Canada: CRTC Shapes Canadian "Net Neutrality" Rules

The Canadian Radio-television and Telecommunications Commission (CRTC) recently issued decisions to conclude two important Internet-related proceedings linked closely to concerns over "net neutrality". The first decision, which pertained to Internet traffic management by ISPs, set out ground rules that:

  • prohibit content-blocking,
  • require prior approval for throttling or shaping wholesale connections sold to other ISPs,
  • require advance notice followed by a waiting period before shaping traffic on retail connections, and
  • establish a framework for reviewing traffic management practices on the grounds that they are not necessary or proportional.

The second decision, which pertained to audio and audiovisual content on the Internet, created a similar framework for reviewing discriminatory behaviour in respect of the making available and delivery of such content.

Together, the decisions establish a regulatory framework that clarifies the remedies available to content providers, consumers, and service providers against discriminatory or anti-competitive behaviour related to Internet access and audiovisual content. The decisions do not provide a complete code of conduct. Parties feeling aggrieved will likely have to apply to the CRTC for a remedy against what they perceive to be discriminatory or anti-competitive behaviour, just as they would to a court. Also, additional pieces of this regulatory framework remain to be determined later. These include a Federal Court of Appeal decision that will determine whether undue preference rules for audiovisual undertakings apply to the provision of Internet access.

However, particularly in the context of growing public concern over the state of Canadian broadband adoption, the CRTC's emerging Internet regulatory framework provides an unusually detailed set of rules for Canadian market participants to follow and for foreign jurisdictions to review in establishing their own rules-based frameworks.

1. Internet Traffic Management


Unlike in the US,1 political and high-level policy positions related to net neutrality in Canada have been limited to a 2006 Telecommunications Policy Review Panel recommendation2 and more recent private members' bills in Parliament.3 The CRTC's developing approach to net neutrality has largely taken place without clear government policy guidance.4 Indeed, the government's principal telecom policy guidance during the unfolding of the net neutrality debate has been a 2006 Cabinet direction to the CRTC (the "Policy Direction") requiring the Commission to rely on market forces in matters of telecommunications regulation to the maximum extent feasible, and to ensure that any technical regulatory measures are implemented in a symmetrical and competitively neutral manner to the greatest extent possible.5

Some Canadian discussion of network neutrality did take place in the 2004-2008 timeframe. In 2005, an incumbent telco exercised its own notice-and-takedown procedures on a union website that was allegedly advocating damage to property and violating privacy during a labour dispute.6 In 2006, a cableco selling its own voice-over-Internet-protocol service also began selling a "quality of service" add-on to optimize the use of third-party voice-over-Internet services.7 Also in 2006, a human rights litigant sought to have the Commission order the blocking of two websites that allegedly communicated hate and advocated genocide, offences under the Criminal Code.8 However, the first significant Canadian net neutrality decision was the CRTC's 2008 determination that Bell Canada's peak-hour "throttling" of peer-to-peer Internet traffic passing through a tariffed wholesale service did not result in undue discrimination. The Commission found that Bell Canada had demonstrated congestion existed and that, in response, Bell was applying traffic shaping to wholesale and its own retail traffic in the same way. However, the Commission also found that Bell Canada had erred in not providing clear and meaningful information about the traffic shaping, with at least 30 days' notice, to its wholesale customers.9

In rendering the Bell Canada traffic management decision, the Commission also announced that it would undertake a more comprehensive proceeding regarding Internet traffic-shaping and traffic management practices.10 The purpose of this proceeding would be to determine whether and how the CRTC would apply two provisions of the Telecommunications Act to Internet access providers: subsection 27(2), which prohibits facilities-based telecommunications carriers in Canada from unjustly discriminating, conferring an undue or unreasonable preference or subjecting any person to an undue disadvantage; and section 36, which prohibits the same carriers from unapproved control over the content, or influencing the meaning or purpose of telecommunications they carry for the public.11

The resulting inquiry into Internet traffic management, launched in December 2008, ran for seven months. It proceeded through three rounds of submissions from interveners, including creators' and citizens' groups, offline and online content providers, equipment manufacturers, network operators, software providers, and expert reports from leading American and Canadian Internet architects. It incorporated public and confidential data obtained from all of Canada's largest ISPs, a purpose-built website for public commentary, and seven days of live-streamed public hearings. The Commission rendered its decision on October 21, 2009.


