and democratic society. As an example, there is a presumption in the Criminal Code relating to impaired care and control of a motor vehicle. This statutory provision is along the lines that a person found in the seat normally occupied by the operator of the vehicle is deemed to have care or control unless that person establishes that he or she did not enter the vehicle for the purposes of setting it in motion. It imposes a persuasive burden on an accused, it violates section 11(d) of the Charter and is sustained under section 1 of the Canadian Charter of Rights and Freedoms.

The difficulty with clause 53(2) is that because it imposes a persuasive burden, it prima facie violates section 11(d) of the Charter. We then have to look to section 1 of the Charter to see whether this violation of section 11(d) is justifiable. The main difficulty that I have with clause 53(2) is that it is not necessary for the purposes of enforcing this bill that an accused be required to prove his or her defence on a balance of probabilities. It ought to suffice for an accused simply to be able to point to some evidence which, if believed by the trier of fact, would raise a reasonable doubt. The accused either has some evidence that there is some regulatory exemption or not. If there is no evidence of such an exemption, the person will be convicted. If there is some evidence, then let the accused point to that evidence and let the Crown take on its normal burden of proving the case beyond a reasonable doubt, showing that the defence, in the circumstances, does not apply.

Senator Beaudoin: This is perhaps where we disagree. I would go along with the general principle and with the Laba case. On the question of it being persuasive and a question of presentation, we also agree. Obviously, clause 53(2) goes against section 11(d) of the Charter. You disagree that that is established under section 1 of the Charter.

Mr. Renke: I disagree with that because clause 53(2) is drafted so broadly. We do not even know exactly what legislative purposes it is serving. One qualification to my position in my presentation was that there are other reverse onuses imposed under this bill. I did not say that those were unconstitutional. It may indeed be justifiable for the accused person to prove his or her provision on a balance of possibilities.

With all due respect to the practical difficulties retailers might have in determining whether or not someone is a young person, if a retailer is charged with furnishing a tobacco product to a young person, the bill provides for a defence of due diligence. In effect, though, the drafting of the current provision is not good.

The legislation provides for a defence of due diligence. In this particular circumstance, it is appropriate for the accused to bear a burden on the balance of probabilities. The accused is in possession of all the facts. The accused was there. The Crown will probably not be able to call anyone on the retailer's side to be a witness against the retailer; the person who purchased the material may not cooperate. This is evidence solely in the hands of the accused. Let the accused prove it. In the particular circumstances, my opinion is that the reverse is permissible, but not in a general matter.

Senator Beaudoin: Is it only in that case that you are inclined to disagree? There are some other reversals, but you are not concerned with them?

Mr. Renke: No.

Senator Beaudoin: The one you are concerned with is clause 53(2).

Mr. Renke: Yes.

Senator Beaudoin: It is a debate. Do you not think it is justifiable?

Mr. Renke: My reason for concluding that is that the clause is simply too broad. It does not specify the present problem.

Senator Beaudoin: The court will decide.

Mr. Renke: The court will decide, yes.

The Chair: Thank you to all of our panellists. We learned a great deal this morning.

We will begin with a presentation from the Alliance of Sponsorship Freedom, followed by the Artists for Tobacco-Free Sponsorship.

Mr. M. Max Beck General Manager, Ontario Place: Good morning and thank you for allowing us to come here to make a presentation today and participate in your review of Bill C-71.

My name is Max Beck, and I am the executive committee member of the Alliance for Sponsorship Freedom. Michelle Létourneau is with me and we also have Mr. Rick Dearden, who will be pleased to join us and answer any technical questions you may have regarding Bill C-71's proposed restrictions on sponsorship promotion and specifically to outline how Bill C-71 infringes section 2(b) of the Canadian Charter of Rights and Freedoms.

The Alliance for Sponsorship Freedom is an association of over 250 arts, sports, fashion, entertainment and cultural organizations, events and corporate sponsors which was formed last August to protect sponsorship rights.

I will say at the outset that the alliance supports the government's health objectives in Bill C-71 and we are not opposed to government promotions. We have lived with those objectives for a number of years, and as long as those objectives are reasonable, we are prepared to continue to live with them.

In the alliance's view, however, the proposed restrictions and absolute prohibitions in Bill C-71 are extreme and unreasonable since they amount to a virtual ban of tobacco company sponsorships.

According to a study commissioned from SECOR, a respected management consulting firm, just 20 key events across this country with tobacco company sponsorships contribute approximately $240 million to the Canadian economy and create 5,000 jobs, which are certainly needed. These events generate about $66 million in direct income to individuals and $18 million to governments each year in the form of taxes. In SECOR's view, these numbers represent a small fraction of the overall contribution of the events and organizations that receive financial and in-kind support from the tobacco industry, since over 370 organizations in Canada receive tobacco company sponsorship each year.

A great deal of the debate surrounding Bill C-71 is focused on the issue of replacement funding or the myth of replacement funding. I say "myth" because the vast majority of the $60 million at stake cannot be replaced by other corporations and Bill C-71 will force many events to be cancelled and most to be downsized significantly.

In response to Mr. Dingwall's challenge to Canada's major financial institutions, most revealed that they would be unprepared to replace these sponsorships, and they are the people that seem to have the most money nowadays.

As an event organizer in Canada who is in the business of asking corporations regularly for sponsorship funding, this does not surprise me, nor does it surprise any of the event organizers who are members of the Alliance for Sponsorship Freedom. I have a book here which is a small sample of the reject letters and the refusal letters that some of our members have received on a regular basis from people who are trying to acquire additional sponsorship. We are all facing government cuts and we are looking for sponsorships. To subtract a further $60 million from that budget is untenable.

There must be no misunderstanding that Bill C-71 will not lead to event cancellations. The organizers of the Molson's Indys in Toronto and Vancouver have already announced that 1998 will be the last year for those races in Canada because of Bill C-71.

We do not want to have to cancel our events and Canadians do not want these events cancelled. In fact, according to a survey by Insight Canada, 84 per cent of Canadians agree that tobacco companies should be able to sponsor events under a reasonable set of restrictions given the economic impacts that our events generate.

The members of the Alliance for Sponsorship Freedom firmly believe that events should be able to associate with and appropriately recognize their tobacco company sponsors. We believe that organizations should have the right to seek, accept or reject sponsorship funding from Canada's tobacco companies.

The alliance does not believe that tobacco company sponsored events influence smoking decision, since our events are about jazz, fireworks, film, motor sport, theatre, tennis, comedy, golf, music and dance. Our events are not about smoking cigarettes.

When Mr. Dingwall appeared on March 19, he conceded that young people do not start smoking because they see a poster of Jacques Villeneuve wearing a Rothman's logo. Yet in almost every circumstance, the same poster will be illegal under Bill C-71.

Other promotional materials that are prohibited include offsite signage which recognizes tobacco company sponsors, and promotions for sponsored events on television or radio, regardless of whether these programs have an adult leadership. Brochures, flyers and programs displayed in any public place, such as tourism kiosks or hotel lobbies; equipment used in sponsored events, like a race car and event merchandise and official souvenirs sold at events, which are an important part of our revenue, would be prohibited. Direct mailouts of tobacco company sponsored events would also be effectively prohibited because there is no way to guarantee that those mailing lists include adults only.

It will be illegal to publicly thank our tobacco company sponsor for sponsoring an event. I have brought a series of brochures that alliance members have, and all of these will be illegal after this bill comes into effect. I have looked through this list, and most of them are tasteful and not offensive to the public. I can show you my own brochure for fireworks, and it does not have anything telling young people that they should take up smoking.

While we do support the intent of the act to generally protect the health of Canadians, it is clear that we will not be able to promote our events as they need to be promoted both within Canada and, all important, internationally. It is obvious to me that I will not be able to replace the Benson & Hedges sponsorship of my particular event which brings 2 million visitors to Toronto's waterfront. We have a contract with them. We have $5 million a year over a ten-year period, and it is probably one of the biggest sponsorships in this country. I do not believe that I can replace that $50 million.

To give you an example, my next largest corporate sponsor is General Motors of Canada, a large corporation, and General Motors provides us with $250,000, a long way short of $5 million.

We believe that Bill C-71 can be amended to advance both the government's health objectives and to protect the hundreds of tobacco company sponsored events, including the economic, tourism and employment benefits that these events generate. We believe our amendments are workable and reasonable. The alliance submits these amendments to the Senate with the hope they will be seriously considered and passed back to the House of Commons.

I will now turn it over to Michel Létourneau who can elaborate on our proposed amendments.

[Translation]

Mr. Michel Létourneau, Director General, Festival d'été de Québec (Quebec summer festival): Thank you, Madam Chair, for having agreed to meet with us. I am the Director General of the Festival d'été de Québec du Maurier. I am proud to tell you that over the past two weeks our event was awarded two prestigious prizes, that of cultural enterprise of the year for job creation, and that of tourist event of the year in Quebec.

Our festival lasts 11 days, and employs over 800 artists in one or the other of the 400 different performances that are offered. The honorariums and expenses paid to artists amount to approximately $2 million. The Festival d'été de Québec injects or generates $39 million in economic spinoffs in the City of Quebec, creates 72 jobs a year, and allows 750,000 festival-goers to attend every summer, 60,000 of whom are from outside Canada.

A large part of the debate surrounding Bill C-71 has to do with young people and their smoking habits. Allow me to specify again that we are in perfect agreement with the health objectives of the government, but we have some reservations about the means used to reach them, and more specifically about clause 4 of Bill C-71.

It has been said on several occasions that the problems Bill C-71 causes for sponsorships are generally related to economic reality in Quebec and also only to large events. With your permission, I want to demystify those statements.

The problems involve organizations everywhere in Canada: large and small, large artistic organizations as well as small costume designers, large and small festivals, and international sports events. Just seven sponsored events in Ontario, according to the results of a December 1996 SECOR study, produce a 115 million dollar impact and create close to 2,400 jobs. In British Columbia, three events alone inject $23 million into the economy and create 450 jobs. As you can see, we are not only dealing with a Quebec phenomenon.

The Molson Indy races in Vancouver and Toronto inject $60 million into the Canadian economy and create hundreds of jobs. The organizers of those two events have already announced that 1998 would be their last year, because of the restrictions contained in Bill C-71. You will have the opportunity of hearing them tomorrow.

The Alliance for Sponsorship Freedom believes that Bill C-71 goes much too far. The restrictions it contains make the sponsorship of events by the tobacco industry commercially non-viable.

Moreover, any violation of the law makes those responsible liable for fines of $300,000 and prison sentences of two years for each day the law is broken. Who could afford such luxury?

As everyone knows, it is a reality in Canada that events such as ours cannot survive without the support of private partners. As one of the workers in this cultural industry, I can tell you that developing such partnerships with Canadian corporations is not an easy task.

Some people believe that the amounts we receive from the tobacco industry sponsorships are insignificant and can easily be replaced. I want to show how groundless some of those biases are, biases that are bandied about by individuals who no doubt do not have the experience I do and have not sought to obtain sponsorships.

Fifty per cent of the overall sponsorship budget of my event, for instance, comes from its partner du Maurier. The Tennis Open receives 80 per cent of its sponsorship portfolio from du Maurier. The Craven A Just for Laughs Festival of Montreal receives 50 per cent of its sponsorship budget from a tobacco company, the Montreal Jazz Festival, 45 per cent, and the Benson & Hedges International, 100 per cent.

Moreover, the sum of $100,000 that the 25th Street Theatre of Saskatoon receives is just as vital to that organization as the thousands or hundreds of thousands or millions that larger organizations receive. As a whole, those sponsorships amount to over $60 million per year and I assure you that replacement funds are not easy to find.

As a result of the partial or total loss of those sponsorships, the scope of our events will be reduced, and some of them may disappear. This will happen throughout Canada, in large cities as well as in smaller communities.

As I said earlier, Bill C-71 goes too far and should be amended. The amendments we recommend can be found in part 4 of the document we tabled this morning and rest on the following principles: the main purpose of sponsorship is to promote the event, activity, person or entity involved, and not the sponsor. Further, only events that are not aimed at a clientele of young people would be authorized to use tobacco industry sponsorships.

Within these two broad principles, reasonable restrictions would apply to these sponsorships. Allow me to mention some of them: the representation of a tobacco product or of a tobacco product package is prohibited; tobacco product trademarks may only occupy 10 per cent or less of the surface of any promotional material, nor take up more space than the space taken up by the name of the events; sponsorship advertisements may not appear in any publication with a readership made up of less than 85 per cent of adults, or be broadcast on radio or television when less than 85 per cent of the viewers are made up of adults; sponsorship advertisements cannot be put up within a 200-metre radius of a primary school or high school; sponsorship advertisements cannot use professional models of less than 25 years of age, and, finally the promotional material of sponsorship advertisements can only be posted outside during a relatively circumscribed period surrounding the event.

