1. CANADIANJOURNAL OF COMMUNICATION, VOL. 13,NO. 2
THE REGULATION OF CROSS-MEDIA OWNERSHIP:
THE LIFE AND SHORT TIMES OF PC0 2294
by
Allan Bartley
Acase study of cross-mcdia owncrship which argues that the 1382Cabinct
orderdirecting theCRTC to denybroadcasting liccnsesloncwspaperowners
was symbolicin origin,contentand administration.
Une Ctudc sur la propribtb des mtdias avanceque l'ordre dc 1982du cabinet
obligeantle CRTC A rcfuser dcs permis de radio diffusion aux propriblaires
dejournaux Ctait en fait symboliquequant A son originc,son contcnu ct son
administration.
Introduction
The fedcral Cabinct issued a policy direction to the Canadian Radio-tclcvision
andTclccommunicationsCommission (CRTC)onJuly 29,1982.Itrequired theCRTC
torefuse to issueorrcncwbroadcastinglicencesto thcproprietors of dailyncwspapcrs
unless this would "adversely aflcct service to the public or crcate exceptional or
u~easonablehardshipto the applicantand the levelof cxistingcompetition in the area
sewcd or tobe sewed..."(PC0 1982-2294).Thcdircction,Privy CouncilOrdcr2294,
was dcscribcd as a measure:
to cnsurcthat, with certain cxccptions,enterprisesengaged in thepublication
of daily newspapcrs shall be prohibited from owning or controlling
broadcasting undertakings in the same market area for the general purpose
of fostering indcpendcnt, competitive and diverse sources of news and
viewpoints within Canada (Explanatorynote, PC0 2294).
Thedirection,issuedundertheauthorityof TheBroadcasringAct, came 11months
after the Royal Commission on Newspapers recommended measures to regulate thc
joint ownership of newspapers and broadcasting undcrlakings. The 1970 Spccial
Senate Committee on the Mass Media had urged action to stem cross-mcdia
owncrship.In the 12interveningyears, therewas no governmentinitiativeto develop
a formalpolicy oncross-media ownership.PC02294 wasrevokedby Cabinctwithout
explanation on May 30. 1985 (PC0 1985-1735).The silence spoke volumes about
effortsto regulate cross ownership in the Canadian media.
The political and bureaucratic origins of PC0 2294 were central to its life and
shorttimes.Itwasa symbolicmeasurenevermeanttodisturbexistingcross-ownership
situations. Rather, it was seen by i& framers as a deterrent to futureproblems while
responding to a temporarily prominent issue. Conceived of political necessity and

2. 46 The Regulation of Cross Media Ownership/Allan Bartley
rooted in administrative precedent, PC0 2294 was incapable of fulfilling the role
Cabinctclaimedfor it at proclamation. The directionwas dcstined to a brief existence
whose dcmisc signalled a rcturn to business as usual in the Canadian media
environment.
The following casestudy of thc direction's originsand application supportssuch
conclusions. Part Onc looks at thc rccord of cross-mcdiaownership rcgulation prior
to PC0 2294. Pan Two examincs the roots of the policy direction with particular
rcfercncc to its executive-burcaucralic formulation. Part Three analyzes the
implcmcntationstagc.The final section summarizes the findingsabout the natureand
effecdvencssof thc cross-owncrshippolicy direction.
I Cross-Media Ownership Regulation, 1968-1982.
The Canadian Radio and Tclcvision Commission was creatcd in 1968 with a
mandate to "safeguard, enrich and svengthcn the cultural, political. social and
economic fabricof Canada" (TheBroudcasting Act, k c . 3, b). One objective was to
cnsurc that "theprogrammingprovided by the Canadian broadcastingsystem should
be varicd andcomprehcnsivcand should providcreasonable,balancedopportunityfor
the expressionof differingvicws on mattcrs of public conccm..."(Sec. 3, d). C~binct
wasempoweredto issuedirectionsto Ihccommission on whocould hold broadcasting
. licences (Sec. 27, 1).The wide-rangingauthorityof thc CRTC promoted its statusas
a powerful policy actor.
Thc policy dirccdon cnjoycd growing favour as a governing instrument during
the 1970s to countcr a pcrccivcd erosion of political conlrol of rcgulatory agcncics
(Janisch, 1987: 11; Kcnniff, 1979: 68). The 1979 Royal Commission on Financial
Managcmcnt and Accoun~abilitycncouragcd iu use. Before a policy dircction was
issued, the government should refer thc mallcr to h e affected agcncy for public
hearings (1979: 318).The governmentwould be free to acccptor reject the agency's
advice.Thenextyear,aHouseof CommonsSpccialCommiltceonRegulatoryReform
urged that Cabinet be authorized to issuc binding policy directionsto the CRTC and
other federal regulatory agencies(1980: 1003).
A review of the advantages and disadvantages of policy directions -- for both
agcncy and Cabinet -- suggests several political and adminislntive implications
(Roman, 1981, 1985;Janisch. 1979; Vandcrvort, 1979: 129; Harde. 1979: 127-133).