In Review of the Internet traffic management practices of Internet service providers (the "ITMP Decision"), the Commission characterized the issue before it as follows:

At the core of the debate over "net neutrality" is whether innovation will continue to come from the edges of networks, without permission. Will there continue to be rapid and uncontrolled innovation in computer communications? Will citizens have full access to that innovation? The Commission earnestly hopes so. However, due to the limited capacity of their networks, carriers have legitimate interests in the management of these networks. Will they be able to develop networks that can bear the traffic generated by this innovation? Will they, in turn, be empowered to innovate?12

Subsection 27(2) (relating to unjust discrimination, undue preference and undue disadvantage) and section 36 (relating to blocking content) of the Telecommunications Act (the "Telecom Act Provisions") govern only network-facilities-based telecommunications carriers. The ITMP Decision addresses this limitation by distinguishing facilities-based "primary ISPs" from non-facilities-based "secondary ISPs," as follows:13

  • a primary ISP, which is regulated directly by the Telecom Act Provisions, is defined as "an ISP that is also a Canadian carrier, generally offering both retail Internet services and tariffed wholesale services"; and
  • a secondary ISP, which is not regulated directly by the Telecom Act Provisions, is one that "uses tariffed wholesale services from a primary ISP to provide, among other things, its own retail Internet services."

In addition to following the ITMP Decision's rules directly, primary ISPs must insert conditions into their service contracts and other arrangements with secondary ISPs requiring the latter to comply with similar rules.

This technique for indirectly regulating non-facilities-based carriers not directly addressed by the Telecommunications Act, which the Commission has used on a number of occasions in the past, extends new rules regarding advance notification,14 enforcement of subsection 27(2),15 and privacy16 to secondary ISPs. However, three questions remain in this regard. First, the ITMP Decision does not require primary ISPs to enforce the section 36 prohibition on content blocking in agreements with secondary ISPs. It is not clear whether this was deliberate or an oversight. Second, although no secondary ISP can operate without buying some service from a network-facilities-based carrier — for instance, access lines to which to connect Digital Subscriber Line Access Multiplexers (DSLAMs) — the CRTC is phasing out mandated access and tariffing of wholesale services it has found to be non-essential, which may include some access services.17 Third, and related to this issue, some non-facilities-based ISPs purchase bandwidth (including access lines) from Canadian carriers that are not directly related to ISPs — and the ITMP Framework does not specify whether an "an ISP that is also a Canadian carrier" refers to ISPs and Canadian carriers that are "related parties", or whether some other definition is intended.18 It is not clear whether non-primary ISPs that purchase only non-tariffed wholesale services, or that purchase wholesale services only from facilities-based carriers that are not ISPs, are intended to be secondary ISPs regulated under the ITMP Decision.

The ITMP Decision is intended to apply to both wireline and wireless Internet access, although its application to wireless Internet access is an "expectation". The initial CRTC public notice initiating this proceeding did not restrict its inquiry to wireline networks. It did not appear to contemplate wireless networks. But a number of interveners pointed out that, although providers of wireless Internet access are at least as likely to manage Internet traffic as wireline providers, the Commission had in the past forborne from regulating wireless data services. In the ITMP Decision the Commission:

acknowledges the unique capacity constraints of mobile wireless networks and notes that such constraints, combined with the rapid growth of mobile wireless data services, are likely to lead to congestion as mobile wireless data traffic increases in volume. ISPs will increasingly look to both economic and technical ITMPs to address the increased usage and changing traffic patterns on their mobile wireless networks.19

The Commission "expects ISPs using mobile wireless data services to offer Internet access services in accordance with the determinations of this decision" until such time as the Commission reviews, as it intends to, "the appropriateness of reapplying" the relevant section of the Telecommunications Act to mobile wireless data services.20 Doing so would allow the Commission to apply the ITMP Decision more forcefully to wireless Internet access.

Economic and Technical Measures

The ITMP Decision distinguishes between two kinds of Internet traffic management practice (ITMP): economic ITMPs and technical ITMPs. Economic ITMPs are pricing mechanisms like usage-based billing, which meters usage after a monthly transfer limit is reached or during certain times of the day. Technical ITMPs are a way to manage traffic using technological means. These means include rate-limiting (slowing down) or increasing packet loss associated with certain traffic, prioritizing traffic associated with some users or applications or destinations over others, or identifying heavy users to limit their bandwidth consumption.

The Commission's general approach to regulating economic and technical ITMPs will be threefold. First, certain traffic management practices are automatically permitted (those addressing "bad traffic") or prohibited (those blocking content or compromising privacy). Second, other traffic management practices will be tested against a four-factor "framework" before they are permitted to be implemented. Third, still other ITMPs that have been announced and, after a waiting period, implemented, may be tested against the four-factor framework in response to a complaint or on the Commission's own motion.21

Automatically Permitted or Prohibited

Measures to reduce or eliminate what have been called "bad traffic"22 will be permitted. These widespread technical ITMPs address practices for managing spam, for containing malicious software, and for preventing the "distribution of illicit materials."23 The Commission will not regulate these ITMPs unless a complainant can credibly demonstrate that they are being used for some other purpose.