We believe these amendments are reasonable. Practically speaking, they impose reasonable restrictions both on sponsors and those who benefit from sponsorships. We are almost convinced that both sponsors and sponsored events would be able to live with them, and thus we would keep the millions of dollars in spinoffs in tourism, the economy and cultural and sports events.

As you no doubt know, according to a study done by Insert Canada Research which is appended to our brief, that Canadians do not want our events to be crippled or cancelled. They support us in quite a consistent way in wanting to see events continue to be sponsored by the tobacco industry.

The 36,266 signatures collected in a few days on a petition that was only circulated for a few hours, 18 to be precise, in Montreal and in the streets of Quebec bear witness to the support of the population for our events. It is an appeal to reason. Allow me to point out that 70 per cent of those people were non-smokers.

In closing, may I remind you that we are submitting these amendments to the Senate in the hope that you will consider them seriously and send Bill C-71 back to the House of Commons.

May I also add that in France, in spite of the Evin Act which has banned sponsorships and tobacco industry publicity totally since 1993, there has been a 13 per cent increase in smoking among young people, which shows that certain excessive measures can be totally ineffective.

We are at your disposal to answer questions. Thank you.

[English]

Dr. Alain Poirier, Host, Radio-Canada Television: I will first present our group. I will explain how sponsorship sells cigarettes and also make some comments about why we think no further concessions can be made. After that, Andrew Cash will show you how the tobacco industry targets young people through the sponsorship of rock and roll.

Artists for Tobacco-Free Sponsorship is an alliance of over 300 Canadian artists from all branches of the arts and from both English and French Canada. Our group includes such prominent Canadian performers, artists and writers as Anton Kuerti, the well known pianist; singer-songwriter Nancy White; writer and journalist June Callwood; Governor General award-winning author Charles Montpetit; and Marc-André Coallier, a well-known television animator.

Our group came together to counter the false impression the tobacco industry has tried to create that the arts community is united in support of its sponsorship. There are in fact many members of the arts community who are fundamentally opposed to tobacco sponsorship of the arts and arts events. Our group comprises those artists who have chosen to go public with their beliefs. There are many other artists and art organizations who, while they have not taken a public stance on this issue, do not support or accept tobacco sponsorship.

[Translation]

I will now switch to French for the core of my presentation. First, I want to tell you where my information and knowledge come from. I was the host of two television programs who received over a million dollars in sponsorships each year. That was more than 50 per cent of our budget. Of course, since they were TV programs, there was no tobacco sponsorship. Looking for sponsorships is not easy work, and our producer used to spend a large part of his time doing that. That is part of the myth that it is possible to find funds. You will recall that when tobacco products publicity on television was banned in 1972, we were then supposed to witness the apocalypse; people claimed that television stations and programs would disappear. How many television stations and programs do we have now? Their number has increased significantly. The same thing happened in France. When sponsorships were forbidden in 1992, the Fédération internationale du sport automobile, which organized the Grand Prix, stated before the French Senate that the Grand Prix would be withdrawn from that area in 1993. That threat was made when the French Senate was studying the Evin Bill a few weeks before the law was to come into effect. Once again, people cried that the sky was falling. And yet, the French Grand Prix took place in 1993, 1994, 1995 and 1996. We could also mention other countries.

It is easy to claim that the apocalypse is imminent, but after bills are passed, their actual impacts are not always equal to the claims. We have an excellent example with television in Canada.

My information is also derived from my other profession; I am a physician with a specialty in public health. After taking my medical degree, I spent another five years studying behaviour modification and various preventive strategies including legislation -- you have an important role to play here -- to modify behaviour.

Among other things, I took courses on sponsorship, because there is not much money available for health promotion. I studied with a prominent Montreal specialist, Mr. Vincent Fisher, who has published books on this topic. We learned a lot in his classes. I am coming now to the link between sponsorships and tobacco consumption. First of all, there is virtually no difference between publicity -- the means are different, but there is virtually no difference -- and sponsorships.

We showed you one or two of these ads, but there are a whole series of them; if you ask a child what they are about, in 80 per cent of cases, the child will answer that they are cigarette advertisements. That is the first answer they give most frequently. So when a child sees this type of ad and all of the others like it, he sees cigarette publicity.

So, young people and adults do not see the difference between cigarette advertisements and ads for events. One Formula I event is advertized in tiny letters as taking place on June 16, 1996. The ad for the event takes up less than 1 per cent of the whole surface of the ad. So, publicity and sponsorship are the same kind of process.

And what does modern publicity offer? Think of all the examples you know. There is no information on the product; the only result that is being sought is to create a favourable image. Publicity specialists say that the less useful the product, the more it depends on its image. One can see why a favourable image has to be created around a product such as tobacco, in order to influence consumption. That was to explain the image concept.

As concerns effectiveness, I always quote Vincent Fisher, the sponsorship specialist, who says that sponsorships are at least as effective as conventional publicity. Contrary to an ad which interrupts a good film, for instance, the sponsor reaches the public in a favourable environment. The fact that the consumer is at leisure, enjoying a pleasant activity makes him very receptive, and youngsters are even more susceptible, since marketing studies show that young people are three times more easily influenced by publicity than adults. The consumer is thus in a favourable environment, and very receptive.

Events are constantly mentioned in articles and news reports, so the media spinoffs of this visibility are calculated very carefully. Mr. Fisher explains that they are very important, more so than any publicity. Thus, the funds spent to reach 1,000 people are more effectively spent in sponsorship than through publicity. For $1 invested one obtains more media spin-offs than through direct publicity. So, it acts in a different way, but it is certainly just as effective.

The other advantage of sponsoring events, and you have a good example of that here, is that it creates a pool of grateful beneficiaries, which is quite significant. I do not need to say more about that.

Why do young people start to smoke, and what role does the sponsorship play specifically? The most important thing is to be aware of a danger. All young people know that tobacco is dangerous. But since the risk is likely to affect them when they are 35 or 40, they quickly forget about it. There is a problem that arises when smokers are questioned, specially young smokers; they say that if it is dangerous, why is it not forbidden, and why is it possible to advertise it? Even though they are aware of the risk, the risk is diminished and health-related concerns are lessened when a government does not act as responsibly as it should, for instance with regard to publicity and sponsorships.

But beyond sickness, death and statistics, that do not impress young people, emotion holds much greater sway. Emotion has a role to play in peer pressure, and is important; the whole notion of a favourable or unfavourable attitude toward a product comes into play here. Publicity and sponsorships and events create a positive attitude. We know that 20 years ago one could smoke anywhere, but now this is more circumscribed. But we also know that in countries where tobacco advertising is authorized, when adolescents are questioned they think that there are more smokers than there are in reality, if their answers are compared to the ones given in countries where there is no promotion. The social norm is thus distorted by publicity and sponsorships. That is another example where a link can be drawn between sponsorship, publicity, and promotion of a product and consumption. So, these do have an effect on knowledge and attitudes.

Tools have been devised and used to measure one's susceptibility to smoking uptake. If young people are asked whether they are smokers, the results may be biased, and we do not know what the effect is. There are ways of asking about susceptibility to smoking uptake, and that is a good predictor of whether young people will actually begin to smoke. When they are asked, those who have been exposed to campaigns and events promotions are twice as likely to take up smoking in the future. This can be measured ahead of time during adolescence, before they smoke; you can see that exposure doubles their risk of taking up smoking. That is not the only factor, and we do not claim that it is the only determining element; price is an important factor, but it is not affected by this particular bill. There are other factors, but I wanted to insist on the links between sponsorship and publicity.

But has this been measured? There are many studies which I have quoted that are somewhat peripheral to the phenomenon. Have we been able to measure whether or not a link exists? It is difficult, because there are always other measures possible in a society aside from forbidding sponsorships. There are more than 20 countries that have passed such measures, not Third World countries, but France, Germany, Australia, New Zealand; comparable developed countries. In some countries, where they could not isolate, analyze and measure the effect of sponsorship, an influence has nevertheless been noted; depending on the studies, some note an effect that reaches 20 per cent in some cases. But generally speaking, the most serious studies point to a decrease or a decline in smoking overall, from 5 to 10 per cent. That is not extraordinary, but it is a step forward, simply due to prohibiting sponsorships and publicity.

Finally, one can see that this has an effect on beliefs, attitudes and social norms; there is a certain effect, which is not absolute, but it is real.

[English]

Perhaps I should tell you exactly why we think no further concessions should be made. Your committee may be thinking of extending the phase-in period to longer than 18 months. If the time period were extended, the government would not be doing arts groups any favours. It would be allowing the dependency to continue. It would make it even harder for successive governments to ban sponsorships or even to hold to the restrictions of this bill.

In fact, last week, the person in charge of tobacco control at the World Health Organization reminded us that the theme last year for World No Tobacco Day was Sports and the Arts Without Tobacco. As he told us, everyone is looking at what is happening here in Canada in light of the many successes we have had in the past. It is certain that when he goes to different countries he will be awaiting your decision and that of the Canadian government in terms of what can be done in the tobacco industry. As I said, many countries already have such laws, and this bill is a good example. A longer phase-in period will allow the tobacco industry more time to exploit the potential loopholes in the legislation to their benefit. This is the main reason we think you should adopt the proposal as it is.

Andrew Cash will now show you how the tobacco industry targets young people through the sponsorship of rock and roll.

Mr. Andrew Cash, Rock Musician and Juno Award-winning Songwriter: Madam Chair, I have been a musician, songwriter, record producer and journalist in Canada for over a decade now. Over the last few years, I have also worked quite frequently in high schools running media literacy workshops.

I am here today because there are few institutions of meaning to which young people respond. It has been well documented over the last two decades that religion, education and, with all due respect, government and family life are institutions that we have seen fracture in our culture. One of the most consistent and solid institutions of meaning for young people is rock and roll.

Being a musician in rock and roll, I began to notice in late 1994 or early 1995 that the tobacco industry was starting to run sponsorship programs for rock and roll. I have always been aware of the jazz programs and racing car races, but I started to take very particular notice of the tobacco industry in rock and roll because of the clear connection. Rock and roll equals young people; we all know that. It has not changed in the last 25 years. There are few things that young people will listen to, respect and acknowledge as much as rock and roll. As sad a statement as some here may think that is, that is the case. All one needs to do is go to any high school for a few minutes to understand the full impact that rock and roll has on youth culture.

In early 1995, Export "A" started to run a program called the Export "A" Plugged New Music Series. Most of these bands were unheard of at the time. They offered these bands $500 a night to undercut the costs of their tours, so $500 a night for a tour of 15 cities. This is quite a big country, and, for rock and roll, it is actually a difficult country to tour. In a sense, it is fertile ground for sponsorship. Export "A" offered bands $500 a night to do club tours. In exchange for that, all the band needed to do was put up a poster, a large banner on the stage, which said Export "A" Plugged New Music Series. To be honest, you had to look closely to see "Export "A'" anywhere on the poster. It was done very well.

The key point of the sponsorship program for Export "A" had nothing to do with the on-site posters. The key point for Export "A" was the radio advertisement that now could be done: Export "A" New Music Series Presents blah blah blah at Banff or wherever. Then there was the print advertising. This was before the Supreme Court decision. Suddenly we saw advertising in the print media for this Export "A" Plugged New Music Series.

When tobacco manufacturers are targeting young people in night clubs, one must remember that, of course, you can only be 19 to get into a club. However, in the shifting sands of rock and roll right now, there is a large movement to do what is called all-ages shows. Many bands will do two shows in one day. They will do an all-ages show in the early evening, and then they will do a licensed show later on. However, the advertising is still the same. On the radio, it will say, "Export "A" New Music Series presents such and such a band appearing here, all ages show at 7, licensed show at 9." It is still the same show. The posters and the banners do stay up at the show. They are there for the all-ages event as well. This is a real way in which a sponsorship program directly focuses on young people.

In the first year of the Export "A" Plugged New Music Series program, $400,000 was funnelled into the program. The following year, the budget expanded to $1 million, which included a very large tour bus which had the Export "A" Plugged New Music Series logo emblazoned in quite a dramatic style. The program increasingly drew more and more into its net. Fewer and fewer people are willing to speak out on the issue as they take more and more of the money. We say that the sponsorship itself is as addictive as the product.