Thc pcrccived advantage of increased control by Cabinet is two-edged. An agency
faced with a difficultdecision might scck a policy direction from Cabinet to absolve
itself of responsibility form cspcciallyhardjudgment. Adirectivepowerconcentrates
lobbying on the Cabinet although "thc power to influence the Governor in Council is
by no mcans equally distributed throughout the population" (Roman, 1981: 153).By
dcfiningdirectionstooprcciscly,Cabinctcould beseentobcdecidingindividualcases,
thereby destroying an agency's credibility while attracting criticism for
politically-motivated rcgula~ion(Johnston, 1980: 91). A dircction framed in broad

3. CANADIANJOURNAL OF COMMUNICATION, VOL. 13,NO. 2 47
termscould be open to conflictinginterpretations.Regulatorydecisionsmadesubject
to policy directionscould be challenged before the courts or appealed to Cabinet on
the grounds the direction had been misinterpreted by the agency. A vague direction
would be especially vulnerable.Its very existence would suggest "sometension, lack
of trust or uncertainty"betwken the governmentand the agency (Roman, 1981: 157).
The Cabinet's directivepower under TheBroadcasfingAct was used three times
prior to 1982-- to reserve cable channelsforprovincial educational television, to bar
non-Canadians from holding broadcasting licences and to restrict licences held by
provincialagencies to educational broadcastingoutlets (Coniolidated Regulationsof
Canada, 1978).In 1978,theLiberal governmentproposedanew Telecommunications
Act --never approved --which would have allowed Cabinet to issue such directions
to the CRTC as wcreconsidered necessary to achievethe policy objectivesof theact
(Bill C-16,1978).
Research for the Royal Commission on Newspapers described the extent of
newspaper and broadcasting cross ownership in 1981 (Oliphant and Whitc, 1981:
45-49). Thc Irvingfamily (of which more later)operated radio and televisionstations
in the sameNew Bmnswick communitieswhere it alsopublished all of theprovince's
English-languagc daily newspapers. The Blackburn family owned the daily
newspapcr, two radio and one television station in London. Ont.. as well as two ndio
and one TV station in nearby Wingham. Southam Inc. and Selkirk Communications
Ltd. (with the former holding 30percentof the voting sharesof the latter)overlapped
newspaper and broadcasting markets in fiveareas --Vancouver, Calgary, Edmonton,
Hamilton and Prince George. Power Corp. of Montreal through its control of Gesca
Ltd. published four daily newspapers and also held 10radio and TV licences.These
operations shared markets in only onecommunity--Granby,Quc. Armadale Co. Ltd.
ownedthedailynewspaperand the leadingAMndio stationin Regina.TheBurgoyne
family owned the daily newspaper in St. Catharincs, Ont. and a local radio station.
Western Dominion InvestmentsCo. Ltd. heldbroadcastingstationsinToronto.Ottawa
and Montreal although the newspaperspublishcd by an operating division. Sterling
Newspapers, wcre located in smaller, distant centres. Thomson Newspapers held
minor interestsin some small OntariocableTV outlets.
The CRTC's approach 10 regulating cross-mediaholdings in broadcasting took
the form of overseeing the transfer of shares,licencesand other means of ownership
and control. The commission said it "considered the regulation of ownership as an
essentialelementin itsregulationandsupervisionof theCanadianbroadcastingsystem
with a view to implementing the objectives of the Broadcasting Act..."(Notice of
Public Hearing,Feb. 9,1979). From 1968-1975,the CRTC dealt with applicationsto
transfer ownership or control of 515 radio, television or cable (CATV) operations
(Babe, 1976:569-71). Thecommissionapproved423 anddenied 92. with nineof the
former conditional on the new licence holder divesting or reducing holdings in
broadcastingpropertydueu,concernsoverCATVand televisioncross-ownership.Of

4. 48 The Regulation of Cross Media Ownership/Allan Bartley
the denials,41 cited an unacceptable concentration of control and local ownership.
Two others were denied because they would have resulted in newspapersconvolling
the operations. "The Commission considers that the ownership and control of
broadcasting undertakings should be separate from the ownership and control of
newspapers except in special circumstances..."the commission wrote in denying a
1974 transfer which would have given The Toronto Star convol of a small cable
company (Decision74-44). It did not say what the "specialcircumstances"were.
The commission recognized that The Broadcasting Act did not give specific
guidance with respect to ownership and control but drew its authority from the
principlesandobjectivesof Section3. Ownershipissueswereevaluated "on themerits
of each individualcase, taking intoaccount the particular factual circumstances. This
approach has provided the Commission with the necessary flexibility to assess each
applicationin the lightof theobjectivesandrcquiremcntsof theAct"(Noticeof Public
Hearing. Feb. 9. 1979).The specific question of newspaper control or ownership of
broadcast undertakings was. the Commissioncontinued, of particularconcern,
in view of the potential reduction in indcpcndcnt and separate editorial
judgments that this could involve. This would be of grcatcrconcern if there
werejoint ownershiporbroadcastingand newspapersin the same market A
further concern with respect to cross-ownership of cable television
undertakingsand newspapers has becn that suchcross-ownershippotentially
could establish for the newspaper enterprise involved an undue advantage
over other print mcdia in the same community.
On the evidence of these statements, the CRTC was clcarly inclined to discourage
cross ownershipof all kinds but the rules --if any -- were vague.