Measures that block content or that use private information for improper purposes will be prohibited. No primary ISPs will be permitted to block access to content, unless they apply for and secure approval under "exceptional circumstances" by demonstrating that such blocking is consistent with the Canadian Telecommunications Policy set out in the Telecommunications Act.24 An ISP that delays traffic flows, such as by implementing Deep Packet Inspection intermediaries that drop packets associated with or rate-limit those flows, will be considered to have blocked access to content if time-sensitive audio or video traffic is degraded noticeably. This would include situations such as the introduction of excessive delay or jitter, and others where the practice interferes with time-sensitive content in a way that so slows the content as to effectively control it and influence its meaning and purpose.25

With respect to privacy,26 primary and secondary ISPs must not use the personal information collected during traffic management for any other purpose. In particular, they may not use such information for targetted or "behavioural" advertising.27 This rule is intended to supplement the standard set by the Personal Information Protection and Electronic Documents Act (PIPEDA) administered by the Office of the Privacy Commissioner of Canada (OPC).28 In creating the rule, the Commission rejected jurisdictional arguments suggesting that the OPC's administration of PIPEDA rendered the Commission's own oversight in this matter moot. Instead, the Commission adopted a position similar to the one proposed in the OPC's own Final Reply in this proceeding. In contrast to the approach taken by some other administrative bodies, the OPC's Final Reply contrasted the supporting role it plays in the telecommunications sector, as administrator of a statute of general application, to the CRTC's role applying the sector-specific Telecommunications Act.29

Advance Approval

Most economic and technical ITMPs applied to wholesale services will require advance approval, a form of ex ante (before-the-fact) regulation. The advance approval process for wholesale economic ITMPs will follow the Commission's existing tariffs procedure:

As the Commission continues to regulate wholesale service rates, and economic ITMPs applied to wholesale services involve charging rates for the provision of those services, the [Telecommunications] Act requires that they be included in tariffs approved by the Commission. In light of the foregoing, the Commission notes that primary ISPs must continue to file tariff proposals and to obtain prior Commission approval for the application of economic ITMPs to their wholesale services.

The Commission notes that such economic ITMPs will be evaluated using the ordinary principles for rate approvals.30

The ITMP Decision does not address wholesale services that will be exempted from tariffing.31 As a result, it is unclear what wholesale economic ITMP disclosure requirements, if any, will apply to wholesale services that the Commission has classified as phased-out non-essential services.

Primary ISPs must apply for and obtain advance approval before applying technical ITMPs to wholesale services in two circumstances. The first is where the same technical ITMP is not applied to the ISP's own retail customers. The second is where the technical ITMP is applied equally to retail and wholesale customers but, nonetheless, has a "significant and disproportionate impact" on secondary ISP traffic.32 Applications for advance approval of a technical ITMP, which will likely proceed under the proposed section 19 of the draft CRTC Rules of Practice and Procedure,33 must identify the purpose, effect and need for the ITMP. The Commission will review whether such applications meet each of four conditions:

  • designed to address the stated need and achieve the stated purpose and effect, and nothing else;
  • results in as little discrimination or preference as reasonably possible;
  • results in as little harm to secondary ISPs, end-users and others as reasonably possible; and
  • economic approaches, such as network investment, would not have reasonably addressed the need or effectively achieved the same purpose.

No advance approval will be required for wholesale technical ITMPs that primary ISPs apply equally to both retail and wholesale customers and that do not disproportionately affect wholesale customers. Similarly, no advance approval will be required for changes to wholesale technical ITMPs that result in management practices less restrictive than those currently in place, or that consist only of a housekeeping change, such as correcting a typographical error.34 Secondary ISPs that disagree about whether a technical ITMP affects them disproportionately and that cannot practically switch suppliers during the notice period, or secondary ISPs that disagree about whether a technical ITMP is a mere housekeeping change or is to the advantage of the customer, may apply for review of that technical ITMP.

