Proceedings of the Standing Senate Committee on
Transport and
Communications
Issue 29 - Evidence
OTTAWA, Tuesday, May 11, 1999
The Standing Senate Committee on Transport and Communications, to which was referred Bill C-55, respecting advertising services supplied by foreign periodical publishers, met this day at 9:08 a.m. to give consideration to the bill.
Senator Marie-P. Poulin (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, this committee has held a number of meetings on Bill C-55. We have heard from a large number of stakeholders involved in this issue, including the magazine industry, the advertisers, the advertising services and American magazines. Specialists and academics have come before us to offer their views on the trade issues that surround the bill, and the committee has also heard from lawyers discussing the various legal implications.
[Translation]
Furthermore, last week, we had the chance to discuss with two groups; the first one was made up of business associations' representatives which maintain important trade relations with our neighbours from across the border. They said that they are worried about the impact of bill C-55. The second group, made up of individuals and representatives of cultural associations, reminded us of the importance of all Canadian cultural policies and the importance of this legislation.
[English]
This morning, we are pleased to have the minister here to answer questions that may have arisen as a result of what we have heard.
Welcome to our committee, Minister. This bill has received a lot of publishing attention, and I should like to invite you to answer the many questions that we still have.
Please proceed.
Hon. Sheila Copps, Minister of Canadian Heritage: Madam Chairman and honourable senators, during your thoughtful deliberations on Bill C-55, you have heard from a number of responsible Canadian industries regarding fair-minded concerns.
I wish to reiterate that when cabinet considered Canada's agenda following the WTO decision, we spent months looking at all of the possibilities, eventualities and considerations. No one is more concerned than I am when threats are made against our industries, especially when they are directed at steel workers' jobs in my riding. The Prime Minister and the cabinet are fully seized of all the relevant issues and factors.
I can also assure Canadians that the Prime Minister is a leader not only with a heart of gold but also with nerves of steel.
[Translation]
I would like to thank you, honorable senators, for having focused your attention on the basic principles at stake, namely the need to have Canadian content in magazines published for Canadians, the need to stop dumping of foreign products, the need to preserve Canadian culture and to promote its development and, finally, the need to defend Canadian values.
Bill C-55 must be considered in the historical perspective of our cultural policy. The progress made since the World Trade Organization rejected the former Canadian policy on magazines also has to be taken into consideration.
The reality is quite simple: one always needed national will to set the basis of a Canadian magazine industry. Governments of different political affiliations, throughout the years, have always had to adopt strong policies and actions to defend our culture.
In 1927, some foreign publications were prohibited because of the saturation of our markets. In 1931, Prime Minister Bennett's government levied a tax on the content of American magazines. In 1947, Prime Minister King's government banned the import of cheap magazines. In 1956, Prime Minister St. Laurent's government levied a tax on advertisements published in the Canadian edition of American magazines.
[English]
In 1965, the government of Prime Minister Pearson introduced the tariff code prohibiting foreign split-run magazines from entering Canada. In 1976, the government of Prime Minister Trudeau eliminated tax concessions for foreign-owned publications. In 1995, the House of Commons and the Senate passed Bill C-103 banning split-runs. For more than seven decades, every Canadian Prime Minister has proposed solutions to provide space for Canadian magazines in Canada.
That is the context and the historic base on which Bill C-55 is based.
As you can see, it is not Sheila Copps's pet project. It is a deeply considered action taken by the government of Prime Minister Jean Chrétien and supported by four of the five parties in the House of Commons.
From context to perspective: In June 1997, the WTO ruled against Canada. You remember the wailing, the moaning and the gnashing of teeth. It was all over. There was nothing we could do. It was either lose our magazine industry or violate Canada's international obligations.
[Translation]
But the prime Minister had a different vision of the reality. Like all Prime Ministers before him, he was determined to find the best solutions to today's problems. Cabinet took 13 months to examine all options and to evaluate the legal, trade and cultural implications of these options.
In July 1998, the Government of Canada announced that it would respect WTO rules, which means eliminating the tariff number and the excise tax, restructuring the publications distribution assistance program and harmonizing commercial postal rates.
The Government of Canada also announced its intention of introducing a new bill to regulate publicity services that are not subjected to international regulations.
[English]
Before I could barely get the words out of my mouth, United States trade representatives said Canada had no right to do any such thing, that it was worse than Canada's previous actions, and that they would never sit down to talk about magazines if we moved ahead with this legislation. There were commentators who said that the Chrétien government would never introduce this legislation and stories that it would never get beyond second reading in the House of Commons. There were also stories that it would never pass the House of Commons for fear of the United States. As this process continued -- that is, as the government took editorial heat at home and blasts from across the border -- the United States came to understand that Canada is serious about the principles of this bill.
[Translation]
They wanted to resume dialogue, they wanted to start informal discussions. To show them our goodwill, I suggested an amendment to the members of the House of Commons saying that this bill will become effective only when the Prime Minister and the Cabinet decide.
One would have believed that the government would never be able to introduce this bill to the Senate or that the Senate would have blocked the bill, but far from it.
[English]
Throughout this debate I have been far more circumspect than usual about commenting on my discussions; however, American officials themselves are now telling Canadians: "Look how far we have come since last July, when we said we would not give Canada anything on this issue."
[Translation]
Honorable senators, each step that makes us closer to royal sanction for bill C-55 advances Canada's cause which can be summarized in four points: Canadian content for magazines sold to Canadians, elimination of dumping of foreign products, preservation and promotion of Canadian culture and promotion of Canadian values.
[English]
Honourable senators, when I last appeared before this committee, I indicated that I would play no games. This is why I can assure you this morning that Bill C-55 is still the best proposal that we have for our Canadian magazines. That being said, we are still meeting with our American friends. If our friends south of the border believe they have a better proposal and we deem that it meets the tests that I have laid before you, we will analyze it. Should that be the case, and honourable senators allow me to appear before them again, I will come before this committee and present any such proposals myself for your consideration.