A critical pcriod was reachcd in the late 1970s. An October 1979 CRTC ruling
- dcnicdpermission to vansfcr sharesin MultipleAccessLtd., which conlrollcdseveral
broadcastingstations,to Baton Broadcasting,anotherlarge chain.The transferwould
haveput CFTO-TVin Toronto and CFCF-TVin hlonlrcal,the largestprivate stations
in their respective markets,in the samecorporatehands. Although theapplicationwas
dcnicd on the basis of concentrated ownership, an anonymous dissenting opinion
argued the transfer should have been allowcd. The split decision demonstrated
disagreerncnt within the commission on ownership issues. On Feb. 9, 1979, the
commission announced hearings would be held the following May on the
cross-ownership issue. "The objective of such a review would be to determine
whether... there is justification for altering the Commission's position that
cross-ownership should not be permitted except in special circumstances." Three
months latcr,the CRTCsaid itwascancellingthe hearings. Although25 writtenbriefs
were received (most from broadcasters and newspapcr publishers),only eight parties
said they wished to appear. Therewere six requeststo postpne the hearings,with fie
rcrnainingbriefs urging the commission to veat cross-ownershipapplications"on be

5. CANADIANJOURNALOF COMMUNICATION,VOL.13, NO. 2 49
meritsofcachindividualcasc,fakingintoaccount theparticularfactualcircumstances
..."(Notice of Public Hcaring. May 10, 1979). The commission said it would think
aboutit.
The CRTC was not the only government agcncy with a mandate to act on
ownershipissues,butby the late 1970seventsmadeitappearso.In 1976,theSuprcmc
Court of Canada upheld a lower court ruling that K.C. Irving Ltd., by owning all
English-languagedaily newspapers in New Brunswick, had not violated the merger
and monopoly provisions of the venerable Combines Investigation Act, a criminal
statute with a poor rccord in cases involving newspapers (Henry, 1970). The Irving
family also held broadcasting licencesfor oneradio and two television stations,facts
which did not entcr the case. The only provision of the legislation upheld involved
sections dealing with conspiracy to create a combine. The case had "a devastating
impact on Canadiancombincs law and policy", gutting the legislationas it applied to
the mcdia (Green, 1981:426).
The conscquenccsof the Irvingjudgment wcreof more than academicinterest to
other newspapcr chains conccmcd about the impact of anti-combines lcgislation.
Southam Inc. and FP Publications, respective owners of competing, money-losing
newspapers in Montral, Ottawa and Winnipcgpondcrcd thcir options in the faceof
proposed changcs to competition laws which would nullify the effcct of the Irving
decision. Exccutivcs feared that any action to reducc compctitionbctwccn the chains
could lead to a "newspapcrCRTC" (Globe and Mail, Scpt. 22, 1983). They wcre
reassured in 1978whcn Indusuy MinisterJack Homer intimatcd that changes to the
law wouldnot bc forthcomingand thecxistinglegislationwould stand (Slotnick,Scpt.
21, 1983). The Montreal Star closcd in 1979, laving Thc Gazette as the surviving
English-languagedaily ncwspapcr in the city. Eventually,a deal was struck that took
I effecton Aug. 27,1980. The OttawaJournal and The Winnipeg Tribune wcre closcd
' (leaving Southan and FP dominant in Ottawa and Winnipeg respectively) while
Southam purchased interests in The Cazctte and Pacific Press of Vancouver which
wcre owned by Thomson NewspapersLtd., FP's parent company.Investigators from
thecombincsbranchsubrniucdareporton theseeventstothefederalAtlorneyGeneral
in January 1981(Rcportof the Director, 1981:59). In May 1981,Thomson,Soulham
I and afliliatcd companies wcre charged with conspiracy to rcsuain trade as well as
mcrgcr and monopoly. By Dcccmber 1983,the companies had been acquitted of all
charges (Slotnick, Dcc. 10, 1983). The anti-combines legislation as a mcans of
controlling mcdia ownership was effectively dcad.
I1 The Birth of PC0 2294.
Thc news of the closure of The O~tawaJournal and The Winnipeg Tribune on
August 27, 1980found.Multiculturalism Minister James Flcming at a meeting of the
Cabinctcornmittccon~rioritiesandplanning1.Aschairmanof thcCabinctcommittee
On Communications, he was designatcd government spokesman on the newspaper

6. 50 TheRegulation of Cross Media Ownership/Allan Bartley
situation. The followingweek Cabinctdecided to appoint a royal commission under
chairmanTom Kenttoinvestigatethenewspaperindustry.Fleming,aformerbroadcast
journalist who had been in Cabinetonly five months,was given responsibility for the
commission and subsequentpolicy development.
TheRoyalCommissiononNewspapers(hereaftertheKentCommission)reported
to Cabinet in July 1981. Among other measures,the Commission proposed a Canada
Newspapers Act which would require newspaper proprietors to meet certain
rcquiremcnts bcfore being gnnted a broadcasting licence in the same community
where their publicationswcre dominant(1981: 239-40). Therewould beprovision for
compulsory divestment in cases where existing cross-ownership was deemed in
violation of the legislation. The determination and adjudication of cross-ownership
situationswould fall to a new PressRightsPanel, with thcCanadian Radio-television
and TclecomrnunicationsCommission only peripherally involved as the broadcast
licencingauthority.