ITMPs applied to wholesale services by persons who are not primary ISPs — in particular, facilities-based carriers that are not also ISPs, and secondary ISPs who themselves sell wholesale services on to other ISPs — are not subject to the above advance approval rules. Similarly, advance approval is not required for ITMPs applied to retail Internet access.35 Instead of prior approval, the Commission will rely on three measures to protect end-users and content providers who purchase Internet access: the retail advance-notice and disclosure rules, which give subscribers time to feed back to their ISP and, if necessary, choose another;36 wholesale ITMP regulation, to ensure there are other ISPs to choose from;37 and a CRTC review of ITMPs that have been implemented, which will generate a record of de facto rules for retail Internet service.38 The Commission considered it necessary to avoid ex ante regulation of retail ITMPs in order to comply with the Policy Direction requiring it to rely on market forces to the maximum extent feasible,39 and in light of "the large number of existing [primary and secondary] ISPs".40 The viability of a market with a large number of primary and secondary ISPs likely depends on the outcome of Commission regulatory decisions.41

Advance Notice

In order to apply nearly any ITMP, including ITMPs that do not require advance approval, an ISP must now first wait until it has provided its retail customers with at least 30 days' notice and, in some cases, even more time. This waiting period is in addition to any advance approval requirements described above, and to a complaints-driven review process to which all retail and wholesale ITMPs will be subject. The waiting period does not replace these remedies. Rather, it is intended to "allow consumers to make informed decisions regarding their Internet services".42 For secondary ISPs, the notice period is intended to provide the opportunity to react to changes that may affect their own provision of retail Internet services.43

Notification of wholesale ITMPs is to be addressed through the existing tariffs process. Any proposed tariff that primary ISPs file and that applies a new or revised ITMP must specify that it is effective no less than 30 days after any Commission approval. For tariffs that do not require Commission approval, primary ISPs must provide wholesale customers with revised tariff pages, specifying that the tariff has not been CRTC-approved, at least 60 days before implementing the new or revised ITMP.44

Rules for notifying retail ITMPs differ according to whether the ITMP is economic — in particular, a pricing measure — or technical. With respect to economic ITMPs, the Commission "expects", but does not order, that ISPs continue to disclose all pricing information to retail customers. The Commission further encourages ISPs to make real-time usage monitoring tools available to better apply this information.45 Although no formal requirement is set out, failure to meet the Commission's expectation would likely be counted against the ISP in any dispute adjudicated by the Commission or by the Commissioner for Complaints for Telecommunications Services. In any case, consumer laws and the ordinary principles of contracting generally require that customers have any material information about costs in order to consent to them.

With respect to technical ITMPs applied to retail Internet service, the Commission has set out explicit advance notice requirements. Every primary and secondary ISP46 must disclose, at least 30 days47 before they can adopt a technical ITMP, at least these five key facts:

  • who the retail ITMP will affect;
  • what type of Internet traffic (applications, classes of application, or protocol) will be subject to it;
  • when it will be deployed;
  • why it is being introduced, and
  • how it will affect users' Internet access speed and other aspects of their Internet experience.

These disclosures must be made clearly and prominently on a primary or secondary ISP website that complies with the World Wide Web Consortium's Web Content Accessibility Guidelines.48 This online disclosure must, further, be referred to in relevant marketing materials, customer contracts, and terms of service.49

The effectiveness of disclosure requirements in meeting the Commission's goals will likely depend at least partly on other events. There have been instances of upset consumers taking advantage of the Internet's capacity to aggregate dissatisfaction and successfully effect a change in their provider's policy — such as when Facebook changed its terms of service50 or Rogers changed its iPhone pricing.51 However, anything beyond "prosumer" activism during the 30-day advance notice period may be more difficult. The Commission intends that consumers can act on these disclosures to make an informed decision regarding their Internet access.52 But many Canadians likely53 subscribe to Internet access on the basis of fixed-length contracts accompanied by penalty fees for early departure. Subscribers who think they cannot exit their fixed-length contracts without paying early departure penalties will be much less likely to exercise informed decisions regarding their Internet access. Consumer law in many Canadian jurisdictions provides that a material change in the services supplied to a consumer on a continuous basis will enable the consumer to exit the contract.54 But, particularly as what constitutes a "material change" is a fact-based inquiry,55 ensuring that consumers are informed as to when they have the right to exit their contract, and that sales employees do not incorrectly advise them otherwise, may depend substantially on clarification by the Commission or other parties. The Commission, the Commissioner for Complaints for Telecommunications Services and consumer groups have important potential roles to play in this regard.

Complaint-Driven Reviews

The ITMP Decision provides for a complaints-based review process for addressing any economic or technical ITMP the complainant alleges is unduly discriminatory. This review process is to allow for end-users and third parties, such as content providers, to challenge a retail or wholesale ITMP they feel unfairly grants someone an undue preference or subjects someone to an undue disadvantage. An ITMP may be challenged irrespective of whether the practice is being applied equally to retail and wholesale customers, whether the ISP engaging in the behaviour insists that it is a housekeeping matter, or any other factor.