Senator Lynch-Staunton: I am still in a quandary. You said that, if you had proposals to bring, you would bring them to this committee. What would you expect the committee to do with them? You said that, if ongoing discussions lead to proposals that meet with your support, you would bring them here first. What would we do with them? What would be the purpose of that?
Ms Copps: You would have to analyze them to see if they were amendments that you could accept.
Senator Lynch-Staunton: If we are to undertake a clause-by-clause consideration of the bill today and give it third reading before we break, it cannot come back to us for amendment.
Ms Copps: The legislation itself is not enacted until the coming-into-force clause is approved, which gives you the opportunity to make amendments at any time.
Senator Lynch-Staunton: You mean that we will pass the bill, give it third reading -- as has the House of Commons -- and give it Royal Assent, and yet the government may decide not to proclaim it? The bill, in that form -- that is, after all those stages -- can then return to the Senate for amendments? I am not an expert on procedure, but I have never heard of that kind of procedure taking place.
Ms Copps: I am not suggesting your course of work to you, senator. That would be presumptuous of me.
Senator Lynch-Staunton: But you have, minister. You said that you would expect us to amend a bill that had already been given third reading and Royal Assent. I do not see how we can do that.
Senator Rompkey: On a point of order, Madam Chairman, I would think that the committee is the master of its own fate. It can deal with situations as they occur. Frankly, it is not for the minister to answer how the committee does its work. The line of questioning is with regard to how the committee operates. That is really a matter for the committee and not for the minister.
The Chairman: We can discuss that after the minister leaves.
Senator Lynch-Staunton: No. The minister has confirmed to us that ongoing discussions presently taking place between Canada and the United States may lead to proposals that may have the support of the government. That is very encouraging, but it has nothing to do with the committee's rules. How can we, within the parliamentary procedure, having passed a bill, having given Royal Assent to it, although not proclaiming it, how can we then bring that bill back in front of the Senate for amendment?
Senator Rompkey: We have not passed the bill. The question assumes that the bill has been passed. If the bill has not been passed, it is still available for amendment.
Senator Lynch-Staunton: Then, minister, would you prefer that we not pass the bill at this stage, in order that we might leave ourselves more clearly open to possible amendments based on proposals that, hopefully, you can bring to Parliament? Alternatively, would you encourage us to pass the bill, give it third reading and Royal Assent and then hope for the best?
I am asking you for guidance on how we should give you the flexibility to bring amendments to this bill, which appears to be what could take place.
Ms Copps: Senator, I cannot suggest to you what your agenda should be. I can suggest to you that, while your work is ongoing, it seems that the American impetus is stronger.
Senator Lynch-Staunton: Then you would prefer that we pass this bill this week, without amendment, as it is presently worded?
Ms Copps: I am not dictating your course of action. What I am suggesting to you is that while the work of the Senate has continued, it has been constructive in the dialogue that we have had with the Americans.
Senator Lynch-Staunton: Usually, sponsoring ministers come here to encourage us to act with haste, sometimes indecently so.
Ms Copps: Far be it from me to be accused of being slow.
Senator Lynch-Staunton: In answer to a question, when you first appeared before us, you indicated very strongly that you wanted this bill passed as fast as possible. Is that still your approach to this bill? If so, we will fully cooperate in having this bill go through this week. On the other hand, if you indicate to us that the discussions are at the stage where amendments may arise from them, then perhaps this bill should be left on the table to allow those amendments to be incorporated. I want to know your preference?
Ms Copps: I have indicated, senator, that while the discussion has been ongoing in the Senate it has focused the attention of the Americans on the issue and has underscored the fact that Canada is serious about this legislation. I believe it would be in keeping with that that your examination continue. I cannot dictate to you the terms of your agenda.
Senator Lynch-Staunton: I know. I am asking for guidance. The committee will decide for itself. If you prefer that our discussions continue, then you are indicating that you would just as soon not have the bill be given third reading this week.
Senator Rompkey: On a point of order, Madam Chairman, the question is asking the minister to dictate the work of this committee. The senator is asking if the work should go on or the work should stop. The work of the committee is up to the committee.
Senator Tkachuk: I think the senator is out of turn.
The Chairman: No, he is not.
Senator Rompkey: The other day you gave the Chair an agreement in writing that she was the Chair.
Senator Tkachuk: What is the point of order?
Senator Rompkey: The point of order is that the line of questioning is not in order, because it is asking the minister to dictate the work of the committee, which is the job of the committee.
Senator Lynch-Staunton: There is no point of order. When the minister came the first time, she urged us to pass this bill as quickly as possible. We did not take that as dictating to us what to do. I am now asking the minister if her wishes at that time are still as strongly felt today as they were then. We want guidance. We want to cooperate with the minister. We are not asking her to dictate to us. We want to cooperate. We are in favour of the principle of this bill. If there are changes to be brought to the bill to improve it, we will support them. However, the minister has not answered.
Senator Rompkey: She does not need to answer.
Senator Lynch-Staunton: Then I urge that we pass the bill as soon as possible.
The Chairman: Senator Lynch-Staunton, I believe the witness answered the question in the best way she could answer.
Senator Lynch-Staunton: Yes, I agree.
The Chairman: We have invited her here to ensure that we had the opportunity to ask all the questions that were raised with all the witnesses who came forward since we last met.
Ms Copps: To put it in perspective, when I came before the committee, there was a process called Bill C-55. I believed, and I still believe and the government believes, that Bill C-55 meets all of our international obligations and can achieve our shared objectives of protecting Canadian content.
At the beginning of this process, there was another discussion that began; that is the discussion that is taking place with the Americans precisely because the Americans think that they have a better mousetrap. As we have neared the end of this process in the Senate, the attention of the Americans on what constitutes a better mousetrap is becoming more focused. If that more intense focus were to yield the results that we all share and want, I would be happy to bring them back to you.