I have known some rocky roads. There is no doubt that it is a difficult grind for many musicians, and no doubt it is the same for dancers and playwrights. It is a rough go. However, in rock and roll, prior to the tobacco sponsorship, things did happen. There were bands, and they did tours. People found out about them. It was a thriving community. In some ways, sponsorship subverts the process in rock and roll, because suddenly bands no longer know how they could tour without Export "A" money because they have become used to it. That has clearly been the case because we see many bands which could never have demanded $500 a night to play their shows, and suddenly they are getting $500 a night. I hear right now that the Export "A" program is not actually running. I am not sure that is confirmed. However, now you have bands used to the money no longer getting the money. It is an inflated situation.

I shall leave plenty of time for questions, but I should also state that the Artists for Tobacco-Free Sponsorship have never advanced the idea that sponsorship works like this: You go to the du Maurier jazz festival, then you come home and buy cigarettes. That is, quite frankly, an outrageous idea that no one from our side has ever put forward. Sponsorship works in its selling of cigarettes in a much larger way, creating a climate of acceptance. In rock and roll, there is a direct relationship. You have young people at a very vulnerable time in their lives, an age when most people start smoking, by the way. Advertisers are just drooling over themselves to capture sovereignly the imaginations of young people. That is why advertisers are mediating almost every event in a young person's life. That is part of the culture in which we live. However, we are dealing with a product that is well documented as a killer.

Senator Doyle: Mr. Beck, you talked a bit about your venue, which I understand is Ontario Place. I remember when it was built. They dug the foundations for the Dominion Centre, dumped them in the lake, and created an amusement park. One of the first attractions at the park was the weekly jazz and symphony concerts held outdoors on the hill in a band shell. At what time did the cigarette companies enter the scene as sponsors? Were they there in the beginning?

Mr. Beck: The cigarette companies entered approximately 10 years ago. In the early days, almost all the funding came from government. The government now gives less than 10 per cent of the funding to comparable events. These events get a very small amount of money from government. We are almost entirely self-reliant. In this approximately $60 million a year business, we get $4 million from the government. We get less from the government now than we get from the cigarette companies, to be frank.

Senator Doyle: Would it not be true that these are far more expensive events that are now featured at Ontario Place?

Mr. Beck: They are far more expensive events. They are very big and draw a tremendous number of people. We do far better as an organization. We contribute much more to the economy. We get a tremendous number of tourists that come up to see the fireworks, for example. Between Ontario Place and the fireworks, we have about 4 million visitors a year. Roughly 25 per cent of them are tourists who come in from out of the country and bring their dollars to spend in Canada.

Senator Doyle: It is therefore not an entirely cultural consideration.

Mr. Beck: A number of years ago, when government funds were cut, for example, we had to cancel the symphony. The symphony, unfortunately, does not play there. One of the banks used to help us sponsor the symphony. We lost that sponsorship, too, but I have been working in the last year or two to try to get corporate sponsorship to bring the symphony back, but the government funds are not there as they once were to do those things.

Senator Doyle: Is it either the government or tobacco companies?

Mr. Beck: No. We do have other sponsors. I get about $3 million from other sponsors. We work very hard. I have not been successful in even replacing the cuts to government funds. In terms of the new funds , however, we have a pretty good record of getting corporate sponsors and we work very hard at it. All sponsorships together are $8 million, and about $5 million of that would be from the tobacco companies. The other $3 million comes from about 50 different organizations.

Senator Doyle: You said that the rules laid down in the bill we are dealing with are extreme and unreasonable. What purpose do you think is behind the sponsorship by the tobacco companies of the various concerts and other grand events that they are so willing to underwrite?

Mr. Beck: Name recognition and product recognition. Whether or not anyone else takes up smoking from here on, there are still about 7 million Canadians who smoke. I am sure this is a battle for brand preference. When an airline company sponsors Cirque du Soleil at Ontario Place, I do not believe anyone goes out that day and buys an airline ticket. However, when they do buy an airline ticket, I assume that Air Canada hopes they will buy their ticket.

Senator Doyle: There is nothing on the poster in front of you to suggest that that product is any better than any other tobacco product.

Mr. Beck: That is correct. All it does is put the name of the event on there. There is no product advertising. There has never been product advertising. We have never been allowed to do anything that promotes products. We would not want to do that, frankly. We have only been able to promote the event. In that case, it is a title event. They own the event. It is not my event. We host the event, just as we host the Indy and other events. It is their event. They could move it to Buffalo tomorrow if they wished.

Senator Doyle: Would you agree with Mr. Poirier and Mr. Cash that sponsorship also buys respectability?

Mr. Beck: It probably does buy some respectability. It creates some sense of goodwill on the sponsor's behalf. That happens with many sponsorships.

Senator Doyle: Would that kind of goodwill translate into product acceptance?

Mr. Beck: I am not sure that link is there. I have asked the minister to provide us with information in that regard, and we have tried to look carefully at ourselves as an organization to see if we can find a link between product acceptance, product use and that advertising. There are many factors that contribute to a young person deciding to take up smoking, for example. Clearly, this could play some part in it, but it would be a very small part.

When I was on an open-line program, I remember a caller who said, "Listen, if anybody should be a tobacco user, it should be me. Since I have been five years of age, I have been collecting Player's racing memorabilia." He felt he had one of the best private collections in the country. He started collecting it at about five or six years of age. His parents were racing fans. When he got to be 14, he tried smoking, as do many people. He did not stay a smoker and to this day he is still a Player's racing fan. He has his collection but he did not become a smoker. Obviously, that is an individual case.

Advertising is probably a factor in smoking, but it is probably one of the least important factors in terms of young people taking up smoking.

Senator Doyle: How do you react to the point that Mr. Cash made about young musicians becoming addicted to the sponsorship?

Mr. Beck: I do not know. Much entertainment business nowadays is sponsored by other companies. In our case, we have a big amphitheatre built by Molson Breweries, the Molson amphitheatre. Molson Breweries sponsors a tremendous number of touring entertainers in this country. The fact is corporations are funding many of these activities.

Sponsorship does have an impact on economics, and, as a whole, we have become a much stronger country as a result. Our arts have become stronger. Certainly without the support that we have had from Player's in auto racing, we would not have a Jacques Villeneuve winning all the Formula 1 races. Whether we like it or not, or whether we are totally supportive of tobacco sponsorships, they have done much good work.

The International Fireworks Exhibition held at Ontario Place is world-recognized. We have people coming up to Canada and spending good money to see that event. We have worked very hard and we have built it into a major event. We will do everything we can to maintain that event, but I am afraid the minute this bill comes into effect, we will be on a downhill slide. We may be able to save it, but I do not think we will able to sustain the kind of growth and momentum that has made it such a big success.

Senator Doyle: Are you suggesting that Molson Breweries is responsible for 40,000 Canadian deaths every year?

Mr. Beck: No, I am not. However, there are problems associated with drinking, too. We work with Molson Breweries on programs such as the Take Care driving program. We have always tried to have responsible programs to encourage responsible use of alcohol.

The Chair: I want to ask a brief supplementary question on something Senator Doyle asked, and that is with respect to the year. You said you thought it was about 10 years ago that the tobacco interests came in. Were you aware at the time that that was exactly the time that they had been basically banned from all other kinds of advertising?

Mr. Beck: I am not sure it was a ban. I am of the opinion that the government of the day had some wisdom in saying, "If indeed there is to be some sort of tobacco advertising at all, then let us at least funnel it through arts and event organizations where it will do some good." Indeed, many of us have taken advantage of that, made some good out of it and built some incredible events across this country. The 370 groups that I, amongst others, represent have done a lot of good with those dollars. I do not think that the government of the day was thinking when they did that. I assume they did it with some purpose. I was not there at that time. My staff looked around for opportunities to form an alliance and to put on some event and promote some event with a tobacco company.

Senator Kenny: I have a lot of sympathy with Mr. Beck and his group. I think that you are the meat in the sandwich. I think that governments have systematically cut back on funding for arts and culture. I think that tobacco companies have craftily moved in and addicted you to their funding. It makes me angry to see you in a position of acting as a front man for Benson & Hedges. I think that is an unfortunate position for you to be in and I do not envy you at all.

Do you really believe, Mr. Beck -- and I am tilling some of the same ground as Senator Doyle -- that tobacco companies are so altruistic that they are supporting you because they love arts or sports or the Symphony of Fire, or that they are doing it to sell a product that kills people?

Mr. Beck: I certainly recognize that they receive benefits from their sponsorship. They get name recognition from it. The difference between a sponsorship and a charitable gift is that in a sponsorship, the sponsor usually expects some kind of name recognition. That is what it is all about.

Senator Kenny: Yes, something in return.

Mr. Beck: Absolutely. There is usually some kind of name recognition, advertising value, or good will by being associated with your organization, et cetera. Clearly, I do not think we have ever denied that there is a benefit and a name recognition for tobacco company products.

Senator Kenny: Has it ever occurred to you that the tobacco companies have systematically organized groups like yours right across this country for just this occasion? They saw it coming. They knew that they would need support. They knew that instead of having you folks up here -- because you are the good guys -- if we had the CEOs of the tobacco companies up here, we would not do a half hour session. We would spend the whole day, and we would beat them up. Instead, you are here. You are putting on an event that thousands of Torontonians like. Other events will go on in Montreal, Toronto or Vancouver that everyone thinks are terrific. These people have co-opted you to come up here on their behalf, and they have done it in a systematic way. They planned it ahead of time so that you would come here on their behalf to put pressure on us as politicians not to pass legislation to protect the lives and the health of Canadians.

Mr. Beck: That is simply not so. First, I believe that the genesis of a lot of this was federal legislation which allowed this opportunity. It was not just cigarette companies being aware that there was an opportunity here. Lots of us saw an opportunity to work in and develop and promote events.

When it comes specifically to why and how we are here, when the government came down with the blueprint on tobacco smoking back in Diane Marleau's day, I wrote immediately asking for a meeting because we were one of the biggest events to be affected. I was not granted a meeting. A new minister was then sworn in. I wrote to the new minister asking for a meeting. I wrote and called for months. There was no dialogue at all with us. I phoned around to other organizations asking, "Are you being stonewalled?"

I used to work for the federal government. In my day, the federal government was consultative. They would have brought in groups and organizations and tried to work something out for both parties. We were absolutely stonewalled. I got on the phone saying that we must put together some kind of group. If they will not meet with us as individuals, let us see if we can get together as a group and maybe they will listen to us then. That was the genesis of it. It was not initiated by the tobacco companies. We did turn to the tobacco companies and asked for help because they are our partners, but the tobacco companies did not come to us and say, "Why do you not get there?" No one from the tobacco companies called and asked me to do that.

Senator Kenny: They did not have to do that. They knew you would come anyway.

Mr. Beck: Mr. Dingwall probably gave me as much incentive as anyone because I was totally stonewalled in terms of a meeting. I think it is unconscionable for an organization this size not to consult with groups given the impact that this is having.

Senator Kenny: I am not trying to let governments off the hook. If it was a perfect world and if I was king, I would have a transition program. I would have government funding. I would tax the tobacco companies another buck, not let them do any promotions, and give you the money to carry on for two or three years so that you could find other sponsors.

Let me ask you for a minute to be a senator. Come on over and sit on this side of the table with us. On the one hand, you have given us a case that you are putting on terrific events everyone likes. Canadians just love the Jazz Festival and the Festival of Fire. They like all of these things. They cost $60 million. You gave us statistics earlier about what they bring into the economy. Put that on this side. Remember, you are sitting over here on my side of the table. Now, put on the other side the $3 billion in direct health costs and another $7 billion in indirect costs. Add on top of that 40,000 Canadians dying each year because of the product.

If you were sitting on our side of the table, how would you handle that balance?

Mr. Beck: I would do two things. First, we have provided to you a set of what we believe would be reasonable restrictions dealing with some of the excesses and extremes of promotion. It still regulates promotion. We have always been regulated. It would tighten the regulations a lot from what they are currently, but it would not be Draconian and virtually stop sponsorship. It would allow some sponsorship to continue. That would not involve a cost to the government.

Second, I would work with either the government to take some of its funds or the government to mandate the tobacco companies to take some of their funds and put them into more education programs. Earlier, there were discussions that prohibition-style things are over with. You have to be careful that some of these things are not doing more right now. In certain ways, I think that Mr. Dingwall has heightened the awareness of this as a forbidden thing. He may be contributing to the problem right now by the kind of attention he has brought to it.

These arguments are complex, but if you work with young people and launch some programs, you could have very effective programs like the alcohol companies do.I think we could have programs that work at reducing the number of new people who take up smoking.

I am a non-smoker. I tried. My daughters are non-smokers. My mother will turn 80 in a couple days and she smoked all her life. She has tried to stop a few times and has been able to stop. The doctor tells her all the time to give up smoking. I have given up trying to tell her. I am not sure if she smokes Benson & Hedges or not.