The Commissioner for Complaints for Telecommunications Services ("CCTS") was established in 2007, pursuant to a recommendation of the Telecom Policy Review Panel, to resolve complaints from individual and small business retail customers against service providers with annual Canadian telecommunications service revenues exceeding $10 million.56 The CCTS's mandate includes hearing complaints in respect of Internet access. However, while the complaints it hears may pertain to billing or compliance with customer contract terms and commitments, among other items, the CRTC has not assigned it any new role assessing the validity of a new ITMP under the Commission's ITMP Decision.

A consumer's dispute with an ISP relating to the quantum of a usage-based billing charge, or to the application of a technical ITMP that the consumer acknowledges he or she agreed to, may therefore be properly put to the CCTS. But, for the same reason, an end-user's, content provider's, ISP's, or third party's review application in respect of an ITMP to which they did not consent will generally be filed under the proposed section 19 of the draft CRTC Rules of Practice and Procedure,57 identifying the purpose, effect and need for the ITMP. The complainant must make out a credible complaint, including some form of evidence of different treatment, and provide reasoning tying that evidence to the four-condition framework set out in the above discussion on advance approval: the ITMP must be limited, minimal, proportionate and necessary for achieving a valid purpose. If the complaint is made out, then the burden of establishing that the ITMP meets the framework and, therefore, that any discrimination or preference is not undue, is shifted to the ISP in respect of whom the complaint was filed.58

Commission proceedings are far less cumbersome than a court's. Nonetheless, private citizens and individual consumers without legal training or firsthand familiarity with Commission proceedings may find it very time-consuming to prepare a review application in a way that complies with CRTC procedural rules and standards of evidence. As a result, there may be an important role for public interest groups and legal clinics to play in providing access to this process. In addition, Commission dispute resolution options for a dispute of this nature will generally include staff-assisted mediation or an expedited hearing process.59 If appropriate, expedited hearings are to take 90 days after mediation has unsuccessfully concluded.60

2. Audiovisual Internet Traffic

Broadcasting Order CRTC 2009-660, issued on October 23, 2009 ("New Media Exemption Decision"), concludes a series of regulatory proceedings on renewing the CRTC's New Media Exemption Order first passed in 1999.61 The New Media Exemption Order commits the CRTC to sticking to television and radio — that is, to not regulating audiovisual content made available and delivered on the Internet or to mobile devices. The immediate effect of this renewal is minimal. However, its passage now adds an additional Internet anti-discrimination rule to Canadian communications policy, and increases the Commission's role in monitoring the development of markets in audiovisual content on the Internet.


In addition to the Telecommunications Act, the CRTC oversees the Broadcasting Act.62 Despite the fact that the term "broadcasting" is associated in everyday speech and in technical terms with one-to-many communication as for television and radio, the Broadcasting Act is a technology-neutral statute. It assigns regulatory responsabilities to the Commission as a Canadian market authority for audiovisual content. Under the Broadcasting Act, the Commission must either license each undertaking that transmits audiovisual content over telecommunications networks in Canada, or explicitly exempt such undertakings from licensing.63 In order to implement such an exemption, the Commission must demonstrate that licensing or regulation of that particular class of undertaking would not contribute significantly to, among other things, Canadian programming production or spending, nor impair the ability of other, licensed undertakings to fulfil their mandates.64

In the past, the Commission has done exactly that, exempting audiovisual content delivered and accessed over the Internet, and all other audiovisual content delivered using point-to-point technology and received by way of mobile devices, from regulation.65 However, these exemption orders were due for review. The CRTC therefore launched a scope-setting proceeding in May 2008,66 followed by a full hearing beginning in October of that year.67 Its scope and scale were similar to that of the proceeding leading to the ITMP Decision. These "new media hearings" led, last June, to a regulatory policy (the "New Media Framework") and a proposed draft exemption order to implement the policy. Public comment on the draft exemption order was sought.68 The Commission's October 23, 2009 is a final determination adopting that exemption order.