That being said, it has been my observation over the course of following this bill that it was not until the House of Commons and the Senate process was engaged that the Americans realized that we were serious.
Senator Lynch-Staunton: If the proposals are to be brought to us, will they be brought here in the form of amendments or in the form of a new bill?
Ms Copps: Amendments.
Senator Rompkey: Minister, we heard from two witnesses in particular whose evidence was quite striking.
Gordon Ritchie, who represented this country nobly in our discussions with the Americans, has said that this is the only alternative. He paraphrased Winston Churchill on democracy, by saying that it was not a good measure but it was better than all the rest.
Would you comment on that, please? Is this move really Canada's best option for dealing with what is essentially a cultural issue of protecting not simply our publishers but, in fact, our writers and creators?
To help set the context of your answer, I raise the testimony of the writers and creators who came before us, headed by June Callwood, who said that this was essential for their survival. I was struck by the spillover from magazines to other cultural instruments, or media, if you like -- that writers who write for magazines also write for television, radio and so on. Their testimony was that this measure is essential for their survival, and that without it they lack an avenue for their talents and their imagination.
Ms Copps: Sometimes when you are in politics you get so engaged in an issue that you cannot see the forest for the trees. In all the years that I have been in politics, from my perspective, and this is obviously subject to your analysis, I feel that this is a defining moment for this Senate and for this Parliament.
Senator Forrestall: That is a harsh word. What do you mean? That is a threat.
The Chairman: Please let the minister answer.
Senator Tkachuk: Point of order.
Senator Forrestall: I would ask the minister if she would care to define that.
The Chairman: Let us permit the minister to answer.
Ms Copps: It is a defining moment because, if you look at the history of Canada over the last 100 years, choices have been made in making this country that are not simply market choices. Sir John A. Macdonald chose to build a railway that started from the east and went to the west. It might have been quicker to go north-south, but he made a political choice that defined the history of this country.
In terms of the proposal that is before us, the international community is watching this bill very closely, not because of the nature of market share for the magazine industry in Canada but because they see it as a step on the eve of the 21st century in recognition that cultural protection is compatible with globalization. That is why it is a potentially defining moment.
In terms of the modalities, we continue to discuss with our American friends how it might be possible to make Bill C-55 a better bill. To date, we have not seen proposals that would make it a better bill and you are seized with the bill that is before you.
In its context, Bill C-55 is more than simply a magazine bill. It is a bill that says that, as we enter the year 2000, governments can still make choices that are not purely market-driven. That is critical for Canada's definition into the next century.
Senator Forrestall: I have still not heard an explanation of this being a defining moment for the Senate of Canada: You do it or you are finished. I did not particularly like the sound of that, and it surprised me coming from you, minister.
Ms Copps: That was not my intention, senator.
Senator Rompkey: I wanted to ask you, minister, to compare our policies with those of our neighbour. We have asked witnesses to compare this country's position with that of other countries. There are few countries in the world that are in the position in which we find ourselves, living next to the world's greatest superpower, which sees the entertainment and publishing industries as products for export -- and they do export them all over the world. We do not see it in those terms. We see our writers in cultural terms, as defining and speaking for Canada.
I would ask the minister to elaborate on that difference and the point of view of the two countries. Has that informed the discussions? If so, how? How has it led you to this bill that is before us today?
Ms Copps: André Cornellier spoke about this when he appeared before you. He said that, as the Americans see it, it is a business and a business should be on the table to be negotiated. The Canadians, the French and the Italians see this as a cultural thing. That spells out the difference. They see the world in their light and we see the world in our light. He was saying that the Americans are not after our culture; they are after our business.
In a sense, the underpinnings of successive government policies and their effect on magazines have given us an opportunity to create space for voices that would not otherwise be heard in a 300-million person market-place. We are the only country in the world that shares a common language with the Americans and a border that makes us an accessible domestic market for many of their products, and vice versa. That has been a good relationship for us in terms of commerce, et cetera. However, on the issue of culture, it is clear that we see the world through a different prism than do the Americans.
Senator Spivak: Minister Copps, on our side, we strongly support your efforts to ensure that Canada maintains its cultural sovereignty, and we understand the great efforts that you are making. Having said that as a premise, I am concerned with what form this preservation will take -- as either amendments or changes in the bill. I am concerned because of the issue of Canadian content. That is what is being reported in the press; rightly or wrongly, they are saying that that is the point on which the negotiations will turn.
In your letter to Mr. Ronald S. Lund you stated:
You also suggest a minimum Canadian content quota for all magazines, both foreign and domestic, circulating in Canada. Such a measure would unduly restrict consumer choice...
In other words, restrictions are not a good idea; yet the negotiations seem to be turning on minimum Canadian content.
The witnesses we have heard here, including Mr. Gordon Ritchie and others, have said that there are two basic problems with Canadian content. First, Canadian content is difficult to define. Second, if we have a minimum Canadian content, it will not take long before Time Warner and others will chip that quota down, again threatening retaliation and so forth, so that eventually we will have no leg to stand on.
I am strongly in favour of this bill and I worry about what might happen in the future, if we have of these amendments.
Would you clarify your position on the Canadian content issue in terms of the difficulty in defining it and the feeling that it might be a Trojan horse?
Ms Copps: If you return to the letter that was sent to Mr. Lund, the Association of Canadian Advertisers had suggested that we require that all magazines being imported into Canada have Canadian content. Of course that is completely unworkable. If Paris Match were required to have Canadian content before it came into Canada, we would be legitimately accused of building up walls around our country.
In the letter, I pointed out that, as a country, we want to have access to the magazines of the world in an open fashion, but at the same time we want to ensure, by whatever instrument is most effective, that we have some space for our own stories. You can see how we would be attacked if legislation such as the association proposed were to be implemented. You would have to kick out The Economist, Paris Match, and all other magazines that come in from other countries.