Life is like that. A lot of people will not stop, but perhaps we can stop young people from smoking. Good programs can be developed, and the government can help steer dollars toward that if it is done well.

Senator Kenny: Thank you, Mr. Beck. You were a very helpful witness.

Senator Nolin: Maybe Senator Kenny could tell us how much money the government is saving because those 40,000 Canadians are dying every year.

Senator Kenny: Is that a case you would like to make?

Senator Nolin: You should make that case too.

[Translation]

Senator Nolin: Mr. Poirier, there is a small debate going on here in Ottawa about your membership. You claim to have 300 members; do your 300 members all agree with what you have told us this morning?

Mr. Poirier: I do not know the exact number, or the names of all 300 members. However, I can tell you that some received calls from the other party to pressure them and to find out whether they really were members. I know people who said no at that time because they saw that there was a problem, and yet they agreed with the ideas we put forward. But when they had to say: yes, I am acting in such and such a play, they preferred to say no. I received a call myself; they were all called, I do not know by whom, and they were asked whether they really were members. They were asked whether they agreed with what we were saying. So there have been some very subtle pressures exerted, just as there were many other subtle things in this whole debate, to know whether the 300 members -- and I have not committed the list to memory -- were active. Those I know are active. I participated in other activities in the past, so I cannot tell you exactly.

I asked some friends personally and they said no, they were there in 87, 88. Since then, there have been some extraordinary investments and they became members, as we said earlier. They joined for all kinds of reasons, to take part in plays and various other activities. They are always in the media sportlight aside from promoting their products, if they are singers -- those whom I am thinking of -- for all kinds of jazz events. They are always dealing with the media, they are always close to spokespeople for events that are well known in the media. It is a small world and it becomes quite difficult to speak against your neighbour. This debate is not an easy one. As Senator Kenny said, everyone wants these events to survive, everybody is sympathetic to that cause. Many artists are as well and need to be told certain things they won't hear elsewhere.

Senator Nolin: You said in your testimony, and Mr. Cash said the same thing, that there was a well-documented relationship between sponsorships and an increase in smoking. What studies are you referring to, since we have been hearing since we began studying this bill that there is only one study -- and we will be discussing it this afternoon with an expert witness -- that establishes a link between sponsorship and increased smoking and that if all of the promotional means are ranked, sponsorship is the weakest, the least important. You seem to have other information. It is easy to say that something is well-documented. But in what way? What studies can you point to?

Mr. Poirier: I quoted some earlier. It is difficult to isolate one event.

Senator Nolin: Experts can do that, and psychologists also. We will be hearing them. Perhaps you are not the best witnesses to give us that information. Basically, you are saying that there are events that are unfortunately sponsored by tobacco companies, and others, fortunately, that are sponsored by beer companies. Mr. Cash did not tell us that the Laurentide rock concerts were sponsored by the Molson company. That is another debate. There are only 16,000 Canadians a year who die from alcohol consumption as opposed to 40,000 from tobacco consumption. That is not the issue.

How many Canadians will lose their jobs if tobacco companies stop sponsoring your events? We will ask others whether there is a psychological link between smoking uptake and the fact of seeing Benson & Hedges advertise fireworks in Montreal and Toronto.

Mr. Poirier: Studies look at things from different angles, and it is not easy to establish a link. Those who have managed to isolate the effect of publicity say that publicity and sponsorships are interchangeable. It is the same mechanism that creates an image. If you see an ad for MacDonald's or anyone else, it does not explain how a BigMac is made. It creates a favourable image about a product. All publicity functions that way. So do sponsorships. The studies we have come from countries that have prohibited publicity and sponsorship. Four succeeded where others could not isolate the effects of publicity and sponsorship. The results vary between 4 and 10 per cent, and some reach 20 per cent. The best study that reviewed all of the countries where these measures were introduced is the Ash report, an English study that reviewed results in different countries.

Senator Nolin: Can you provide us with a copy of these documents?

Mr. Poirier: Of course, it will be a pleasure to send one to you.

Senator Nolin: Studies show that in countries where all tobacco publicity and promotion was prohibited in the best case consumption remained stable, and in the worst case, in Norway, unfortunately tobacco consumption increased by up to 45 per cent. It was at 30 per cent before this measure was taken. I'd like to see your studies.

Mr. Poirier: There are other factors involved in tobacco consumption. If sponsorship is forbidden as it was two years ago, publicity rebounds. Among young people in Quebec consumption was at 19 per cent in 1991. When smuggling was finally brought to a halt -- we know who was behind it, encouraging it -- the figure had reached 29 per cent among young people. I am referring to Quebec. Those are the figures I am familiar with. A study carried out last spring which has not been published yet shows that the 19 per cent figure from six years ago has doubled to reach 38 per cent consumption among young people of less than 18 years of age.

There is of course another factor, which is price, and it played an important role. However, when we had a general policy to restrict publicity and increase prices gradually, we noted in countries where such measures were introduced that there was a decrease in consumption. That is an example at the level of countries, of course. There are so many factors that come into play that anyone can say no, there is no impact, in fact it goes the other way.

The more a company invests in publicity the greater its market share among young people. In all countries where that was measured, the result was the same. When Marlboro launched its cowboys and independence campaign, it had no market share.

Senator Nolin: We want to do serious work. We want our opinions to be based on fact. If you make statements, you have the right to express an opinion, but if you claim that your opinion is supported by studies, you have to give us a copy of those studies.

Mr. Poirier: It will be a pleasure to provide them.

Senator Nolin: You talked about smoking in Quebec. I would like to see your figures, because the statistics we have from Statistics Canada show that among young people, there has been almost no change, including the period when there was no publicity.

It is easy to give an opinion. We need facts, opinions based on serious studies.

Mr. Poirier: The Quebec Department of Health carried out a study last year showing that the consumption rate had reached 38 per cent among young people in Quebec. In 1991, the same question was asked and the result was 19 per cent. Those are not my figures.

Senator Nolin: Provide us with documents. We asked the Quebec government, like all other provincial governments, to appear before the committee to enlighten us in our debate. No one has yet taken us up on our invitation. It will be a pleasure for us to study your documents but if your opinion is based on anything but facts, I am sorry, but that is not how we will be working. We really want to work using scientific data, valid analyses. That is why we asked experts to come and testify.

Mr. Poirier: In the documents I gave you you have a copy of the article I wrote where I quote some of the studies I referred to, which you have not heard about, obviously, where the four countries that measured the effect of these prohibitions noted a reduction of 4 to 9 per cent. I will be happy to send you the source of that data. I quote the study. I will send you the study.

Senator Nolin: I have one last question. Have you read the amendment proposed by these gentlemen?

Mr. Poirier: The amendments, the voluntary agreements, the publicity codes, the programs to reduce illegal sales, all of that is smoke and mirrors. The voluntary agreements, the recommendations, all belong to the same tobacco industry strategy: Delay the passage of the bill, and once it is passed, go to court. That is the first strategy with regard to your role.

The second is to attack the credibility of the messengers and to call them ayatollahs, or this, that, and the other thing; those are the two universal strategies. The third one is: never get involved in the debate directly, but send spokespeople instead. As we said earlier, they are never actually there.

Senator Nolin: The answer to my question is no. You have not read it.

Mr. Poirier: Yes, I did read it, and its purpose is to delay through any amendment; the bill will be brought back, there will be elections, all the better if there are amendments and if it is not passed, they will return with a bill in 10 years, bravo, we will have gained 10 years in Canada. That is the strategy behind these amendments.

Senator Nolin: It is not the amendment we have before us. It proposes an amendment to clause 24.1. That is the clause that deals with sponsorship promotion. I will tell you frankly, during the second round of questions I am going to put questions to this gentleman to find out what the difference is between his amendment and the bill because it seems just as restrictive. I will ask him later. I want to know whether there is any way of arriving at an agreement on sponsorship.

Mr. Poirier: I did not receive their amendment. What I am saying is that this is the classic strategy, which is to propose all kinds of amendments constantly. Can you read clause 24.1 to me?

Senator Nolin: In my opinion, a compromise could be found that would suit everyone.

[English]

Senator Kenny: Madam Chair, I was trying to do a cross-benefit at the end of my questions and Senator Nolin jumped in. I want to clarify his position. Is he really making the case of cigarette companies that smoking is a good thing because it kills people earlier and reduces health costs?

Senator Nolin: No, no.

Senator Kenny: Let us be clear. What is your position?

Senator Nolin: You are talking about 40,000 Canadians dying each year. I am just asking how much money we save.

Senator Kenny: Because they die?

Senator Nolin: Yes. That is probably documented somewhere.

The Chair: With the greatest of respect, senators, we should pursue this at another place and time. Let us concentrate on our witnesses at this time.

Senator Nolin: The minister will tell us that when he appears at the end of our hearings.

[Translation]

Senator Beaudoin: You are fighting, quite rightly so, for freedom of expression, and I agree with you entirely. There is a basic distinction to be made, when you talk about freedom of expression, between absolute prohibition and relative prohibition. It is one thing to say that you cannot do something, and it is another to say that freedom of expression is being restricted somewhat. I would like you to provide us with some practical examples.

For instance, we are saying: Yes, you cannot use large or very visible print, but you can still advertise a product. That distinction is important to me on the legal level because if the prohibition is absolute, certain legal principles will apply. If the prohibition is relative, or if you are imposing a restriction, the question has to be asked. This is a societal debate. Is this acceptable in a free and democratic country such as Canada? Does it run counter to freedom of expression, does it restrict freedom of expression, but is it still acceptable? Concerning festivals or artistic events, I would like to hear some examples from you where you feel restrictions are unacceptable, unreasonable, et cetera. Can you submit one or two cases? I suppose you can, since you have proposed amendments.

Mr. Létourneau: Since I am not a lawyer but an events promoter, I would invite our lawyer to reply. There are certain restrictions contained in clause 24, subsections 1, 2, 3, 4, paragraphs (a), (b), (c) and (d), et cetera. I will use clause 33 as an example. Clause 33 states that I cannot officially, as the director general of an event sponsored by a Canadian industry, refer to the Festival d'été de Québec du Maurier without exposing myself to a prison sentence. That is unacceptable. Du Maurier will also be forbidden from presenting the cheque publicly to the Festival d'été in the presence of journalists. That is unacceptable and impinges upon corporate and individual freedom of expression.

Senator Beaudoin: If the name appears somewhere in any case?

Mr. Létourneau: I will go back to what Mr. Andrew Cash was saying earlier. Mr. Cash gave an overview of the major exaggerations on tobacco products sponsorships. Such exaggerations are made about many other sponsorships, but we are talking about tobacco this morning.

The amendments we are proposing will for the most part solve the problems Mr. Andrew Cash highlighted in the majority of cases he quoted this morning. This bill is divided into four parts: the first one concerns the product, the second the packaging, the third the accessibility of the product, and the fourth, sponsorship and promotion.

We do not intend to intervene concerning the first three parts. We are not specialists. Yesterday you met tobacco industry representatives, and perhaps you will see them again next week, I do not know.

In clause 24, a clause that concerns us, all the effective restrictions have been included that could have a negative impact on the value of a sponsorship, without reducing it to nothing.

Senator Beaudoin: You are ready to accept certain restrictions for reasons acceptable in a society.

Mr. Létourneau: Of course, we agree with the public health objective, and we agree that young people have to be protected. Each one of us, the different events I mean, have to come to terms with this moral issue in one way or another.

I am the director general of a non-profit organization where 17 members of the board of directors support me in the work that I do to obtain funds from private businesses, and they are extremely sensitive to this public health issue. At the Festival d'été, our young clients, children, will not find the Festival d'été de Québec du Maurier logo on T-Shirts, stages, banners, or any other place like that. That is an important effort that shows that we are sensitive to that objective involving public health in Canada. Du Maurier has the main stage, it is the title sponsor of the event, but it sponsors it with relative discretion. Of course, it reaches its commercial objectives, as Mr. Beck explained earlier. Perhaps there have been abuses in putting up Mediacom billboards next to a school door. We would propose that that no longer be possible. Basically, we are asking the government to police the voluntary code of an industry denounced by Mr. Poirier. If we need policing services, let's assign them to the right people, in a reasonable way.

Senator Beaudoin: Mr. Poirier, do you have something to say on this?

Mr. Poirier: You have to have followed this file for a long time to see all the little holes in the dike and the loopholes, such as sponsorship itself, which has been forbidden for years. When this debate took place several years ago with the government, the tobacco industry was asked whether it would not create companies that would not be called du Maurier, or show cigarette packages, and whether it did not think that would be one way of going about things. They answered: No, no, we will not do that. We have the quote, we can provide them to Senator Nolin.