There was little or no pcrccivcd widespread public pressure for action on
cross-media ownership, Fleming said later,although he had personal concernsabout
the issue. He believed there was a potential for one man or organization lo control
news covcnge and opinion in certain local markets. The Irving position in New
Brunswick exemplified the kind of situation he fwd most. The pressure which
Fleming did identify on the issue came from workingjournalists, organized labour,
the Consumers Association of Canada "and probably more than anywhere else from
academia relating tojournalism." Flemingwanted to formulatea policy which would
avoid any futurecrisis over cross ownership involving newspapersand broadcasting.
The developmentof a policy response to the Kent Commission was coordinated
by thcPrivyCouncilOffice.Therewercpracticalaswellaspoliticalreasons forlinking
any subsequentproposals with this powerfulcentral policymakingagency.Therewas
no government department with a responsibility for newspapers to which the task
could be assigned. Furthermore, senior departmental bureaucrats were generally
"terrifically hostile" to the original Kent recommendations because of their
questionable constitutional status and the difficulty of implementing them
(Confidential source). Fleming, as a Minister of Slate, had a very small staff. To
research a policy, he necded the support personnel assigned from the Privy Council
Office. Fleming agreed to accept Alan Darling. PC0 director of operations, as
coordinator of the project. Although Fleming was initially reluctant. PC0 Clerk
Michael Pitfield persuaded him Darling had the necessary standing and authorityto
overcome bureaucratic opposition to developing a newspaper policy (Confidential
source).
Two groups wcre sct up to study Kent's proposals. Alan Darling headed both.
putting him at the centreof the policy analysispmess. The fist was a PC0 working
group which madea detailedanalysisof theproposals. Thesecondwas acoordinating

7. CANADIANJOURNALOF COMWNICATION, VOL. 13, NO. 2 51
committeeof assistant-dcputyministersfrom dep&tmentswith an intcrest in the Kent
recommendations -- Communications,Justice,Financeand Consumerand Corporate
Affairs. The PC0 working group -- Darling and two officers-- spent three months
examining the implications of Kent's recommendations. They consulted with the
Departmentof Communicationsand CRTC independcn~lyto ascertain thcir reaction
to irnplcmenting cross-mcdia ownership controls. The PC0 officers detcrmined.the
CRTC had been following an implicit policy for several years of not authorizing a
broadcastinglicenceto anew applicantif thc applicantalsoowneda ncwspapcr in the
samecommunity. They concluded Kent was recommendingthat the CRTC's implicit
policy become explicit for new licences, a significant conclusion in light of latcr
developrncnts.
Thc policy analysis took place at the same time as newspaper and broadcasting
companiesrcactcd to thc Kent rcport. Darling rcceivcd telephonecallsfrom Southam
and Thomson officials -- forwarded through Fleming's officc -- asking him to mcct
company lawycrs to hcar their vicws. Thc Canadian Daily Newspaper Publishcrs
Associationarrangcdto discussthe proposalsataconfcrcncc in Torontoin Novcrnber
1981. Darling attcndcd as an observer. Hc bcgan lo appreciate for the first time the
frustrationand hostilityof newspapcrpublishersandproprictors.However, on1ythose
whohcld broadcastinglicencessccmcdconccrncdaboutthepossibilityof cross-media
regulations. It was a distinction which did not go unnoticed in Fleming's officc.
Thc government's policy options were dcvelopcd during January and February
of 1982,apparently withoutoppositionfrom otherCabinet rninistcrswho had earlier
shared Fleming's concern about the constitutional implications of many of Kcnt's
rccommcndations (Gray. Fcb. 13. 1983). Abricfing paper prcparcd in late March by
Fleming and his staff was dismbutcd to ministerson the Cabinetcommitteeon social
development which reviewed possible governmcnt responses. The papcr defined
cross-mediaownershipas the "effectiveabilityto controlall newssources-especially
in local markets" (Mimco. March 31. 1982: 6). The possibility of constitutional
challengewas suggested for almost all ownershipcontrols(largely on the grounds of
interference with propcrty and civilrights)exceptin thecross-media area. The paper
recommcndcd a direction to the CRTC which would require "no cross-media
ownership in local markets except whcn such a rule would cause unfair hardship or
whcn market is extremely competitive" (1982: 29). The cross-ownershipproposal
received little attention in the document, probably bccausc it presentcd "no general
problem"(1982: 14).Adirection promised fewpoliticalcomplications.TheotherKent
proposals,by conwst, were a constitutional bog.
The Department of Communications would be responsible for any direction
issued under The Broadcasting Act. Fleming dealt dircclly with Communications
MinistcrFrancisFox who "wasvery supportivein this personally",although the same
could not be said forDOCofficialsin the beginning. "Therewas someargumentfrom
someofficialsthat there alreadywas a cross-mcdiarule," said Fleming. "I pointed out

8. 52 The Regulationof CrossMedia Ownership/AllanBartley
that clearly it was inadequate ..."Thc reluctant DOC officialswere concerned ulfl~llt
the political repercussions of a direction. If itproved a success.Flemingwould p l d l c
credit. If it was a disaster,they feared thcirministerwould be blamed. In fact. Fox tlj~d
Fleming had an undcrstanding that if CRTC interpretations of a direction wen. Ii)O
vague or otherwise incffcctive, they would bring in a more strongly-wordcd mcwIJrc
(Confidential source).
CRTC chairman John Mciscl supported the principle of cabinet directiv~,~
regulatory agencies. "Thereshould be greater guidance from the government lw.l'Jre
dccisionsaretaken,and lessof agovcmmentreview activityaftcrdecisionshavr Wn
taken." he told a House of Commonscommittee (Communicationsand Culture. IJcC.