The Association of Canadian Advertisers is of the view that we should have national treatment for American magazines. However, they do not take the view that we should have national treatment for American advertisers.
If you look at the tendering rules of the Government of Canada, when it comes to advertising, we require that the only bidders for Canadian government advertising must be Canadian advertisers. That is completely legitimate and is sanctioned under the GATS, because we are a non-signatory to the services section of the GATT. However, if you took the proposal of the Association of Canadian Advertisers to its logical conclusion, then national treatment would extend not only to the magazine purveyors but also to the advertisers. Obviously that would not do. It would not be consistent to have rules that say that Canadian advertisers can only bid on Canadian government contracts but, at the same time, American magazine advertisers can have access to national treatment. That subject was not explored, but, frankly, when I did approach them on whether they felt they would seek national treatment for advertisers, they vehemently objected.
With respect to Canadian content, at the beginning of this process -- lo! those many months ago -- one of the proposals that we looked at seriously was a suggestion that we adopt a law deeming majority Canadian content. A number of other cultural industries have such a rule in place at the moment. For example, look at the Canadian content rules that govern the CRTC on radio licensing and television licensing; those rules have a fairly long history and they have worked to create a very healthy industry in this country. We felt at the time that, if we did adopt an approach that looked at majority Canadian content, that would mean that other players could come to the table, but precisely based on the principle of majority Canadian content.
At the beginning of the discussions, the Americans absolutely refused to look at Canadian content. However, they have come some way in terms of their perspective. I believe that if we are successful in enshrining the principle that Canadian content is a legitimate requirement in law, that important principle could stand us well in other areas of cultural discussion, such as television and radio. That framework, much as we have had it domestically, has never been accepted by the Americans.
Senator Spivak: Madam Minister, I also wish to explore the ownership question, and I know others may want to pursue that as well, but just to recapitulate what has been said, it is your view that the amendments will take shape around Canadian content and you have no fear about that and no qualms about the definition.
Ms Copps: Having examined about 18 iterations of Bill C-55, I do not take any iteration without caution.
Senator Callbeck: Madam Minister, my question relates to the concern expressed by American trade officials on this legislation. You touched on it a bit.
An article from a magazine in the States called Folio: The Magazine for Magazine Management, quoted Mr. Bob Crosland, managing director at AdMedia Partners, a media industry investment bank based in New York City. I want to read to you a couple of quotes concerning Bill C-55. The article reads:
Despite the hubbub, publishing analysts on this [U.S.] side of the border say the bill would have little effect on U.S. magazine interests. "There's not that much advertising up there," says Bob Crosland...
The articles goes on to say that the advertising value in Canada is probably $150 million. Mr. Crosland is quoted as saying that U.S. trade officials "can't even get publishers to come to Washington to testify on this." These are quotes by someone who is obviously very familiar with the U.S. publishers. By that, I take it there is very little concern by these people about Bill C-55.
Why do you feel that there is so much opposition from the Americans to Bill C-55? How do they justify talking in terms of retaliating in billions of dollars, when the value of this Canadian advertising is around $150 million?
Ms Copps: I would not even speculate on an answer to that question for the Americans. Perhaps you could ask them.
Senator Tkachuk: Madam Minister, you mentioned that there are discussions and perhaps negotiations going on with the Americans. You talked about the defining features of the bill -- Canadian content, the elimination of dumping, culture and values. Although dumping may be a little easier to define, there may be a difference among Canadians in defining Canadian content, culture and values. How would you define Canadian content? How would you know that a magazine has Canadian content or not so that it falls within the definition of Canadian content?
Ms Copps: We have outlined four principles, and I would hope that there are differing points of view. I do not think there is one, homogeneous Canadian culture. Many perspectives are given voice precisely through the number of magazines available. I suspect that when one picks up the Alberta Report one gets a slightly different perspective from when one reads the Downhomer. It is important that we keep those voices alive.
I do not think any government or politician is the arbiter of what constitutes "culture." The premise is that, in a country with a population of 30 million people, we should have access to the domestic vehicles we need to express the diversity of Canadian viewpoints. The fear is that, without instruments to secure advertising revenue, such vehicles could be overrun. Advertising revenue supplies the dollars to create Canadian content. That holds true in television, in magazines and in newspapers. No matter how good the reporters, if there is no advertising revenue to feed that content, there is no vehicle.
Senator Tkachuk: With respect to Canadian content, culture and values, a tremendous number of magazines with very little advertising in them depend on subscriptions. I am speaking of academic magazines, medical magazines, literary magazines and art magazines. Advertising is not there to support Canadian culture; advertising is there for business to use to market products. They could be advertising on television, on radio or in the newspapers. The only reason they advertise in a particular magazine is that that magazine gives people what they want; therefore, people read it.
Ms Copps: I do not disagree.
Senator Tkachuk: What magazines are threatened in particular? I do not take the view that closing the borders helps our culture. I think it hurts our culture. So what are we protecting, Madam Minister? What magazines are we protecting that are so important to our culture?
Ms Copps: We are not closing the border. The suggestion of the Association of Canadian Advertisers would have us close our border. In fact, right now in this country, we have the most open border in the world for magazines around the world.
Senator, I think you have answered your own question. You basically said that consumers will decide the success or failure of a magazine, and that is true. No government will dictate consumer taste.
The reason the Canadian Magazine Publishers Association and the business publishers have unanimously endorsed this approach is that for any magazine to survive, they need subscriptions that allow them to sell advertising at certain rates. Advertising keeps magazines afloat. A publisher cannot sell newspapers in this country, even though they may have the best writers in the world, unless they have advertising to sustain the investment in editorial content. That is the interrelationship. If a magazine is bad, a magazine will go down.
No one is suggesting that you keep afloat magazines that people do not wish to read. The consumer will decide whether or not they subscribe to a magazine. However, once that consumer subscribes to that magazine, you must have the investment in advertising dollars to fuel the editorial content. If you do not have the investment dollars in advertising, the subscription list alone will not allow a magazine to survive.