Senator Nolin: There are no quotes about that in your text.

Mr. Poirier: They answered: we would never do that, create front companies, that would be immoral. Does the public know that for du Maurier tennis events, or Player's events, cigarette packages are in no way involved, but non-profit organizations handle sponsorships? There is an example. In all the countries we mentioned, in France, for instance, do you know that cigarette advertisements are forbidden? Now you look at advertisements and you cannot see the difference. Marlboro advertises a lighter. You have to look very closely to see that they are advertising a lighter or a pack of matches. If you give them an inch, they will take a mile. They will never leave the industry with the opening they are being given. They will never disappear, they would lose their spokes-people. When the issue was smuggling, would they have left for the United States? Oh no, this was their issue, cigarettes produced jobs, they have this many employees. They always say that they are going to withdraw and that the sky will fall. They cannot leave and stop sponsoring. On the contrary, if you leave a crack in the door, they will inject even more money in order to create more allies and be able to better justify what they do, which is sell tobacco. As far as I am concerned, tobacco industry sponsorships should be completely forbidden and the money they provide could easily enough be replaced by a fund as someone suggested. We could have done that. That is not what is being proposed, for the moment we have decided to try and control freedom of expression. I know that they will find other means of getting their advertising out to reach young people.

Senator Beaudoin: Of course, we could have another bill before us. But we have a role to play as parliamentarians and legislators. We take a bill, we accept it, amend it, or reject it, and we study it in any event. Many points of view have been expressed concerning Bill C-71. Opinions are expressed on the bill that is before the Senate. It is interesting to wonder whether we could do something else, but that is not what is before us. I asked the question, your answer enlightened me somewhat, but the task is not an easy one.

[English]

The Chair: I have one question specifically to do with the recommendations that you made for change. I find it somewhat difficult to take you seriously when you recommend, for example, that no sponsorship promotions can be produced depicting a professional model under 25 years of age.

If I look at the sports world, I cannot think of a single one that I would want to use in a promotional sponsorship who is not 25 or more. Elvis Stojko turned 25 last week. Several of our athletes have yet to reach 25 years of age. Where did you come up with this age?

[Translation]

Mr. Létourneau: I do not know if you saw that on page 2 of the amendments, they do not talk about publicity aimed at those of less than 25 years of age, but about models or professional actors of less than 25. Why do not you think that this is a serious measure? We want to avoid any confusion.

[English]

The Chair: If I were an advertiser and I wanted to hire someone to promote my product, I would want a name brand person. Most people have to be at least 25 to have acquired that name recognition.

[Translation]

Mr. Létourneau: There are very young artists who are well known at 19 or 20 years of age. Johnny Lang is a rising star, he is 14 and is all the rage in the United States, so, theorically, he could be a spokesperson for this. It says that public spokespersons who are used in advertising should be more than 25.

[English]

The Chair: Are you saying it is perfectly okay for sports figures or rock and roll musicians or anyone else with any prominence in the community to go about promoting smoking cigarettes?

Mr. Beck: Only if they want to. All the way through this we are concerned that there be a choice. We are certainly not demanding that people do that, but if the person were to chose to, yes.

Mr. Poirier: Remember that the Marlboro man, when he was first introduced, looked 40 years old. He was constructed to give an image of autonomy and of someone who could take risks and live by himself.

[Translation]

Everything was fine in his life. He was at least 40 or more. Of course, we are never told that he died of cancer at the end of his life, and that finally he regretted having done that his whole life. The Marlboro man was not a well-known figure, not a skater. He was an image created for the product.

I just came back from a country called Albania which we hear about for other reasons. The Marlboro man is a new one now. He has the same look, is about the same age, 40 to 45, and is on billboards everywhere. This strategy had been conceived to get about 1 per cent of the youth market share, and in a few years they had got most of it. It is the most important company. So there is an example of a voluntary code that does not work, because what they want to create are images. You can fill young people's heads with images, whether you are 26 or 28, it does not matter.

[English]

Mr. Cash: I have one response to this whole idea of choice. What we also have to entertain is the idea that with an onslaught of this kind of sponsorship, the choices become narrower for artists and arts groups, sports groups and theatre groups that do not want to take this kind of sponsorship. We see this in rock and roll with the breweries.

In the early 1980s, there was much activity with the sponsorship of beer companies and, as an artist, if you did not want to get involved in that kind of thing, you had the choice. What sponsorship does by its very nature is eliminate that choice. What we have now in rock and roll and other areas of the entertainment industry is a situation where the breweries are omnipresent. You cannot play a rock and roll show in this country without some level of beer sponsorship. That is a real concern when we start talking about choice.

The Chair: I want to thank all four of you for providing us with valuable information this morning.

I would invite our next group of witnesses to come to the talk.

Please proceed.

Mr. Michael Merrall, Managing Director, Vice-President, Event Marketing, International Management Group: Madam Chair, members of the committee, thank you for the opportunity to appear before you this morning in these important public hearings.

My name is Michael Merrall, and I am the managing director and vice-president of event marketing at IMG Canada. I would like to talk to the sponsorship market in Canada and help clarify the ongoing public debate concerning the effects of a possible withdrawal of tobacco company sponsorship from major events and sports and the arts.

Let me begin by indicating that I agree with the health objectives of Bill C-71, particularly as they relate to youth smoking. I am here today, however, to address the consequences for Canadian event promotions of an effective ban on tobacco company sponsorships. As I read Bill C-71, it is clear that these sponsorships will most certainly be jeopardized and hundreds of arts and sports events will be negatively affected. Many will be cancelled all together.

In order to put my remarks in context, I would like to tell you about a little bit about my company. IMG is the world's largest and most successful sponsorship company. I am part of an organization that employs over 2,200 people in 64 offices in 29 countries around the world. We are experts in the business of athlete representation, sports television and event marketing. We own, manage, televise, represent the commercial sponsorship rights or consult to over 2,000 events each year, an average of six per day worldwide. Our office in Toronto has been operating for 22 years. We have a staff of 25. We are by far the largest independent sponsorship company in Canada.

Our annual sales are measured in the tens of millions of dollars here in Canada. We professionally manage the sponsorship sales campaigns for some of Canada's leading events, including Chrysler "Stars on Ice", the Toyota Canadian Pro Figure Skating Championships, the Bell Canadian Open, the Export "A" Skins Game and the du Maurier seniors golf event. We are also a television consultant to many of Canada's leading organizations, including Tennis Canada, the Royal Canadian Golf Association and the Toronto Maple Leafs.

In our opinion, it is simply not realistic to believe that most major events will be able to secure replacement funding from industry categories other than tobacco companies if Bill C-71 is passed in its current form and tobacco companies sponsorships are effectively banned. This will lead to the cancellation of the vast majority of events in Canada that rely on tobacco company support.

This is not idle speculation. This is the qualified opinion of a company that is in the market 365 days of the year. Allow me to quote some statistics that I believe will help illustrate my point.

IMG Canada has assembled a database of over 1,000 companies we believe represent the total universe of event sponsors in Canada. In the past five years, we have conducted business with 200 of those companies and formed relationships with literally hundreds of others. We have 10 executives and a sales organization with full-time staff out in the market every day pursuing sponsorship relationships.

The single largest expenditure that any single non-tobacco company has made with an IMG owned or represented property in the past 22 years is $550,000. I contrast this figure with the Export "A" Skins Game for which RJR Macdonald budgets over $2.5 million.

To the best of my knowledge, most of the major events that face cancellation have operating budgets well in excess of $1 million and many operate with far greater budgets.

The obvious question is why? Why can tobacco companies outspend virtually any other company ten to one? The answer is that corporate sponsorship of events is not philanthropy. Companies look for appropriate recognition for the level of funding they provide.

Tobacco companies have been highly restricted in the ways they can advertise and promote their brands. We all know that. In virtually every other industry where these restrictions do not exist, there are numerous other advertising and promotion options. Consequently, return on investment is compared against any and all of these traditional means of advertising.

For companies outside the tobacco industry, given prevailing market conditions, major event sponsorships do not provide adequate recognition for investments of $1 million and more compared to the recognition that can be accrued from these other forms of advertising and promotion.

When looking at the $60 million in event annual expenditures made by the tobacco industry, you must remember a generally accepted rule of thumb in the Canadian sponsorship industry. For every $1 a company spends on purchasing a sponsorship property or aligning themselves with an event, they must spend an additional $3 leveraging the event. By that, I mean the companies must reinforce their association with the event through sales promotions, public relations, ancillary advertizing campaigns, corporate hospitality programs, employee incentives and the like if their business objectives are to be met. If they choose not to spend these additional funds, they run the real risk that their investment will have been wasted. Stepping back, it means that a $2 million property buy actually means a company should be budgeting in the neighbourhood of $6 million. A $3 million buy obviously requires a $9 million budget. It is not hard to see, at least from my perspective as an individual working in this industry every day, that these numbers are unrealistic when you take a look at the relative size of marketing budgets here in Canada.

I remind you again that the largest sponsorship we have ever secured by a non-tobacco company in 22 years is $550,000. In comparison, we have heard that Benson & Hedges provides $5 million per year to Ontario Place for the Symphony of Fire events, and du Maurier provides $10 million per year for Tennis Canada to run the two national open championships.

By IMG standards, Canada is a small market. Corporations cannot typically sell enough products here to justify $1 million plus in expenditures. The situation is far different in the United States and most European countries where the consumer markets are many times the size of ours. In those countries, companies in any number of industry categories have the resources and the budgets to spend at the same level as tobacco companies, and they do.

Unfortunately, Canadian event promoters compete in a world market for world-class talent, whether it be golfers, tennis players, race car drivers, musicians, dancers, even comedians. As such, the requirements for fees and prize money are no different than they are in the U.S., a market 10 times our size. This makes world-class events astoundingly expensive, and the sponsorship expenditures it takes to support them are beyond the means of almost every company in Canada, outside of the tobacco companies.

Although the Canadian market is smaller in comparison to the U.S., there are many companies here with the financial resources to invest millions of dollars in sponsorship if they were so inclined. As we all know, for example, the six major chartered banks all reported 1996 profits in excess of $1 billion. I would stress, however, that these banks and indeed most major companies are savvy marketers. They subject event sponsorship proposals to the same rigorous criteria that they apply to all possible marketing options at their disposal. Again, their decisions are based on garnering appropriate recognition, and our experience is that major event sponsorships with budgets of $1 million plus are simply not supported.

I can tell you that my company has invested many hundreds of hours in the past 16 months on behalf of the Royal Canadian Golf Association -- the RCGA -- seeking sponsorship for the Canadian Senior Open, a highly prestigious new event on the Senior PGA Tour. We contacted over 150 companies, most of them Canada's largest companies, and all six major banks. The sponsorship opportunity was declined each and every time. When all possible alternatives had been exhausted, the RCGA turned back to du Maurier for the support they needed, and their contribution enabled the event to be held.

As a sport governing body, the implications for the RCGA are profound. They count on their profits from large events like this to find the grass roots development of the sport. If the funding cannot be replaced, the whole sport suffers.

As you can see, there are complex issues below the surface.

Now, imagine a market where 370 organizations and 20 major events are all forced to replace tobacco funding simultaneously. Even if they had the resources of an IMG to help find the support, the vast majority would fail and there would be complete chaos in the market. Competition would drive prices down, and the event industry, at least that part that counted on tobacco company support, would be decimated.

For those larger, higher profile events, they might find a way to survive. I stress the word "might". There would likely be a five- to seven-year transitional period before a new sponsorship structure could be created and funding could be maximized from replacement sponsors. This was certainly our experience in 1992 when the RCGA again sought to replace Imperial Tobacco's money with non-tobacco corporate funding for the Canadian Open. It took the better part of six years to build a coalition of 14 companies, including Bell, which is now title sponsor, to replace the former level of financial support. In this case, we were working to secure sponsorship funding for only one event, not competing with 20.

The event survived in the meantime only because annual ticket sales exceeded 100,000 per year and brought in millions of dollars of non-sponsor funding. Unfortunately, few events in Canada have that kind of safety net. Nonetheless, from a sponsorship point of view, this event is the exception rather than the rule. Few other events combine the same kind of customer hospitality opportunities with 105 years of tradition, history and prestige.

I would like to conclude my remarks with a point of view concerning a suggestion I have heard that tobacco companies will continue to invest in major Canadian events regardless of the restrictions of Bill C-71. Sponsorship prices are set according to quantifiable benefits, things such as tickets, hospitality, signage, television ads, and all the various benefits that come in a package. These benefits normally account for anywhere between 10 per cent and 25 per cent of the value. The rest of the price is determined by the promotional value of the sponsorship, something we call the intellectual property right. Those kinds of things are image transfer, good will, prestige and positive public relations.