6, 1982. 39:7). Hc did. however, favour some form of Cabinct appeal "bccaucl Ille
Cabinctdircctiveisvery likclytobeputin verybroad terms." Theroleof appcal ~ l r ~
be limited toensuringthat thecommission in factimplcmcntcdadirective,anda,rll!'~~
the intcrprctation Cabinct intendcd in issuing it. Mciscl's willingness to 11,' "PL
dircctions -- and Fox's cvidcnt willingness to issue lhcm -- suggested high I* vcl
unanimityon the principlc.
Flcmingoutlincdthc govcrnmcnt's plans in a spcech at the Univcrsityof WP-,~~'"'
Ontarioon May 25,1982. ThcCRTC would bc directed to rcjcct liccncc applic;~t.-"~~
or rencwals in cases whcrc ncwspapcrs opcratcd radio or tclcvisions stations tc the
same markct whcrc their publications circulalcd. Thc measure itsclf was t / * be
incorporated intoa subscqucntCanadaNcwspapcrs Act which cvcntually dial rf',
parliamcnlary ordcr papcr. Mcanwhilc,responsibility for regulating cross-owr~~~~"'
was to rcst with thc CRTC rather than thc new prcss rcgulatory agcncyrccomrn~,'~'~~
by thc Kcnt Commission.The emphasiswas thcrcby shiftcd to thc agcncy whir ; 'lad
alrcady taken the policy initiative scvcral years previously by adoptin.! "le
rulc-of-thumb inhcritcd from earlier broadcasting regulators. Thc dircction "*ld
formalize the informal.
There had bccn unofficial suggestions for some time in the civil scrvio. lhat
Cabinetmight call fora cross-mediaowncrship direction.Lawyersin the Dcpr *."Cnt
of Communicationsand the CRTC wcrc prepared for the possibility. In March '82'
a DOC lawycr was assigned to research carlicr CRTC dccisions i n ~ r . ' . ' ' ~
cross-ownership. The formal ordcr to write the dircction marked the bcginnirlPJ
scriesof consultationsand draftingsessionsin theDOC's lcgalbranch in thcftrsl ..wk
of Junc 1982.Thclawycrsconsulted bricfly with the DOC's own broadcasting . / l i i c y
scction.Howcvcr,becausc the dircction was to deal essentially with newspaper
was lillle input from that quarter. The DOC lawycrs made scvcral tclcphonc( .-."
Darling to clarify that draft tcxts conformed to Cabinet's intent on the directior.
ThcrcisevidcncetosuggesttheCRTChad litllcimpacton thepolicy forrnl:
process dcspite its existing cross-ownership policy and eventual responsihilm
for
applying the direction. CRTC chairman Mciscl's first firm intimation of a dir -*don

9. CANADIANJOURNALOF COMMUNICATION, VOL. 13, NO. 2 53
came from Fleming's speech in late May. Although Mcisel had rcad thc Kcnt rcport,
he was not askcd for commcnt by Cabinct-levcl officials who felt it uyould be
inappropriateto consultdirectlywith a semi-judicialoffice ultimately responsible for
implementing whatevcr measures wcre decided on. Within the CRTC, thcrc was no
sense of a crisis -- rcal or impending -- ovcr cross owncrship. A draft copy of the
direction was forwarded by the DOC to CRTC general counscl Avrarn Cohcn for
comment in June. He discussed the draft with "some of the commissioners",other
CRTCofficialsandlawycrs.Theissuedidnotrequirespecialstudy,given h e agency's
long-standinginterestin thc area.Mcisel reviewed the draftwith Cohcn. They apccd
the proposed wording was gencral and loosc.Thcirsuggestionsfor improvingthc tcxt
were sent back to DOC. It is not known if thcsc were accepted. But if thcy wcre, thc
ambiguous language of the direction suggests that carlicr versions must have bccn
vagucindccd. Only aftcr the directionhad becn issued did Mciscl discussit with othcr
commissioners,and thcn only toconsider how hearings involving thedircctionshould
be slructurcd.
The CRTC cxecutivc may not havc bccn wcll-informed about the devclopmcnt
of cross-owncrshippolicy at the political lcvcl. An agcncy official claimed thcrc was
considcnblc friction bctwccn Fox and Flcming ovcr thc direction, but the oppositc
seems to havc becn truc. The same official said thcrc was limitcd intcrcst in thc
directionat thc CRTC bccause it was considcrcda "symbolic"mcasurc bcing pushcd
by Flcming for his own political bcncfit. Furthcrmorc, CRTC and DOC officials
regardcd the dirccdon as something that "had to bc got through" bccausc a ministcr
had "abcc in his bonnct." Burcaucratic rcsignation, if it cxistcd,may have rcflcctcd a
feeling that thcrc was little chance of affccting dccisions givcn thc strong PC0
involvcment in thc proccss. Thc CRTC may havc simply bccn out of touch with its
political mastcrs in this mattcr, perccivcd the dircction as a ralilication of cxisting
policy and procecdcd accordingly.
Mcanwhilc, DOC lawycrs rcscarching CRTC preccdcnts dccidcd thc agcncy
rulings wcrc not vcry sophisticated in thcir explanations of why cross-mcdiaowncrs
were awarded or dcnied licences. The lawycrs faccd two major problcms in writing
the direction.Thc fist was a definitionof "control".TheForeign Investment Rcvicw
Agency was consulted on the specifics and subtleties of business control situations.