Senator Tkachuk: You continue to say that we have the right to read other people's magazines. I agree with that. We have many foreign publications.
However, advertising is a way for people to send messages on their own. In other words, if I have a particular point of view that I am trying to market in the marketplace, whether it is a political or a philosophical point of view or perhaps a point of view on a product, I should like the opportunity to sell my message or my product in the most efficient way. With this kind of legislation, you are preventing certain magazines in which I could sell my product or my ideas or my political message in a most efficient way from being sold in Canada. For example, let us consider computer products. We do not have a national computer magazine here.
Ms Copps: If you have a chance -- and this was not explored in the original discussion -- perhaps you could invite the advertisers back and ask them why they want national treatment for American magazines but not national treatment for American advertisers. What is good for the goose is good for the gander. If they make the point, as they have done consistently, that this is somehow an infringement of their rights, I would point out to them that the Canadian government decided to be a non-signatory to the services section of the GATT, and services include insurance, banking and advertising, amongst other areas.
If we followed the rationale of the Canadian Association of Advertisers and we offered a national treatment to purchasing of advertising, we would need to offer national treatment to Madison Avenue. We could not legally come before you to defend a policy where, for example, all advertising of the Canadian government must be done by the Canadian advertising companies, because that is inconsistent with national treatment for advertisers.
When I pointed that out in our discussions with the advertising association, they were vehement that they did not want national treatment for American advertisers. It seems to me that they are arguing two sides of the same coin. Earlier someone spoke about Gordon Ritchie's presentation. We premised our legislation on a salient fact that Canada is a non-signatory to national treatment in advertising services. We are respecting every single international obligation precisely because we are not a signatory to the services section of the GATT. We made a decision internationally not to sign on services because we have a Canadian regime for banks. You might argue that we should set that aside, but the advertisers are asking for national treatment for American magazines but not national treatment for American advertisers. That is not a sustainable or logical policy.
Senator Tkachuk: I am not here to defend the advertisers or to be an advocate for the advertisers. I am here to talk about the opportunity for businesses, and Canadians, to have a wide variety of choices, which our present marketplace is not providing, to market ideas and products, political discussion, or anything else, by magazines that do not presently exist in Canada. You seem to be concerned that if those magazines did exist and were foreign-owned, they would somehow destroy the Canadian magazine industry. I do not buy that. I do not agree with it. There has been no evidence to show that that would happen.
Ms Copps: Perhaps you would wish to analyze what happens in other countries similar in size to Canada that have no national instruments to ensure the survival of their magazines.
Senator Tkachuk: Which countries are you referring to? Help me out.
Ms Copps: Austria is in a similar position with Germany in terms of sharing a common language, a common border and a common situation. The publishing industry in Austria would very much like to follow the Canadian model, because the Austrian publishing industry at the moment is de minimis.
Senator Tkachuk: Are they not part of the European Union there? Have they not already bought that argument? They have already got rid of that argument, have they not?
Ms Copps: Austria is part of the European Union, but Austria's publishing industry is in a similar situation vis-à-vis the sharing of the German language and culture.
Senator Joyal: You mentioned in your opening remarks that the Prime Minister has steel nerves. I must commend you. You, too, have steel nerves. You have been able to sustain the public debate on this over a prolonged period. You have not lost your cool and you have maintained your determination to foster public attention on the scope of the bill. I commend you on that.
Having said that, can you tell us when the discussions started with the Americans?
Ms Copps: We have had nine meetings. The first meeting took place at the end of February.
Senator Joyal: You said that you have been circumspect in commenting on those negotiations. Are you bound in some kind of agreement with your American counterparts not to disclose the contents of the negotiations?
Ms Copps: When you are in discussion, it is important that before any proposals have been agreed upon, discussions continue to remain internal.
Senator Joyal: In spite of the retaliation or the "threat" that has been proffered by the Americans, to date you have been able to maintain a large base of support in Canadian public opinion. Do you feel that perhaps you will need to make public the "counter proposals" that the Americans have been putting on the table, so that the Canadian public will be in a position to judge who is being unreasonable in those negotiations on the objectives that Canada is pursuing?
Ms Copps: I have undertaken to return to this committee and to the Parliament of Canada for any thorough examination of any agreement that might be reached in the future. If such an agreement were to be reached, obviously the approbation of Parliament would be paramount. That would give people the opportunity, then, to examine the depth of what it was that might be agreed upon.
Senator Joyal: You understand that there will be a point at which either there is a deal or there is no deal. That cannot last for a year or so. You might expect that within a reasonable period of time you will have to draw a line and come to a conclusion, that it is not only procrastinating but also there is a good faith will to achieve some kind of compromise. In your mind, what are the elements that will bring you to that conclusion?
Ms Copps: I believe the determination of the Parliament of Canada and the determination of you honourable senators. That is why I made the comment earlier to which Senator Forrestall took some exception. However, I meant my comments in a very sincere way. Honourable senators' thoughtful examination of this legislation has very much helped in focusing the discussion.
Up until the point that Bill C-55 actually passed the House of Commons with majority support and moved through the Senate, the Americans were of the view that this was just pie in the sky. They now understand that we are serious. I agree that at some point in the near future it will be important either to conclude an agreement with the Americans and return to you, or to agree to disagree.
Senator Joyal: You have not set a specific date. Normally, as you know, the Americans like discussions that are productive and efficient. When their interests are at stake, they have in mind a certain capacity to be able to report to their own government that serious and honest effort has been made to reach a conclusion. Then the dossier is passed on to the executive of the government. Did you feel in those discussions that the Americans want to achieve a conclusion by a set date or do you think the discussions will just go on as long as the Americans and your officers want them to? Where is the breaking line on that?
Ms Copps: The Americans have shown a flexibility that they have not previously shown. As that is a new development, it is important to continue talking. However, I do not feel these negotiations can continue ad infinitum.