According to the proposed legislation as it currently stands, tobacco companies will lose the right to advertise their affiliation with an event in almost all circumstances and hence lose the promotional value and recognition, the intellectual property value I mention moments ago. What company would proceed with a seven figure investment in a major Canadian event and then only accrue 10 per cent to 25 per cent of the value? I personally know of no corporation that would agree to sponsor an event under these restrictions.

Thank you very much for your time. I would be happy to answer any questions you might have after my colleagues have spoken.

Mr. Rupert T.R. Brendon, Chairman pro tempore, Coalition for Commercial Freedom of Speech: Good morning, Madam Chair and senators. My name is Rupert Brendon. I am President of the Institute of Canadian Advertising, one of the founding members of this coalition. Together with our sister organization, known as the Association of Quebec Advertising Agencies, our combined membership of advertizing agencies collectively account for 90 per cent of all advertising revenue in Canada.

I appear before you today as the Chairman pro tempore of the Coalition for Commercial Freedom of Speech. Our organization currently comprises the following advertising associations and media: The Outdoor Advertising Association of Canada; Canadian Magazine Publishers Association; CTV; Maclean Hunter; the Toronto Sun; and both the Institute of Canadian Advertising and the Association of Quebec Advertising Agencies, to which I referred.

It probably would have been less trouble if we and the other intervenors did not object to Bill C-71, did not criticize it and simply let it become law. However, if the 1995 Supreme Court of Canada decision in RJR-Macdonald v. Canada has any validity, the coalition cannot sit back and let Bill C-71 pass without a challenge.

We believe Bill C-71 is fatally flawed in at least three respects. First, it unreasonably limits the number of media permitted to carry tobacco brand advertising and tobacco sponsorship advertising. The selection of permissible media is arbitrary and unjustified. The exclusions are arbitrary and unwarranted.

Second, the bill creates criminal offences. However, by crafting the bill in language that, at worst, is almost impossible to understand and, at best, highly obscure in its meaning, the advertisers, their agencies, and the media are severely handicapped and prejudiced.

Third, if indeed the government is sincere about permitting, not banning, tobacco brand and sponsorship advertising in Canada, Bill C-71 adopts the worst kind of restrictions and disregards advertising pre-clearance, which is the most sensible approach to regulation.

We have all been told not to worry about the obvious deficiencies in Bill C-71, that regulations to the act will clear up the ambiguities and eliminate the problems and contradictions in the underlying statute. However, one must be sceptical that this is not just a smoke screen to deflect legitimate criticisms which need to be taken seriously. If the basic blueprint, namely the statute, is significantly flawed, then the regulations cannot make it right. A leopard cannot change its spots.

To the members of our coalition, the key question following the demise of the TPCA was never whether there should new tobacco advertising legislation to replace the TPCA, and our coalition does not oppose a regulation of tobacco advertising or tobacco sponsorship advertising per se. The principal objectives of Bill C-71 are decent and eminently supportable.

To the coalition's members, the legitimate questions to ask are these: What kind of legislation will Bill C-71 be? Is this bill a fair and reasonable way to accomplish its stated purpose? One is tempted to ask: Is it equitable? By what mechanism will Bill C-71 be implemented? Finally, are its deficiencies curable before the patient dies?

When the Honourable David Dingwall, the Minister of Health, appeared before this committee on March 19, he referred several times to the 1995 Supreme Court of Canada decision in RJR-Macdonald v. Canada. As the honourable minister observed, the Supreme Court determined that restrictions on the promotion of tobacco products are a legitimate means to achieve the government's health objectives. With that premise, our coalition totally agrees.

However, the minister went on to say that such curbs are an appropriate response to the health impact of tobacco. With the latter very broad statement, one can hardly agree. What curbs could the honourable minister be referring to? The Supreme Court of Canada has not yet officially seen, let alone ruled on, Bill C-71, so the Supreme Court of Canada cannot be blessing Bill C-71 in advance. How the Supreme Court of Canada would react to this bill remains to be seen. At most, the words "such curbs" can only refer to reasonable laws as in the statement, "Reasonable laws are an appropriate response to the health impacts of tobacco."

The honourable minister also said that if Bill C-71 actually banned the promotion of tobacco products, there may be some validity to the arguments being made that the bill unreasonably violates the tobacco companies' right of freedom of expression, but that such arguments do not stand up because the proposed legislation does not ban tobacco promotion but actually allows product advertising.

Honourable senators, let us question these declarations to see whether they actually stand up. Is it reasonable or necessary to prohibit newspapers, the majority of magazines, point of sale, billboards, and other outdoor media for use in tobacco product advertising? Does anyone acting reasonably know for certain what advertising content will not appeal to persons under 18 years of age? Is it fair or reasonable to impose severe criminal law sanctions if, without guile or intent, one makes the wrong guess? Does anyone know with certainty what is meant by the phrase "tobacco product and its characteristics"? Can anyone feel more sanguine after reading in an official government document that certain government officials doubt the legitimacy of some factual informational statements about lower yields of tar in cigarettes, a statement which, though absolutely true, is, according these government officials, deceptive and therefore actionable under Bill C-71 if expressed in advertisements?

How often does one come across an advertisement which does not associate the advertised product with a way of life -- for example, a way of life that could include glamour, fashion, recreation, sailing, eating, excitement, or risk and daring such as snowmobiling, skiing, or snorkelling? Putting the question another way, has one ever seen an advertisement for any consumable product that does not evoke a positive or negative image of a way of life or that does not evoke a positive or negative emotion about a way of life?

Lifestyle advertising as divined in clause 22 is really a definition of brand advertising in general, and to prohibit it, as it is prohibited in Bill C-71, is, in effect, to ban tobacco product advertising. That is the very same thing the Honourable Minister of Health told you would unreasonably violate the tobacco companies' right of freedom of expression, if it were doing it as we allege. This is the very principle, the most fundamental of rights, that the Supreme Court of Canada said must not be violated.

Let us say we have not totally convinced you that the effect of this advertising is to ban tobacco product advertising. We ask you: Is it fair and reasonable to require tobacco product advertisers and tobacco sponsorship advertisers to be in doubt about the propriety of their advertising? Would a reasonable person gamble his freedom and a $300,000 fine on the possibility he is right but he might be wrong? Would it not be fair and reasonable, would it not be prudent, would it not be cost-effective, and would it not produce an all-around better result if tobacco advertising were pre-cleared under a review procedure which paralleled the U.K. system of tobacco advertising pre-clearance? That, in Canada, has been blessed by the same ministry of health as being appropriate and desirable for food and drug products and is used for a host of other products and services that are regulated in the interests of maintaining the good health of all Canadians.

Senators, our coalition put Part IV of the bill to the test. We wanted to know what kind of tobacco product advertisements were possible given the constraints of Part IV. We asked three prominent Canadian advertising agencies to create tobacco brand advertisements that met the requirements of Part IV or that at least did not appear to run afoul of clauses 19, 20, 21, and 22. We reported on this test in the written brief we filed with you. The bottom-line result was that there was no unanimity of opinion amongst the group as to whether the ads did or did not comply, nor was any member of the agencies and coalition convinced that any of the ads were safe from prosecution under the bill. They agreed that they could not recommend to their clients that the ads were safe to run, especially since the consequences of error of being found criminally wrong were so severe. The only agreement amongst us concerned the few ads that we thought would not fly. You might be surprised at the ads we turned down using the provisions of Part IV as our only yardstick.

On behalf of the coalition, I have now highlighted some of the issues which we refer to in more detail in our filed brief. With your permission, I would like Mr. Engle to take the questions that will be directed at me. He is an advertising regulation expert and the coalition's legal advisor. He can respond to the senators' questions at the appropriate time. Thank you for granting this audience.

The Chair: Thank you, Mr. Brendon. It is acceptable that your legal counsel take your answers.

Mr. Pénisson, please proceed.

[Translation]

Mr. Nicholas Pénisson, President, Société d'affichage Flashmédia: I represent Flashmédia, a business my father and I founded in 1986 in Montreal.

Our publicity displays can be found in retail businesses that sell candy, groceries, magazines and cigarettes.

In ten years, our display network has expanded throughout the country. We now have 13,000 signs that can be seen from Quebec to Vancouver. Those 13,000 display signs provide work for 25 employees who contribute to the income of our various suppliers. Those 13,000 signs, developed over the past ten years, have cost us $1.5 million in investments.

An important percentage of those who use our publicity supports come from the tobacco industry. I would like to mention that we still owe the tidy sum of $1.4 million. We strongly hope that our banker will continue to be understanding once Bill C-71 has been passed.

This very strict bill would have, as you can imagine, very damaging consequences for us.

What I find deplorable in this bill, and this is why I am here today, is not the government's objective to reduce smoking among young people of less than 18, but the lack of consistency in the means it intends to use to reach its objectives.

Nothing has to date proven a cause and effect relationship between tobacco publicity and an increase in cigarette consumption among young people. On the contrary; allow me first of all to give you some statistics and facts:

In British Columbia, tobacco publicity has been regulated since 1972, and yet the percentage of smokers there is no different from that in other Canadian provinces.

The previous law on tobacco products control in 1988 completely eliminated tobacco publicity, and yet, in the seven years that followed, the number of smokers increased considerably among young people.

Finally, five European countries imposed a total ban on tobacco advertisements, and in each of those countries there has since been a slight increase in the overall consumption of tobacco.

Where are the scientific references that allow the government to state that controlling tobacco advertisement will contribute to decreasing consumption?

I would like to draw your attention particularly to a point that clearly brings out the ambiguity and contradictory nature of this bill. Still under the pretext of preventing young people from taking up smoking, publications whose readership is made up of 85 per cent or more of adults could continue to publish tobacco advertisements.

That minimum number of adult readers leaves us somewhat skeptical about the remaining 15 per cent, which would be made up of non-adults. I conclude that it would be made up of young people of 18 years or less.

In any case, what does readership mean when a company publishes a full-page ad on the back cover of a magazine? That page, you will admit, is accessible to hundreds of people who have never read a single line of the magazine or daily publication involved.

Paradoxically, in the waiting rooms of dentists or doctors, the same magazines can be found. Are those places reserved for adults only? What can we do about them?

Will we have to force health professionals who rent such places to destroy the controversial advertisements in the magazines they put at the disposal of their patients?

Let's imagine that Bill C-71 applied to another sector of economic activity, such as the automobile industry, for instance.

The text of the bill would say to manufacturers: from now on, you will be forbidden from publishing advertisements where people appear. We will censure any reference to luxury by forcing you to cover your vehicles. You will from now on have to warn the consumer that driving an automobile is dangerous, and can provoke serious accidents leading to severe injuries or death. No more test drives, and you are forbidden from advertising your prices. The government will control everything by imposing excise taxes that will triple or quadruple the sale price of your product.

And the same analogy could be applied to the beer, wine and spirits industry, among others.

To summarize, the bill as it stands now can only lead to consequences that will be catastrophic for some, while not necessarily allowing you to reach your objectives.

Will forbidding the display of cigarette advertisements not have the opposite effect, that of attracting young people to cigarettes even more than before? Temptation is that much stronger when you are dealing with a forbidden product. While we agree that we should take steps -- we already have done so by scrupulously respecting the self-regulation of cigarette manufacturers that forbids posting ads within 200 meters of schools -- we oppose the total ban on tobacco advertisements in this bill because the bill is much too vague and ambiguous, and contains an ill-thought-out list of superficial measures that mask the real problems that cause young people to take up smoking.

It is essential to ensure that this law is fair for everyone.

[English]

Mr. David C. Pigott, President and Chief Executive Officer, Eddy Match Company Limited: Madam chair and honourable senators, my name is David Pigott. I am President of the Eddy Match Company as well as co-owner of the firm. I know little about legal and constitutional issues and will leave those to my more knowledgeable fellow panellists. However, it might be helpful for you to have some appreciation for the collateral damage that the legislation might unintentionally cause, and so I will restrict my comments to something I do know a bit about: the economic impact on a single company like Eddy Match. In order for you to appreciate what Bill C-71 means to us at Eddy Match, I want to tell you a little bit about our company and what we have been going through in our fight to stay in business.

Eddy Match was founded 146 years ago just behind Parliament Hill in Hull, Quebec. In the 1920s our operations were moved up the Ottawa Valley to Pembroke, Ontario, and at approximately the same time the business was sold to British interests. The company remained in various foreign hands until two years ago when the former owner called me to tell me he had had enough of the match business and Canada and would I please find him a buyer for the company. The obvious choice was to sell out to our American competitors who would have immediately shut the factory and moved the business into their plants south of the border. My partner, the company CFO, and I negotiated an alternate deal which saw the two of us buy the company, and in doing so we have managed to keep not only our own jobs but those of 123 other people who would otherwise be out of work.