The seconddifficultywas pinning down the ideaof "co-location",thc conccptof two
media sharing the same market area. No specific use was made of thc
recommendations or research of the Kent Commission, although the DOC lawycrs
wcre gcncrally aware of the material.
A DOC draft was carried to a senior-lcvclmeeting which includedFleming,Fox
and Darling.Fleming later took responsibility for insistingon so-callcd"grandfather"
and "levcl-of-competition"clauscstopermit thcCRTCtoexcrcisediscretion.Thefirst
clause would permit the CRTC to cxclude from thc direction's provisions in ccrtain
cases cross-media proprietorswho already held licences.The cornpctitionclausc lcft

10. 54 The Regulation of CrossMedia Ownership/AllanBartley
it up to the CRTC to assess levelsand degreesof competition.Thedraftwas finalized
and forwarded to the Privy Council Officefor Governor in Council approval.
The principal policy actors shared a similar perception of the direction's intent.
Fleming saw the new measure as "simply a matter of strengtheningit and giving a
signalby government restatingand I believetougheningthe [existingCRTC]policy."
The lawyerswho drafted it believed a direction would give "a lcgal foundation"to an
existingpolicy. "Itdidn't change the Commission'sapproach,"said one. Alan Darling
argued the directionput the CRTC's implicitpolicy on a f i e r lcgalbasis,especially
ifchallengedincourt. "Thedircctivercinforccdtheirpolicyandgaveita legalsanction
which it previously didn't have ..." The directivewas also a warning to newspapers
nottocontcmplatcfutureinvestmentsinbroadcasting."I think that's clearly,explicitly,
an area of invcstmcntnot to be pursued," Darlingconcluded in late 1983.Timewould
tell.
I11 The Life and ShortTimes of PC0 2291
CRTC licence hearings in 1983 saw publishers and broadcasters attack the
dircction. The Canadian Daily Newspaper Publishers Association maintained the
Commissionhadalreadyapplied"meaningfulcross-ownershiprestrictions"duringthe
prcvious 15years. The publishers urged the Commission to hcw to its proven policy
of examining each case on its merits. "In general ...we believe the public interest is
best scrved by inlcrpreting the directionso as to cause the least disruption to existing
rights and service" (CDNPA Brief, May 24, 1983). The Canadian Association of
Broadcasters called for the renewal of cross-owned licences in the public interest,
noting that "the fact of cross-ownership is not in itsclf offcnsive" (CAB Brief, May
24,1983).
Itmay bearguedthedirectionhad sometangibleimpac~TheIrving family's New
Brunswick BroadcastingCo. Ltd. made changes in pcrsonncland corporatestructure
to avoid chargcs the broadcasting and newspaper operationswere controlled by the
sameindividuals(Wood,Feb. 26.1983).TheCRTC approvedthe saleby Southamof
10pcrccnt of its Sekirk shares to a third party, thcrcby "removing Sellcirk from the
provisions of the cabinet directive"(Globeand Mail, Sept. 8, 1983). Adeal in which
Maclcan-Huntcrpurchased a substantial interest in the Toronto Sun newspaperchain
was dclibcratcly structured to avoid the direction's provisions(Alan Darling, 1983).
However, there is littleevidencethe direction increased the sourcesof news and
opinion in areas with newspaper and broadcasting cross-ownership. The CRTC
continued to rencw licenceswhcrecrossownership was an issue. Themost important
cascinvolvedNew Brunswick BroadcastingCo.Ltd.TheCommissionconcludedthat
non-renewalof thc Irving licenceswould be in the public interest,
but forthe factthat the licences in questionallexpireon 30 September, 1983
with the result that there would be a sudden cessation of the only sourceof

11. CANADIANJOURNALOF COMMUNICATION,VOL. 13, NO. 2 55
CBC English-language television service in New Brunswick. Such a
cessation of service would be contrary to overriding public interest
considerationsinthatitwouldadverselyaffcctserviceto thcpublic(Decision
83-656: 10-11).
In other cases, the CRTC ruled that "effective ownership and control of the
licensee" did not reside with acompany setup by ncwspaper publisher Ken Thomson
(Decision 83-675:5); that "failureto grant a licencerenewal forCFPLLondon would
be contrary to overriding public intcrcst considcradons" (Decision 83-676: 7); that
"MHL(Maclean HuntcrLtd.) docsnotcffectivclyown or control,nor is in aposition
to effectively own or control, the Toronto Sun Publishing Corporation" (Decision
83-773:7).Thedecisionsdied on the vague languagcandexccptionsprovidedin the
dircction. David Townshcnd concluded the direction may have servcd only to
legitimize owncrshippattcms which could have bcen dcalt with overtimc using othcr
means (1984:282).