Senator Joyal: Minister, you mentioned that your first objective, Canadian content, has been well defined. You mentioned the threshold of 60 per cent.
On the second element, the elimination of dumping, have you considered exempting certain foreign magazines that are addressed to very targeted audiences with very limited circulation? In that way, the Charter discussions that took place on a total ban of foreign magazines would be alleviated by the kind of exceptions that would make the test easier if the proposed legislation is passed and then contested in court.
Ms Copps: We have done a significant amount of work on a number of models that predated the arrival of Bill C-55 into the House. We have done a tremendous amount of work in the area of Canadian content as an element for other magazines to enter into the marketplace. That work indicates that it would actually have the positive effect of increasing the content of some Canadian magazines, as well as requiring a blossoming of Canadian content in other magazines that might be coming into Canada for a targeted run. Some numbers were crunched on that in terms of what would constitute a viable benchmark that would encourage Canadian content and achieve our objectives. There is no fixed number there, but certainly a majority is crucial.
We also looked at exemption proposals in the beginning. If you were to introduce any exemption proposals, the challenge would be to ensure that the exemption proposals were not so large that they effectively negated the legislation. We did a tremendous amount of work on that subject prior to agreeing that Bill C-55 was the best vehicle.
The industry is probably in the best position to give you an analysis as to what constitutes a viable exemption or de minimis.
Senator Kinsella: Some of us have been very direct in our support of the principle of this bill. We have also made every effort to be circumspect as we dealt with this, because we did not wish to disarm you as minister in dealing with our American friends.
In our study, we had some questions as to whether the bill would be consistent with the standard provided by the Charter of Rights and Freedoms. We canvassed that issue and heard from experts. My conclusion is that opinion is divided on that issue.
This morning you stated that Bill C-55 is more than a magazine bill. That is why a number of us were impressed when we heard witnesses speak about the need for clarity on the purpose and the objective of the bill. If the bill were to be opened up for government-sponsored amendments in light of any agreement that might come forward, would you support a purpose clause that would clarify the objective of the proposed legislation? That could be by way of a preamble, for example.
Ms Copps: Honourable senators, having lived through the Meech Lake Accord, I will do my level best to avoid preamble. If there were to be an agreement that would require an amendment, I should like to keep the amendments as tight and defined as possible so that we focus the discussion on the issues. A preamble has very laudable intentions but can sometimes place editorial artistry ahead of substance.
Senator Grafstein: I am glad the minister responded in that way. We would spend more time on preambles than we would on the substance of bills. That is one practice of our American confreres that we should not follow. That issue has been raised a number of times in the Senate. Preambles do not clarify; rather, they tend to obfuscate.
Senator Lynch-Staunton: Just like the preambles to your questions.
Senator Grafstein: Exactly.
Minister, I want to ask you a general question about government policy in cultural matters. From your perspective there are two visions. You say that cultural protection must match or be consonant with globalization. We have a goal in Canada to assist in globalization and you used the words "cultural protection." Can we not characterize this somewhat differently for our American colleagues? When we talk about cultural protection, their eyes glaze over. They just do not quite understand.
Could we not characterize American magazines as a form of spiritual dumping, and say that the object in Canada is to have a level playing field? The object is to allow Canadian writers and publishers fair access to our own market-place. The Canadians are being crowded out by American competitors whose costs have been fully amortized in their market-place. They come here really cost-free to compete unfairly in the Canadian market-place. Is that not a better way of putting it, or an alternative way of putting it?
Ms Copps: That is a way that they understand. However, this particular proposed legislation has captured the attention of the international community precisely because there is a larger debate. The larger debate is about whether globalization is compatible with cultural diversity. That will be the defining debate.
As I said, sometimes you get so embroiled in something that you cannot see the forests for the trees. Marshall McLuhan, a Canadian, saw what the future would hold for us. Political decisions, for example, are now transmitted instantaneously. Had we had satellites at the time of the Vietnam War, that war would have had a completely different outcome.
I believe that thoughtful governments and thoughtful people can find instruments to ensure that cultural diversity is part of a global fabric. I do not think that current international instruments reflect on that point.
To take it to a second step, I think the culture ministers' network has struck a chord because, while we have international organizations to define all kinds of trading relationships, until we held that meeting in Ottawa last year, there had never been an international meeting of culture ministers. I find that amazing. Of course, 30 years ago it was not necessary because international relationships were more about trading and goods. Today, however, our children are living in a world community that is intertwined, and there is a need for thoughtful international instruments for cultural protection that are not excuses for companies simply to hide behind because they do not want to meet the international competitive rules.
Thoughtful governments and thought thoughtful people can find those paths. This is one such path and that may be why the response to the legislation has been out of proportion to the actual monetary issues at stake with the Americans.
Senator Grafstein: Senator Tkachuk spoke about being fair to advertisers and about the lack of access. That argument -- and the argument that I have heard from the Americans -- is the same one that was made by the Americans some 15 or 20 years ago when we changed the FM regulations to increase Canadian content. At that time, Canadian artists were deprived of playing time over Canadian airwaves. There were disastrous comments from the American music publishers, and so on, but the end result of increasing Canadian content was access to new stars. Céline Dion was a godchild of the Canadian-content regulations, as were Bryan Adams and a number of other stars. It was a lost opportunity, and we were not aware of it.
Having said that, this cultural war that we have had with the United States -- which is being fought by a small minority in the United States -- continues to be waged. I thought it was finished when we dealt with television regulations, the Time magazine issue and Newsweek. However, it seems never to be finished. It seems that government policy has led us into this somewhat ambivalent position; we thought we had solved this problem again with a cultural exemption under FTA and NAFTA. The Americans agreed to the cultural exemption. That involved a huge battle, but all governments agreed to those exemptions. Yet the Americans have chosen their weapon of choice, the WTO, as opposed to NAFTA. I believe that NAFTA would not have allowed this issue to bubble forward, so the WTO was the American's weapon of choice.