The vast majority of these people would likely have gone on UIC and then welfare. For the most part, these are workers skilled at making matches but little else, and they live in an economically depressed region in the upper Ottawa Valley where jobs are scarce. Many are older workers who have had little experience outside Eddy Match. Their average age is 48 and over one-half our employees have more than 25 years with the company. I am fond and proud of these people but, realistically, given their skills, their age, and the location in the upper Ottawa Valley, they are unlikely to be retrained for anything more than counter help at McDonald's or Becker's.

The economic climate of the past decade, combined with municipal bans on smoking in restaurants and bars, have resulted in a relatively dramatic decline in our customer base. If you cannot smoke in a restaurant or bar in Toronto or New York or Los Angeles, the operators do not bother to reorder their matches. We suffered another major hit with the influx of very inexpensive plastic disposable lighters from the Far East, primarily from mainland China. Due to the export of those cheap lighters from the Far East, we closed a plant and laid off 56 people in 1995, about the hardest thing I have ever done. This year over 60 million plastic lighters will enter Canada to be used and thrown in the garbage. You cannot recycle them. That represents approximately 600 jobs that used to exist in the Canadian match business. Finally, since the new year, we have been hit with a price war in the grocery store match market as cheap product is now flooding in from Chile under free trade and as American manufacturers try to drive us out of business in order to gain a larger piece of the declining market.

Through all this, the employees of Eddy Match have not given up and we have continued to fight to keep our jobs. The one market that has kept us alive has been tobacco-related advertising, especially with the resurgence of orders from Canadian tobacco companies following the elimination of TCPA. These orders are either in the form of advertising matches given to retailers directly by tobacco companies or the sale of advertising space on matches which we then sell to the retailers. If we had not had that tobacco-related business over the past year, I would not be here today. When the TPCA banned tobacco advertising last time out, we laid off approximately 25 people -- about $1 million in payroll in Pembroke, Ontario. If it is banned again or if matches are effectively eliminated as an advertising medium, I will be laying off 125.

Tobacco companies like match-based advertising because it is very focused. It is directed right to their consumer group of existing smokers, and with match advertising they get a large number of advertising impressions for a relatively low cost. It is a terrific vehicle for brand-to-brand competitive advertising. Given that it is such a useful means of advertising directly to smokers, we have even offered the advertising space to the federal government so that they can get their health message out to Canadian smokers. Unfortunately, we have made no sales to date. Non-smokers, on the other hand, rarely pick up matches at convenience stores counters. From our perspective, when non-smokers need a match, they generally buy our branded and private label product from grocery and hardware stores -- that is, the wooden matches, not book matches.

My company's concerns with Bill C-71 relate primarily to clauses 29(a) and (c), which state that no tobacco manufacturer or retailer shall offer or provide any free gifts, premiums, et cetera, to encourage the purchase of a tobacco product; nor can they furnish an accessory, such as matches, that bears a tobacco product-related element -- I think that means a brand -- without consideration. In other words, you must charge for the matches. Retailers are often in the habit of allowing customers to take matches which have been supplied to the retailer by the tobacco companies as a convenience to the customers buying the cigarettes.

It is unclear whether clause 29 makes it a crime to leave matches on the retail counter space for any customer to take whether or not they buy a pack of cigarettes. It is clear, however, that a retailer allowing only purchasers of cigarettes to take matches would be in violation. It seems ridiculous. We are talking a penny match here. In light of threats of $50,000 fines and prohibition from selling tobacco products for one year, it is unlikely that retailers will take the chance of offering matches free to customers who want them, thus exposing themselves to prosecution under Bill C-71.

The fear and confusion over this issue has already begun to cost us orders even before the legislation is implemented. Some store owners have refused product-bearing tobacco advertising because they do not want to take any chances that they might get hit with the proposed fines should these products still be in inventory in their stores. While it seems ludicrous that the corner store owner could be fined tens of thousands of dollars because a counter clerk did not collect a penny for a match, many store owners will not risk it. They are too frightened of the legislation. Tobacco companies are also being extremely careful as they are unsure if they can give matches to those stores.

Since this legislation was announced, we have seen large numbers of tobacco orders cancelled or put on hold as tobacco companies debate back and forth as to whether it is an allowable form of advertising and whether they can give matches to corner store tobacco retailers. Approximately 25 per cent of those tobacco-related orders are for sponsorship events such as auto racing, finishing, tennis, golf, music or whatever. If the legislation kills tobacco advertising related to sponsorship at retail, you automatically kill that business for our company.

Our major concern is the vagueness of Bill C-71 and the uncertainty that is created as a result. Given that uncertainty, and in light of the severe punishments that the legislation threatens, I believe my customers, the tobacco companies and the tobacco retailers, will err on the side of caution and not buy my product. Therefore, I am asking that clause 24, which bans matches at retail that promote sponsored events, and clause 29, which prevents a retailer from giving away a pack of matches with a purchase of cigarettes, be either eliminated or redrafted to clearly allow the free provision of this advertising medium.

I am not arguing that there is not a legitimate need to control tobacco advertising, just that the proposed legislation is in need of more work so that, in controlling how tobacco is advertised, you do not unnecessarily harm businesses like Eddy Match. I can quite bluntly tell you that if we lose our tobacco advertising sales, we will not survive, and one of Canada's oldest manufacturing companies will cease to exist.

The Chair: Honourable senators, our final panellist today is Mr. Gallop, who asked if he could appear this morning because he had something to contribute that would not be addressed by other individuals on this panel.

With that restriction in mind, Mr. Gallop, please make your representation.

Mr. Peter Gallop, Chairman and CEO, Gallop & Gallop Advertising Inc.: Honourable senators, I am here today representing 1,100 colleagues in the Outdoor Advertising Association of Canada, an organization founded in 1903 and representing 40 companies that operate in 275 communities across Canada with over $200 million in annual revenues. Like many others, we agree with the purpose of Bill C-71, but we believe it can be improved without detracting at all from its stated purpose.

You have now a copy of our OAC brief. I will not review it in total but would like to draw your attention to a few points that are unique to our unique industry.

Incidentally, the coalition covered part of our presentation. We will not be repeating that, or I will try not to do so. Basically, the coalition was concerned with content of advertising; we are concerned with the form of advertising. We are the media. We are being asked to place the adds. It is quite a different situation.

First, many provisions of the bill relating to our industry are unclear. For example, the terms "advertising" and "promotion" are defined broadly while the terms "signs" and "publication" are not defined at all. We do not know which term applies to our medium, to the outdoor media.

Minister Dingwall said to this committee that details would be all spelled out in future regulations. He also said Treasury Board requires that affected parties be consulted, but we have not seen these regulations and we have not been consulted. He also assured this committee that the proposed regulations will be debated by a future Commons committee, but it is not clear how this will allow us any input.

Second, on page 4, paragraph 14 of our brief, we make the point that except for sponsorship, there are no transition periods or proposed proclamation date. It is physically impossible for our industry to achieve immediate compliance with Bill C-71. We are not a printing press that can be turned off. We have long-term obligations to fulfil. We suggest a transition period for outdoor advertising to October 1, 1998, the same as has been granted to sponsorships.

Third, on page 5, paragraph 15, we make the point that outdoor advertising is totally banned by Bill C-71, not restricted. Outdoor advertising is one of the very best and most economical ways for events to promote ticket sales by reminding people of the dates and locations of the event and by attracting tourists, visitors, and others who are unlikely to know about the event otherwise.

When Minister Dingwall presented to this committee, he asked you the following questions: "How much is enough? How many billboards, banners, flags, posters, bus panels, street-level kiosks and newspaper and magazine ads bearing the tobacco brands are required to ensure the commercial viability of sponsored events?"

We do not know the correct answer to the minister's question, but zero is surely not the correct one. Bill C-71 prohibits entirely all billboards, banners, flags, posters and street-level kiosks for tobacco-sponsored events, notwithstanding the fact that the event sponsor's name can only appear on the bottom 10 per cent of the copy area and will be therefore virtually illegible. Surely, total prohibition is excessive and contrary to the Supreme Court's ruling.

Fourth, page 7, paragraphs 23 to 25, and also in Appendix E, concerns a new research study about billboards that was published a month ago. Billboards are located on heavy traffic roads and commercial areas designed to reach people in automobiles. The recent independent Canadian research study done throughout 1995 and 1996 provides an accurate measurement of the billboard audience. Actually, this is the first time this has ever been done. I might add that it was not done for the purpose of this bill. The results show that 94 per cent of potential viewers of billboards are adults -- that is, 94 per cent of all the people passing all our billboards are over 18 years are of age. Bill C-71 allows tobacco advertising to run in print media having an 85 per cent adult readership. Billboards greatly exceed that threshold and should be included in the exemptions to this bill. To accomplish this, we suggest that outdoor advertising be treated with the same rules and definitions as all other publications or print media.

Finally, the big question, since outdoor is the only medium that is essentially being totally banned by Bill C-71, the big question is: Does outdoor advertising influence the decision to begin smoking? The Minister of Health said to this committee, "We are not dealing with the Girl Guides of Canada; we are dealing with the tobacco industry, which is one of the most sophisticated you will find anywhere in the world, comparable to the Pepsis and Coca Colas and Nikes". I found this remark somewhat demeaning to the Girl Guides of Canada, an organization that should be on the minister's front line of defence against tobacco. He should be supporting the girl guides with the same kind of money that he spends to support the Non-Smokers Rights Association -- it would probably do him more good.

Also, I regret to disappoint the minister, but Coke, Pepsi and Nike collectively spend less than 4 per cent of their advertising budgets on outdoor advertising, precisely because they want to target youth, and outdoor advertising reaches mainly adults.

Throughout the debate on Bill C-71, different opinions have been offered regarding what really influences people to take up smoking, but opinions are not sufficient. The onus should be on the government to provide proof, and Senator Nolin made that point again this morning.

You also heard yesterday that after 70 days of Supreme Court hearings, there was no proof that advertising does in fact create a basic demand to begin smoking. The government's own 1994 youth survey offers no mention of advertising, sponsorship advertising or billboard or outdoor advertising as reasons why youth start smoking, and neither does the government's November 1996 background document on youth smoking, behaviour and attitudes. This is included in Appendix C of our brief.

We have also included, in Appendix D of our brief, the summary of the study of 22 countries done by U.K. researchers over 27 years which determined that in those countries with full tobacco advertising bans, consumption of tobacco products actually increased slightly. The same, as you heard yesterday, applies to Canada during the TCPA from 1989 to 1995. Incidentally, the same has been true in British Columbia since 1972. There has been a total prohibition on advertising on billboards, in newspapers and in all media except national magazines, and smoking in British Columbia has essentially remained the same as in other parts of Canada since that time.

Many experts think that smoking by young people may increase as a result of prohibitions on advertising, which tends to make smoking more clandestine. You have heard that opinion expressed. A second theory is that the health warning lines are also eliminated when ads are banned and perhaps their constant presence does discourage some young people from smoking.

I have a third theory, and that is that maybe some of the advertising is so bad that it puts people off; it removes the curiosity factor for young people because they are not enticed to try that product.

I am sorry to say that to the advertising industry, but it is a fact.

The bottom line is that there is a lot of evidence that smoking will not decline as a result of banning outdoor advertising or sponsorship for tobacco products, and if smoking does not decline, the argument that this is purely a health bill also disappears, as does the argument that it may not do any good, but it will not do any harm because we know, as we have heard from many witnesses, that it will do harm. It will cost the economy jobs and money.

Finally, the OAC sought a legal opinion from Teplitsky, Colson, barristers. It is an eight-page opinion found at Appendix B of our brief. It is also summarized at page 2, paragraph 9, of our brief.

It will not surprise any senators that the opinion of our legal counsel is that Bill C-71 does infringe the Charter in many areas. It also, I hope, will not surprise you that they say it can be easily fixed. Of course, that is our objective in coming here today.

In summary, we ask senators to consider fully all the amendments offered, in particular the following: First, support the amendments of the Alliance for Sponsorship Freedoms as guidelines for sponsorship promotion because their guidelines conform closely to the Charter provisions. Second, provide for equal treatment of outdoor advertising with other print media. Third, establish a firm date for Part IV of the bill to come into force. We are recommending October 1, 1998. Fourth, in the conclusions of our brief, on page 9, we recommend strongly that the government spend considerably more than it now does on anti-smoking promotions, especially as part four of the purpose of this brief is "to enhance public awareness of the health hazards of using tobacco products".