However, there wcre fcw altcmativc proposals to stcm cross ownership. The
CRTCappmnlly madc no cfort to devclop new options.Theopposition Progressive
Conscrvativcsfavoredcompctidonbetwcen the print and clcctronicmedia but not to
the detriment of current proprietors. Conservative critic Pcrrin Beatty called for
changesto thetax lawstoprcventfamily-ownedfirmsbcingforcedtosellouttochains
and to encourage advertising expenditures (House of Commons, Dcbates, June 9,
1983: 26220, 26237) The Liberal government droppcd its media initiatives in thc
summcrof 1983, coincidcntwith Jim Flcming's rcmoval from Cabinet. Mcanwhilc,
proposcd changes to the anti-combincs legislation (subscqucntly passcd largcly
unchanged as The Competition Act of 1986 by thc Conservative govemmcnt) may
havc bccn sccn by Liberalsas an altcmativc policy instrumcnt. But, it was not clear
how, or if, or to what extent, the new competition rules would affcctcross-ownership
situations.
Thedirection's authoritywas affirmedby the courts,a vindication of the various
claims of enhancedlegal standingforCRTCpolicy. The Irvingfamily challcngcd the
directionasaresult of the short-termrcriewalof in broadcastinglicences. TheFedcral
Court ruled in July 1984 that the directivewas within the power of the CRTC, that it
was not directed against the Irvings in particular or newspaperproprietors in general
and Lhat it did not violatc the Irvings' righ~sto free speech or to hold property. The
court concluded the direction "says nothing and does nothing to regulate either the
concentration of owncrship of newspapers or the owners.of newspapers" (New
BrunswickBroadcastingCo. Ltd. v. CRTC. [I9841 2F.C. 412).
The direction remained intact through a change in CRTC leadership and a new
Conservative government. But in April 1985. CRTC chairman Andre Bureau told a
Montreal audience the commission was willing to ease its broadcasting
cross-ownershiprestrictions"on a case-by-casebasis, if that is what it would fake to

12. 56 The Regulationof CrossMedia OwnershipIAllanBartley
ensure strength and long-term viability" for the industry (Canadian Press, April 4,
1985). A few days later Communications Minister Marcel Masse announced a
broadcastingpolicy review,although Bureau responded that his agency would not be
making immediate major policy changes as a result (Westcll, April 10, 1985).Two
months laterPC02294wasrevoked by Cabinetwithout explanation.ShirleyScrafini,
the CRTC's director-generalof broadcasting, was quoted latcras saying the directive
had "served its purpose" and its continuance "would impose a burden on both the
industry and the commission" (Westcll,June 4. 1985).The death of PC0 2294 was
not viewed by thecommission as a policy change.Thisis no surprise,given what had
gone before. "TheGovcmmentwants competition in the media but 'feelsit has other
instruments for doing that,' including combines laws," according to Serafini. It was
not explained how this could be, given h e uncertainties of cxisting and proposed
Icgislation.
Conclusion
PC02294 was a flawed governinginstrument It was a political directionrather
than a policy direction, choscn because it appeared the least mublesome of the
availableoptions.Itwasanincrcmcntalmeasurewhichattcmptcdtoformalizedefaclo
proccdures already implcmenled by the regulatory agcncy. And evcn then, the
direction would have bccn unnecessary had Cabinct provided some guidance on
cross-media owncrship in the past. By 1982, howcvcr. Ihc initiativehad passcd long
bcforc into the handsof Ihc regulatory agcncy.
Thc prcdictabledynamicsof policy directionsc a m to the fore. The Cabinctand
senior bureaucrats bccame the targets of industry lobbying. Thcrc were lcgal
challcngcs to thc direction's impartiality and intcnt Thc court's ruling confirmed the
direction's legal authority. Vaguc language used to avoid charges of discrimination
crcatcd confusion about thc dircction's exact meaning. Uncertain interpretations
flowcd from ambiguous language. The CRTC's intern2 policy was replaced by an
extcmal ordcr developed by officials lacking the agency's long experience in the
subject.Itislittlewondcr thatapplicationof thcdirectionprovoked acranky rcsponse
from regulators and rcgukcd alike.
The cross-mediaowncrshipdirection was essentiallysymbolic in origin, content
and administration. It was symbolic in origin because it was a substitute for the
untenable policyproposalsmadeby the KentCommission.It wassymbolic in contcnt
because its provisions did littlemore than attempt to formalizean imprecise defaclo
CRTC policy. It was symbolic in administration bccause it did not --and could not --
meet the claims madc for it by Cabinct. PC02294 was a creation and a victim of
political convcnicnce. It is a conclusion hat servesequally well as epitaph.

13. CANADIANJOURNALOF COMMUNICATION,VOL. 13, NO. 2 57
Notes
I wish to acknowledge the counsel of Prof. Richard Schultzand Cathy Duggan
of the Centre for the Study of Regulatcd Industries. Dcpartmcntof Political Scicncc.
McGill University.
1.Thcbulk of thissectionisbasedon interviewswith thcofficialsnamed,aswcll
asothers who requested anonymity.The quotations,unless othcnviscnoted,arc from
interviewsconducted by the author as part of the rescarch for an MA thesis. Allan
Bartley(1984) "The Magic Solution: The Cross-Mcdia Ownership Dircction,"
Unpublished MA thesis, McGill Univcrsity,Montreal.
REFERENCES
Books
DouglasHartlc(1979)PublicPolicy,DecisionMaking andRegulation,(Buttcrworths:
Institutefor Research on PublicPolicy. Toronto).
C.C. Johnston (1980) The Canadian Radio-Television and Telecommunications
Commission. A Study of Administrative Procedure in the CRTC, (Supply imd
SCN~C~S:Ot~awa).
LucindaVandcrvon(1979)Political Controlof IndependentAdministrative Agencies.