Having said that, we are now engaged in discussions regarding transatlantic free trade and free trade of the Americas. We are also about to go back to the WTO for another round. Will it be the Canadian government's position to move this forward to the WTO as a policy element to see if we can end up with an international debate that might resolve this for the next century? If that is not the case, 50 years from today this will be other element and parliamentarians will be debating this same battle again.
How do we get this issue off the table, in a fair way that does not bring it back for every generation? How do we do that?
Ms Copps: The road map to which you are pointing for the WTO is part of what the culture ministers will be looking at in Mohawk in September. I have been working closely with my colleague, Sergio Marchi, to ensure that at the next round of WTO negotiations there is an instrument that can engage this debate.
I met only a week ago with my counterpart, the French minister responsible for culture, who is organizing an important meeting in Paris in June to bring together international experts on this issue to see how we might be able to frame an approach that would meet the test of our international obligations and at the same time be respectful of cultural diversity and, in certain instances, cultural protection.
I think the debate has been launched. This bill has been the focal point of that debate because many countries are now emerging and creating frameworks for their own cultural support. A number of Eastern bloc countries are just coming out. I had a meeting yesterday with the minister responsible for culture in of Slovakia. Many Eastern bloc countries are looking for governance instruments they can create that will permit the épanouissement culturel.
They are looking to Canada because we have been uncannily successful. I did not mention specifically the work of the Conservatives on the cultural exemption in the NAFTA. Successive governments have taken that view. It is reflective of a broad consensus in Canada and four out of five political parties have supported this legislation because it is the right thing to do. That being said, the debate will continue, but I think it is now engaged at an international level. That is why the international community is watching the outcome of this debate very closely.
The Chairman: We appreciate your opening remarks and your openness this morning. We heard your suggestion to return to the committee. Good look with your future work.
Senator Rompkey: Madam Chairman, in view of the discussion that we have had this morning, and in view of the testimony of the minister, it is obvious that what Senator Grafstein has described as a cultural war is being waged on a number of fronts. There is a battle of words here, a discussion, because I do not think there is a great deal of difference in positions. However, there is a battle going on here. There are also other battles waged by other Canadians in other fora.
It seems to me that we would be acting responsibly if we took advantage of the fact that other Canadians are battling elsewhere and continued our deliberations. I would move, therefore, Madam Chairman, that Minister Marchi and his officials be asked to appear before us to bring us up-to-date on battles in which they may have been engaged in this cultural war.
Before taking a final decision, we should have all the information that is available to us. In that context, I would urge that we invite Minister Marchi and his officials to attend our committee.
The Chairman: We have a motion on the floor by Senator Rompkey. Comments on the motion?
Senator Lynch-Staunton: That is an excellent idea, because we have missed the testimony of the trade people. I assume you want to do that as soon as possible, this afternoon or tomorrow morning, for instance, so that we can proceed with clause-by-clause consideration of the bill.
Senator Rompkey: Ask him to come now.
Senator Lynch-Staunton: Let us not get flippant. I presumed all along that we would do the bill clause by clause today, and I assume that that is still the goal.
I assume that Senator Rompkey has been in touch with Minister Marchi and knows of his availability and that of his officials.
Senator Rompkey: I have not been in touch with him or with his officials. I simply made the suggestion and the motion. I do not believe we should proceed to clause-by-clause consideration of the bill until we have heard from Minister Marchi and his officials. I suggest that the clerk contact him in an effort to have him appear before our committee as soon as possible.
The Chairman: As we have done with all other witnesses, we can take for granted that the clerk will follow up. I believe we have consent.
Senator Lynch-Staunton: We have not yet approved the motion, Madam Chair. If we are to change the rules, will another witness be sprung on us after we hear from Minister Marchi, thus delaying the bill even further? We will not be part of delaying this bill, if that is all the other side is up to. There may be good reason to delay the bill. However, instead of playing games, at least be up front and say that the minister believes there may be amendments and that you think it is a good idea to suspend studying the bill until those amendments come to us.
We want this bill to go through. If colleagues opposite have good reason to feel amendments would improve the bill, just say so.
Senator Kinsella: Madam Chair, I have a point of order. We must resolve this issue in committee. If there is agreement to have Minister Marchi testify, we must set the agenda. Once that is done, we must proceed to clause-by-clause consideration of the bill.
We cannot veer from the agenda that has been adopted and acted upon today. In other words, the agenda before us, which has been commenced, may only be veered from with unanimous consent. We will not withhold unanimous consent if we have an undertaking that Minister Marchi will appear before the committee as soon as possible, whether it be Thursday, later today or tomorrow. On that agenda, item 1 would be to hear from Minister Marchi, and item 2 would be clause-by-clause consideration of the bill.
Senator Grafstein: Madam Chair, I am not a member of this committee; I am here as a surrogate for some of these meetings. Having said that, I am interested in this topic. I assume that is why it was suggested that I become a member of the committee to substitute for another senator. I have been engaged in this issue for about 30 years.
What we have before the committee is a moving target. We now hear from the minister that ongoing and active discussions might have an impact on the bill. At the same time, we have not heard from the minister who appears to be in charge of the negotiations, which is Mr. Marchi. It strikes me that we should hear Mr. Marchi as quickly as possible and review the issues as best we can so that we can get a grip on where those negotiations are going.
I am sensitive to what senators opposite are saying. Where are we on this issue and what is the appropriate position to take? At this moment, I do not think we have enough facts. I should like to hear from Minister Marchi, and then I think it would be appropriate to hear motions.
Senator Spivak: Were you speaking to the point of order or to the motion?
Senator Grafstein: I was speaking to the motion.
Senator Rompkey: Bearing in mind what Senator Grafstein has said, this committee has a steering committee, and I would prefer to leave the agenda in the hands of the steering committee. If we adopt this motion today, the steering committee should meet to consider the further activity of the committee and report back to the main committee. That is the normal job of the steering committee.