The final New Media Exemption Order is identical to the draft order released last June. As expected, it modifies rather than replaces the 1999 order, which is referred to explicitly in the Copyright Act. This approach preserves the effectiveness of a Copyright Act rule that avoids granting Internet sites the same blanket permission to "retransmit" over-the-air television that the Copyright Act grants to cable and satellite companies.69 The New Media Exemption Order also simplifies its language by defining "new media" to include both audiovisual content accessed and delivered over the Internet, and audiovisual content delivered through point-to-point technologies to mobile devices.70

Undue Preference

A number of participants in the proceeding resulting in the New Media Framework argued for the insertion of undue preference rules into a revised new media exemption order. They argued that, just as undue preference rules are applied by the Telecommunications Act and in television and radio regulations under the Broadcasting Act, the Commission should also allow undue preference complaints in respect of increasingly prevalent audiovisual content on the Internet and on mobile devices. These arguments were somewhat unexpected, as the Commission had not proposed an undue preference rule for consideration in the consultation documents initiating the proceeding. However, the New Media Framework decision issued in response to the proceeding stated:

Despite assurances from the wireless industry that walled gardens are being replaced with open Internet access, the Commission notes that closed services are the norm in advance of greater mainstream adoption of more sophisticated devices. As such, the process of selecting content for those services must not subject unaffiliated programming undertakings to undue disadvantage with respect to reaching mobile audiences.

With respect to other new media broadcasting undertakings, the Commission does not consider that such concerns over undue preference are warranted. It recognizes, however, that this could change as business models for the aggregation of content offerings evolve. The Commission therefore considers the imposition of an undue preference provision to be appropriate.

Accordingly, in Broadcasting Notice of Consultation 2009-330, the Commission proposes amendments to the New Media Exemption Order, prohibiting new media broadcasting undertakings from conferring an undue preference on themselves or another person, or subjecting any person to undue disadvantage.

To provide guidance on the type of situation that could give rise to an undue preference in the new media environment, the Commission offers the example of a new media broadcasting undertaking engaged in programming distribution that acquires content from an affiliated programming undertaking either to the exclusion of non-affiliated programming undertakings or on more favourable terms or conditions than those applicable to non-affiliated programming undertakings.71

The draft language implementing the above reasons has now been included in the CRTC's New Media Exemption Order. In particular, the Order states that, in order to be exempted from licensing, new media broadcasting undertakings must:

not give an undue preference to any person, including itself, or subject any person to an undue disadvantage. In any proceeding before the Commission, the burden of establishing that any preference or disadvantage is not undue is on the party that gives the preference or subjects the person to the disadvantage.72

The procedure to be followed in applying for a review under this undue preference rule is very similar to reviews under the ITMP Decision. An application will generally be filed under the proposed section 19 of the draft CRTC Rules of Practice and Procedure,73 and can likely take advantage of the Commission's expedited rules.74 When an undue preference complaint is brought against a broadcasting undertaking — for instance, a website operator or aggregator, caching provider, or mobile provider in respect of "on-deck" or "off-deck" content — the initial burden of proof lies with the complainant, who must make out a credible case establishing the existence of a preference or disadvantage. Having done so, the onus then shifts to the allegedly infringing party to demonstrate that the preference or disadvantage was not undue.75 This approach is similar to complaint-driven reviews brought under the ITMP Decision, and in line with the Commission's recent approach under the Broadcasting Act.76

It is not yet known whether the above undue preference rule extends to primary and secondary ISPs when they provide access through the Internet to audiovisual content requested by end-users. That issue is to be settled by the Federal Court of Appeal, to which the CRTC has referred the question of Broadcasting Act jurisdiction over ISPs.77 An affirmative answer would result in an additional heading under which to pursue net-neutrality-like complaints related to audiovisual content.


In addition to adding an undue preference provision, the New Media Exemption Order also provides for the Commission to request information from exempted audiovisual undertakings in order to improve the Commission's monitoring of the sector's development:

The undertaking submits such information regarding the undertaking's activities in broadcasting in new media, and such other information that is required by the Commission in order to monitor the development of broadcasting in new media, at such time and in such form, as requested by the Commission from time to time.78

It is not yet clear how the Commission will use this additional power. However, in the past it has indicated its intent to

initiate at a later date, for comment by interested parties, a follow-up public proceeding on proposed reporting requirements for new media broadcasting undertakings. The follow-up proceeding will explore in greater detail the specific reporting requirements of new media broadcasting undertakings, identify which undertakings will be subject to the requirement and potentially examine the feasibility of identifying and measuring new media broadcasting content.79

In the New Media Exemption Decision the Commission reiterated and amplified this intent, stating that "the need to collect data that is relevant and meaningful to the Commission is of utmost importance." A consultation notice initiating a new proceeding to identify which market information to collect, and whether to do so as part of the existing framework that leads to the publication each year of the Communications Monitoring Report, is expected.


1 For instance, then-presidential-candidate Barack Obama made network neutrality a key piece of the technology platform in his Blueprint for Change. After being elected, President Obama chose Susan Crawford and Kevin Werbach to head his transition team's Federal Communications Commission (FCC) review and reaffirmed his commitment to network neutrality, eventually appointing Julius Genachowski to head the FCC. He also chose former FCC commissioner Jonathan Adelstein to head the broadband stimulus program at the United States Department of Agriculture's Rural Utility Services (RUS). All of the above-named had indicated support for net neutrality prior to their appointments.