(Supply and Scrviccs: Ouawa).
Articles
Robcn Babe (1976) "Rcgulation of private tclcvision broadcasting by the Canadian
Radio-Tclcvision Commission: a critique of cnds and means," Canadian Public
Administration, Vol. 19.pp. 552-586.
Christopher Green (1981) "Canadian Competition Policy At A Crossroads,"
Canadian Public Policy, Vol. 7, No. 3(Summer),pp. 418-432.
David Henry (1970) "The Combines Investigation Act and the Mass Media,"
Canadian CommunicationsLaw Review, Vol. 2 (Deccmbcr),pp. 216-227.
H.N. Janisch (1987) "Indcpcndence of Administrative Tribunals: In Praise of
'Structural Heretics'," CanadianJournal of AdministrafiveLaw and Practice, Vol.
1.No. 1 (September)pp. 1-19.
( )(1979) "PolicyMaking inRegulation: Towards ANcw Definitionof
Lhe Slatus of Independent Regulatory Agencies in Canada," Osgoode Hall Law
Journal, Vol. 17,No. 1pp. 46-106.

14. 58 The Regulation of Cross Media Ownership/AllanBartley
Patrick Kenniff (1979) "Political Control of Independent Regulatory Agencies" in
Aspects ofAnglo-Canadian and QuebecAdministrativeLaw, ed. P. Garant,(Faculte
de Droil,UniversiteLaval: Quebec).
Peter Oliphant and Roben White (1981) "A financial and economic study of the
newspaper industry in Canada," in TheNewspaper as a Business.Research Vol. 4.
(Omwa: Royal Commission on Newspapers).
Andrew Roman (1985) "Govcrnmcntal Control of Tribunals, Directives, and
Non-Statutory Mechanisms," Quecn'sLaw Journal,Vol. 10.pp. 476-497.
( ) (1981) "Cabinct Directions rn Regulatory Agencies: A Bold Leap
Backward." RegulatoryReporter, Vol. 2 (December). pp. 137-158.
DavidTownshend(1984)"Regulationof Newspaper/Broadcasting,McdiaOwnership
in Canada," Universiryof New Brunnvick Law Journal,Vol. 33. pp. 261-282.
Official Documents
Canada.TheBroadcasting Act, R.S.C.. 1970.
Canada. Consolidated Regulations of Canada. Chapters 376-8. Vol. 4. Ottawa:
Quccn's Printer. 1978.
Canada. House of Commons. Bill C-16. An act respecting Tclecommunicationsin
Canada. Fourth Session, 30h Parliamcnt.1978.
Canada. House of Commons.Debates. 1983.
Canada.Houseof Commons.FinalReport. SpecialCommitteeonRegulatory Reform.
Dec. 18-19.1980.
Canada. House of Commons. Committee on Communications and Culture.
Proceedings. Dcc. 6, 1982.
Canada.Report of theDirector ofInvestigationandliesearch.CombinesInvestigation
Act. 1981.
Canada. Royal Commission on Financial Management and Accountability. Final
Report. Ottawa: Supplyand Services. 1979.
Canada. Royal Commission on Ncwspapers. Reporf.Ottawa: Supply and Services
Canada. 1981.
Canada. StatutoryOrders and Regulations.PC0 1982i2294.July 29,1982.
rdcrs and Regulations.PC0 19854735.May 30.1985.

15. CANADIANJOURNALOF COMMUNICATION, VOL. 13, NO. 2 59
CRTC Documents
Decisions: 72-221, 72-316, 74-44, 78-669, 79-8, 83-656, 83-675, 83-676, 83-677,
83-773.
Notices of Public Hearing: Feb. 9,1979; May 10, 1979.
Newspaper Reports
CanadianPrcss (April4,1985). "CRTC saysit's willingtocaseownershiprules." The
Gazette.
The Globe and Mail (Sept. 8,1983). "CRTCrenews liccnccs in four applications."
-4Sept. 22. 1983). "Chainssaw competition crisis. wid told."
John Gray (Feb. 14, 1983). "Critical press owners being unreasonable, Fleming
grumbles." The Globe and Mail.
LomeSlotnick(Sept.21,1983)."Papcrsfatedcbatcd,courttold." TheGlobeandMail.
--(Dm. 10.1983) "Newspaperchins clearedof CombinesAct charges." The Globe
and Mail.
Dan Wcstell (April 10,1985)."Masscannouncesbroadcastpolicy review." TheGlobe
and Mail.
--(June 4,1985). "Irvings to benefit from rcvocationof order." The Globeand Mail.
Chris Wood (Fcb. 26, 1983). "Irvings take aim at Ottawa in defense of liccnce
renewal." TheFinancial Post.
Other Sources
Allan Bartley (1984) "Thc Magic Solution: The Cross-Media Ownership Dircction,"
Unpublished MA thesis, McGill University, Montreal.
Canadian Association of Broadcasters. Intervenrion,Jan. 26, 1983;Intervenrion and
Oral Submission.Calgary,May 24, 1983.
Canadian Daily NewspaperPublishers Association.Brief. Calgary,May 24, 1983.
Mimeo (March 31, 1982) "Response to the Royal Commission on
Newspapers-Ministers'Eyes Only."
Case
New Brunswick BroadcastingCo. Ltd. v. CRTC. [I98412 F.C. 410.