The Chairman: For your information, the deputy chairman of this committee, Senator Forrestall, and I spoke before the meeting this morning. He agreed that we might have to meet with trade officials at a later date. We did agree that we would change the agenda and that we would review it after the minister's presentation.
Senator Spivak: I have no objections to meeting with any witnesses. However, it is only fair to understand where this process is going and whether we can have a cut-off date at some time. As well, there must be some transparency in terms of what those amendments might be. I asked the minister, but she was not very forthcoming about where we are going. In other words, I think we should know what the other side knows.
The Chairman: Honourable senators, are there any other comments on the motion itself?
Senator Lynch-Staunton: There is a point of order.
Senator Tkachuk: I am confused. The government wants us to pass this bill. They believe it is a wonderful bill and that it will protect the Canadian magazine industry. Meanwhile, the principals in this debate are having discussions, not negotiations, from what both the Leader of the Government in the Senate and the minister have said. It now appears as if senators opposite want us to delay the agenda because of ongoing discussions. Yet, we do not even know what the negotiations are all about. We do not have a clue about what the government is trying to negotiate because no one is talking about it. That is not a good way to do business.
I agree with Senator Lynch-Staunton that we have an agenda and that we should proceed with that agenda.
The honourable minister, if I am not wrong, had an opportunity to appear before us and declined that opportunity. I think we should go ahead, move the bill and amend it at third reading.
The Chairman: With respect to the point of order on veering from our agenda, we do not require unanimous consent, but we do require an agreement between the chairman and the deputy chairman. That was reached this morning.
Senator Lynch-Staunton: I think we owe it to the House of Commons to proceed with this bill. Otherwise, members of that House will realize that they were led down the garden path. The government knew all along that amendments were to come. Instead of showing respect to members of the other place and waiting for the entire bill to proceed, the government deliberately sent this bill through the House, knowing full well that it would be subjected to significant amendments.
Senator Tkachuk: Much like Bill C-49.
Senator Lynch-Staunton: That is demeaning to members of the House of Commons. By doing this, we are a party to that.
Senator Grafstein: That is not fair.
Senator Lynch-Staunton: What do you mean? It is fair.
The Chairman: Colleagues, we have a motion on the floor, and I will call for a vote.
Senator Kinsella: I made a point of order, and I have the right to speak last on that point of order.
The Chairman: I have already ruled on your point of order, senator.
Senator Kinsella: What was your reasoning?
The Chairman: My reasoning was that the deputy chairman and I had a meeting this morning. We agreed that we would hear the witnesses from International Trade who had asked to be heard and were not able to be heard because of their agenda.
Senator Kinsella: If that is the reasoning, then we challenge the ruling of the Chair. I am not convinced that the agenda, as published and circulated and under which the business of this committee has been conducted for last two hours, does not establish in a prima facie manner that this is the agenda. Two members of this committee do not constitute a full meeting of the steering committee, notwithstanding the delegation of the authority the committee gives to the steering committee.
I was about to withdraw my point of order because I thought we had reached an understanding that the minister's office would be contacted forthwith. There was no indication of any delay by my colleagues Senator Rompkey and Senator Grafstein. I understood that we would hear from the minister later this week or as soon as possible. I thought we had agreed that clause-by-clause consideration of the bill would be added to that agenda. It seems to me that we have a consensus on those issues.
On the basis of that understanding, I withdraw my point of order so that I do not have to challenge the ruling of the Chair. That is the way we should conduct our business.
The Chairman: Do you wish to challenge the ruling, Senator Kinsella?
Senator Kinsella: No.
The Chairman: Honourable senators, Senator Rompkey has moved that:
The Minister for International Trade and his officials be invited to appear before the committee on all events relative to Bill C-55.
Is that your motion, Senator Rompkey?
Senator Rompkey: Yes, it is.
I wish to commend Senator Kinsella for his attitude. Fundamentally, there is no difference in the overall objectives on either side of this table today.
The Chairman: Honourable senators, since the beginning of our hearings, Bill C-55 has generated a great deal of public debate. We all came to this table with an open mind, and we have heard from many witnesses. At the request of Senator Forrestall, we added a list of witnesses so that we could hear both sides of the issue.
As Senators Kinsella and Rompkey are saying, we have not yet heard from International Trade officials. I do have a letter from the deputy minister excusing them, saying that they have been very busy but that they would like to be heard. I think it would only be fair for this committee to hear from them as soon as possible. Unfortunately, since we do not have a direct line to the minister's office, we will have to be sure that the clerk follows up right after this meeting.
Senator Lynch-Staunton: Does "as soon as possible" mean before prorogation or after?
The Chairman: I am afraid that I do not have the answer to your question.
Senator Lynch-Staunton: I think I have it.
Senator Forrestall: We will presumably take a recess the day after tomorrow for two weeks. The heat of the summer is coming, and the end of the first week in June is not far away. That is very likely the eve of the summer adjournment. Even if we have no prorogation until September or October, the fact of the matter is that the Senate and the chamber will not sit, I suspect, for a full day before that act occurs, in which case we are back to square one on the planning board without a piece of legislation with which to deal. That frustrates our belief that some measures should be in place to protect that piece of our culture.
We have no assurances whatsoever that Minister Marchi will attend, and I am not all that sure that we want simply to question his officials. What assurances are there that the matter will be dealt with before prorogation, a summer adjournment or whatever deadline we want to pick?
Senator Lynch-Staunton: We just buried the bill.
Senator Forrestall: I want an answer.
Senator Lynch-Staunton: There is none.
The Chairman: I will ask the clerk to give us an answer, and I will discuss this with Senator Forrestall.
Will those senators in favour of the motion please raise their hands.
Will those senators opposed to the motion please raise their hands.
I declare the motion carried.
The committee adjourned.