We do not think the sole responsibility for this should be left with the tobacco companies themselves. If Minister Dingwall admires Coke, Pepsi and Nike, he must be prepared to spend on anti-smoking promotions the same amount of money that they spend to promote their products which, incidentally, was $78 million in 1996.

The $5 million to $10 million that the government has been spending or proposes to spend annually is a pittance for a problem of this nature. It represents less than 0.002 per cent of the money the government collects from tobacco. To put it another way, it also represents less than 30 cents per year per Canadian on anti-smoking education programs. It should be, in our view, $3 per Canadian at least, which would be $90 million. We believe that every Canadian would agree with that, even Paul Martin. Of course, it would also help other companies at this table, such as Eddy Match.

The Globe and Mail reported two weeks ago that Minister Dingwall recently spent twice the amount he is planning to spend on anti-smoking promotion, i.e., $20 million, to create 300 jobs in his riding of Cape Breton. Unless Bill C-71 is amended, he will be destroying thousands of jobs without reducing smoking one iota.

Please amend Bill C-71.

Senator Nolin: Have you been consulted by the Department of Health? Have you asked to be consulted? Have you offered your help?

Mr. Brendon: We have not.

Mr. Pigott: I am not an advertising agency, a coalition or a lawyer. I just run a small company. I tried many times over the past months to see someone in the minister's office or the department or the minister himself. I was stonewalled; I got nothing. I was really surprised that I was invited here. It is very frustrating.

Mr. Brendon: We applied to appear before the Senate committee as the Institute of Canadian Advertising as well as the Coalition for Commercial Freedom of Speech. We were accepted as the coalition and that is what we are appearing as.

Senator Nolin: In Bill C-71, the government has made an immense effort to explain legally what you are doing, but have you been consulted?

Mr. Brendon: Not at all.

Mr. Gallop: We did ask to be allowed to appear before the House of Commons committee on health.

Senator Nolin: I am talking about before the bill.

Mr. Pigott: We knew nothing about the bill until it surfaced about the end of November. We did request a meeting at that time with the Minister of Health. We got a meeting with one of his assistants on this file. It was interesting to note that she sent dossiers to all the other people we were meeting with that day, telling the other side of the story. I guess she was doing her job. That is all we can say about that.

Senator Nolin: Mr. Brendon, your members are probably producing the government's anti-smoking advertising. Do you know what effect that advertising has?

Mr. Brendon: I am not sure who is creating that advertising, and I am not aware of any studies that say it has been effective. On the contrary, everything I have heard in the last two days suggests that the prevalence of smoking is flat.

Senator Nolin: You agree with me, do you not, that members of your coalition are receiving huge advertising contracts from all governments trying to inform young Canadians that starting to smoke is bad?

Mr. Brendon: Absolutely.

Senator Nolin: Do you agree with me on that?

Mr. Brendon: Yes.

Senator Nolin: But you have no data telling us whether that money spent by the government is effective.

Mr. Brendon: I have no information on that. I have no evidence that it is effective or that it is even being measured. I cannot explain anything about that.

Senator Nolin: My last question is probably to Mr. Engle.

Reading your brief, you say you did an experiment with your members.

Mr. Brendon: Yes, sir.

Senator Nolin: With all the conditions that were given to the ad agencies to prepare some print advertising, where is the real problem? What is not clear in Bill C-71?

Mr. Rafe Engle, Legal Counsel, Coalition for Commercial Freedom of Speech: Reducing it down to its simplest element, I suspect the real problem is in the definition of "lifestyle advertising". There is a lack of certainty over how far it should go and what it catches within the net. As well, there is a concern that you cannot create advertising effectively, or if you can create advertising at all, it will offend against that definition in the bill.

As we said in the submissions this afternoon, both written and oral, there was no consensus. We did not know how we could succeed. We came to the consensus on clear evidence of samples of advertising that would fail.

Oddly enough, even an advertisement that featured a health warning on the bottom of a package and nothing else, in the general opinion of professionals regarding the proposed statute, would have been offensive and therefore created a liability, which is nonsense. We agreed it was nonsense.

There are many issues and problems. You have heard them paraded before you, and you will hear more before the week is out. Essentially, the problem we have is a lack of certainty and a tremendous amount of confusion about the ambit and the extent of the prohibition. We are particularly concerned about issues arising in connection with lifestyle advertising and the added notion that lifestyle advertising, as it may on some reasonable interpretation, apply or become interesting to kids.

Senator Nolin: More specifically, you are talking about the definition in clause 22.

Mr. Engle: Yes. We were also concerned about a lack of certainty, clarity, or predictability about the combination, for example, of clause 20 with some apparently innocuous references.

When you consider that the advertising agencies may well be caught up in the net of culpability and that their concern is, like the media, that there is a responsibility which they do not deny, they want to ensure that before they start to venture into the lion's den, they can acquit themselves of responsibility for their own work and their clients who pay their bills.

Senator Nolin: What is your opinion of the catch-all clause 19?

Mr. Engle: Enormous concern. If you do not get us coming, you will get us going. This is not a question of catching.

The direction to all of the advertising agencies was, "Look, our responsibility is to act responsibly, to create effective but measurable advertising that does the job and satisfies the requirements of law." When we were presented with a proposed bill that wanders in so many different territories, the limits of which are not clear and certain, we find ourselves not only confused but concerned.

If that were the beginning and the end of it, if there were no other answer, we would try to make recommendations to you about how particular clauses might be modified, adapted, clarified or made more certain. However, better systems are available. That is what provoked the coalition to assemble as a coalition and the ICA to make representations about borrowing from existing experience elsewhere in Canada and abroad in search of a better system of regulation.

Senator Nolin: Does the coalition support the objective of the bill?

Mr. Brendon: Yes, absolutely.

The Chair: Mr. Pigott, like you, I am not a lawyer. When I read clause 29, I want to assure you that I have the same understanding of clause 29.

My reading of that clause is that tobacco companies cannot advertise on matches. However, hotels and restaurants could advertise on matches, as well as stores or anyone else selling a tobacco product. Is that how you interpret that clause?

Mr. Pigott: Yes. The minister has clarified and stated that the legislation would not prevent a restaurant or hotel from advertising on matches. The problem is, they do not fit the bill any more; the tobacco companies keep us going. If I lose that, I am toast.

Senator Lewis: I presume you are all familiar with the Tobacco Products Control Act which was passed in the 1980s and upon which the Supreme Court passed judgment on certain sections thereof. That act maintained a total ban on advertising of tobacco products. Are you all familiar with that?

Mr. Gallop: I am to a certain degree.

Mr. Brendon: Yes.

Mr. Merrall: To a certain degree.

Senator Lewis: That act must have had quite an effect on you, the same as the present bill might have. You must have all been concerned about that act when it was passed.

I get the impression this morning that you seem to be surprised by this government's initiative in Bill C-71, whereas the former legislation was probably more Draconian.

Did you make any representations at the time that act was presented as a bill? I believe it was in Parliament for some time before it was actually enacted.

Mr. Brendon: That was before my time.

Mr. Gallop: In many ways, Bill C-71 is more Draconian because of the catch-22s, because of the various clauses that do not work with one another, because of the vague wording of the lifestyle requirements and because of the ban upon sponsorship as well as advertising. As I mentioned in my presentation, there is no transition period. We tried to appear before the House of Commons committee. As you may know, it was a very shortened hearing. They tried to race it through in two days, and only about five or six witnesses received a chance to appear.

A year before that, while they were drafting the legislation, why did they not call Mr. Brendon and say, "Given that you represent 90 per cent of all the advertising agencies in the country, what would you like to see in these regulations"? Why did they not speak to our industry that represents 99 per cent of all billboards in this country and ask us for some input? We would have given the input.

We would like to see specific and clear-cut restrictions. As other people have said, we agree with the objectives of the bill. We believe there should be some restrictions and regulations on tobacco advertising but not total prohibition. Being in the industry, we know how to control those things better than some government officials working in a vacuum, but they do not seem to want to talk to us in this industry. Just as you heard yesterday, they do not want to consult with the tobacco manufacturers themselves.

Senator Lewis: You did testify on the previous act.

Mr. Gallop: We were called as witnesses at the Commons health committee and again at the Senate committee. I believe a different Senate committee reviewed the previous legislation, but very few changes were made. The only thing we got was a two-year transition period as a result of those representations.

Senator Lewis: Over the years, you must have been aware that various governments were very concerned about this situation.

Mr. Gallop: Yes, I was very aware of that.

Senator Jessiman: Mr. Merrall, of the 64 offices in the 29 countries, which of those countries have bans on tobacco advertising? Is it true that the United States will place a ban on tobacco sponsorship of both the arts and sports?

Mr. Merrall: I am not equipped to provide an answer to that question. My responsibility within IMG is the Canadian market. I am not actively involved in our businesses in the United States or Europe. It would be very difficult for me to answer that, as much as I would like to.

Senator Nolin: Maybe you could get that information for us.

Mr. Merrall: I would be happy to.

The Chair: If you can, we would be delighted to receive it.

I want to make it clear to those of you who are assembled as to why you were selected to appear. As you can imagine, some individuals were accepted to be witnesses before the Senate committee. The steering committee, comprised of Senator Lewis, Senator Nolin and myself, wanted to ensure that every point of view be represented, not that the same point of view be represented 15 times. That is why we are pleased, Mr. Gallop, to have you appear today because you seemed to say something much different from what other panelists have said. That is the basis upon which the witnesses were chosen.

As you know, our hearings will continue the rest of this week and into next week. We will try to hear from all points of view, and we thank you for presenting your points of view today.

Senator Nolin: Mr. Gallop, I will say to you what I said to Mr. Poirier. When I read page 7 of your brief, in paragraph 24 you state, "...although advertising is an adult print medium." Who says so? You?

Mr. Gallop: No, this is independent research study.

Senator Nolin: Tell us. My kids see those billboards.

Mr. Gallop: That is a good question and a fair question because I did not have time to cover it in detail.

The study was done by Trend Search Group Inc.They were retained by the Canadian Outdoor Measurement Bureau. It was done for other purposes. It was done to find out the demographics of our audience for our general purposes. It had nothing to do with this bill. The study was done on week days, prime-time traffic, non-prime time traffic -- that is, rush hour traffic and non-rush hour traffic -- evening traffic on week days and weekend traffic. It carefully balanced all of those different things.

Senator Nolin: Have they surveyed pedestrians?

Mr. Gallop: Yes. We have surveyed pedestrians as well. This study did not survey pedestrians, but pedestrians only account for about 2 per cent of our total audience. The survey of pedestrians suggests that about 15 per cent of pedestrians are youths or under 18 years of age. If you take the 94-per-cent figure in the automobile traffic and add that to the 15 per cent of pedestrians, you would still be at 93.35 per cent.

That is one of the restrictions we would be prepared to make, senator. We know which panels have heavy pedestrian traffic. We would be prepared to say that we will not post any tobacco advertising on pedestrian-type panels, just as we have agreed not post anywhere near schools or 200 metres from schools. That is the kind of thing we are talking about.

The study looked at 88,500 cars in 12 different cities across Canada, so it is an extensive and major study. The researchers stand by the road at randomly selected points in each city. They is a computer random selection process. Then they write down the number of occupants in the car and make a visual observation on whether the person is over 18 or under. Of course if somebody is 35 or 25, it is very easy to do. In fact, they broke it into more age groups than that, but the only one we are concerned with here is over and under 18. We think it is very accurate. In fact it is probably plus or minus 1 per cent in degree of accuracy. You could check with the group that did the study or with the Canadian Outdoor Measurement Bureau, or I could get more information for you.

Senator Nolin: Your contention is that that is the reason why Coke and Pepsi are not billboarding. They are not doing that because it is not reaching their target group.

Mr. Gallop: It is not reaching their target audience.

The second thing is they have an advantage that the tobacco companies do not have of being allowed to use the broadcast media, particularly television. They can selectively target programs which are more oriented to youths, and so it is more efficient for them.

The Chair: The study measured vehicle occupants. Why did it not measure school buses? If you want to see kids and take a look at what they are doing, why would you only study vehicle occupancy, 95.6 per cent of which are adults?

Mr. Gallop: Very few school buses go by billboards, senator, even if you include all of the school buses.

The Chair: I beg to differ. As a former teacher, I know that a lot of school buses went by billboards. They had an enormous influence on the youngsters.

Mr. Gallop: They are not looking at them.

If the Department of Health would consult with us, we would gladly restrict or allow for a complete prohibition on transit advertising because we know kids ride in buses and on subways. That is an example of the kind of thing we would like to sit down and be part of. We are an affected party. As I said in my prepared comments, we would like to interact with people on those kind of things, but we do not know who to talk to.

The Chair: Thank you.

The committee adjourned.