2Telecommunications Policy Review Panel, Final Report 2006 (Ottawa: Public Works and Government Services Canada, 2006), Recommendation 6-5 and accompanying text.

3 For instance, Bill C-552, An Act to amend the Telecommunications Act, 2nd Session, 39th Parl., 2008 (introduced by Charlie Angus, NDP); Bill C-555, An Act to provide clarity and fairness in the provision of telecommunications services in Canada, 2nd Session, 39th Parl., 2008 (introduced by David McGuinty, Lib.); Bill C-398, An Act to amend the Telecommunications Act (Internet neutrality), 2nd Session, 40th Parl., 2009 (introduced by Charlie Angus, NDP).

4 Notwithstanding this difference ─ or perhaps because of it, the FCC only recently launched a rule-making proceeding similar to the one initiated by the CRTC in November 2008: see In the Matter of Preserving the Open Internet Broadband Industry Practices, GN Docket No. 09-191, WC Docket No. 07-52, Notice of Proposed Rulemaking (2009). However, there are many differences between the two countries' regulatory regimes, including procedural requirements and the regulatory status of Internet access. In addition, unlike the Canadian proceeding discussed here, the FCC notice of proposed rulemaking will proceed based on considerable accumulated experience with net neutrality: for instance, Appropriate Framework for Broadband Access to the Internet over Wireline Facilities; Review of Regulatory Requirements for Incumbent LEC Broadband Telecommunications Services; Computer III Further Remand Proceedings: Bell Operating Company Provision of Enhanced Services; 1998 Biennial Regulatory Review – Review of Computer III and ONA Safeguards and Requirements; Inquiry Concerning High-Speed Access to the Internet Over Cable and Other Facilities Internet Over Cable Declaratory Ruling; Appropriate Regulatory Treatment for Broadband Access to the Internet Over Cable Facilities, Policy Statement, 20 FCC Rcd 14986, 14987–88, para. 4 (2005) (Internet Policy Statement); Madison River Communications, File No. EB-05-IH-0110, Order, 20 FCC Rcd 4295 (EB 2005); and others.

5 Order Issuing a Direction to the CRTC on Implementing the Canadian Telecommunications Policy Objectives, P.C. 2006-1534, 14 December 2006.

6 TELUS, News Release, "Alberta court grants interim junction against posting TELUS employee photos" (28 July 2005), online:

7 Regulatory framework for voice communication services using Internet Protocol, Telecom Decision CRTC 2005-28, 12 May 2005, paragraphs 448-483, Reconsideration of Regulatory framework for voice communication services using Internet Protocol, Telecom Decision CRTC 2006-53, 1 September 2006, paragraphs 129-134; Access to the Quality of Service Enhancement Service of Shaw Cablesystems G.P. (Shaw) and PacketCable functionality of Rogers Communications Inc., Shaw, and Vidéotron ltée, Telecom Decision CRTC 2006-61, 21 September 2006.

8 File No.: 8622-P49-200610510, CRTC Letter to E. Antecol, 24 August 2006.

9 The Canadian Association of Internet Providers' application regarding Bell Canada's traffic shaping of its wholesale Gateway Access Service, Telecom Decision CRTC 2008-108, 20 November 2008, as modified by Re: Part VII Applications Requesting a Review and Vary of Telecom Decision CRTC 2008-108, CRTC Letters to T. Copeland, J. Lawford and J.-F. Mezei, 29 May and 1 June 2009.

10 Review of the Internet traffic management practices of Internet service providers, Telecom Public Notice CRTC 2008-19, 20 November 2008.

11 S.C. 1993, c. 38 ["Telecommunications Act"].

12 Review of the Internet traffic management practices of Internet service providers, Telecom Regulatory Policy CRTC 2009-657, 21 October 2009 ["ITMP Decision"].

13 Although "retail Internet access provider" would arguably have been a more accurate descriptor than the general "Internet service provider," the latter term has a long history in regulation and industry. The Commission has usually retained it but sought to clarify its meaning. We adopt the Commission's language in this note.

14 ITMP Decision, supra note 12, paragraphs 60 and 66.

15 Ibid., paragraph 50.

16 Ibid., paragraphs 100-105.

17 Revised regulatory framework for wholesale services and definition of essential service, Telecom Decision CRTC 2008-17, 3 March 2008, paragraphs 117-120 and 152-168, subject to determinations in the proceeding initiated by Proceeding to consider the appropriateness of mandating certain wholesale high-speed access services, Telecom Notice of Consultation CRTC 2009-261, 8 May 2009 ["Wholesale High-Speed Access Proceeding"].

18 Under paragraph 3840.03(g) of the Canadian Institute of Chartered Accountants' Handbook, on which the CRTC relies in its annual Data Collection System (DCS) exercise, "[r]elated parties exist when one party has the ability to exercise, directly or indirectly, control, joint control or significant influence over the other. Two or more parties are related when they are subject to common control, joint control or common significant influence. Related parties also include management and immediate family members": online: . See also, however, Affiliate rule, Telecom Decision CRTC 94-6, 4 March 1994, as modified by Regulatory safeguards with respect to incumbent affiliates, bundling by Bell Canada and related matters, Telecom Decision CRTC 2002-76, 12 December 2002, paragraph 158

19 ITMP Decision, supra note 12, paragraph 112.

20 Ibid., paragraphs 116 and 115.

21 Ibid., paragraph 47.

22 See, for instance, apComms, Can we keep our hands off the net? Report of an Inquiry by the All Party Parliamentary Communications Group (London: United Kingdom, 2009), Question #1.

23 ITMP Decision, supra note 12, paragraph 44.

24 Telecommunications Act, supra note 11, section 36; ITMP Decision, supra note 12, paragraphs 121-122. However, the Commission did not order primary ISPs to require secondary ISPs to apply this rule as term of their service contracts or other arrangements, supra.

25 ITMP Decision, supra note 12, paragraphs 125-127.

26 Telecommunications Act, paragraph 7(i) ("contribute to the protection of the privacy of persons").

27 ITMP Decision, supra note 12, paragraphs 103-104. However, see Call for comments on a proposed framework for the sale of commercial advertising in the local availabilities of non-Canadian services, Broadcasting Public Notice CRTC 2008-102, 30 October 2008, which may refine the policy framework for such advertising.

28 S.C. 2000, c. 5; ITMP Decision, supra note 12, paragraph 102 ("The Commission considers that in the circumstances of this proceeding, similar to the findings made in Telecom Decision 2003-33 and modified Telecom Decision 2006-15, it would be appropriate to impose a higher standard than that available under PIPEDA in order to provide a higher degree of privacy protection for customers of telecommunications services.").

29 Office of the Privacy Commissioner of Canada, RE: Telecom Public Notice CRTC 2008-19; Final Reply Submission, 28 July 2009, paragraphs 11-19.

30 ITMP Decision, supra note 12, paragraphs 77 and 78.

31 Wholesale High-Speed Access Proceeding, supra note 17.

32 ITMP Decision, supra note 12, paragraphs 80 and 82-84.

33 Call for comments on new draft regulations concerning CRTC Rules of Practice and Procedure, Broadcasting and Telecom Notice of Consultation CRTC 2009-602, 30 September 2009, paragraph 10 ("The Commission intends to apply the Part 1 process to among other things, the following applications: a. applications that were, in the past, filed under Part VII of the current Telecom Rules, more specifically ... v. applications related to conditions on the provision of telecommunications services under section 24 of the Telecommunications Act.")

34 ITMP Decision, supra note 12, paragraph 87.

35 Ibid., paragraphs 46 and 49.

36 Ibid., paragraph 61.

37 Ibid., paragraph 79.

38 Ibid., paragraph 47.

39 Supra note 5.

40 ITMP Decision, supra note 12, paragraph 46.

41 Wholesale High-Speed Access Proceeding, supra note 17.

42 ITMP Decision, supra note 12, paragraph 56.

43 Ibid., paragraph 89.

44 Ibid., paragraphs 90-93.

45 Ibid., paragraph 58.

46 Ibid., paragraphs 60 and 63.

47 This period is slightly revised in respect of a secondary ISP's retail ITMP disclosure that results from a primary ISP's wholesale ITMP revision: ibid., paragraph 64.

48 Ibid., paragraphs 60 and 67; Accessibility of telecommunications and broadcasting services, Broadcasting and Telecom Regulatory Policy CRTC 2009-430, 21 July 2009, paragraphs 65-68

49 ITMP Decision, supra note 12, paragraph 60.

50 Brad Stone & Brian Stelter, "Facebook Withdraws Changes in Data Use", New York Times, 19 February 2009, page B1.

51 Matt Hartley, "Rogers caves to complaints, unveils new 3G data rates", Globe and Mail, 9 July 2008.

52 ITMP Decision, supra note 12, paragraph 56 ("The Commission considers it vital that information regarding the ITMPs applied to the retail services of ISPs be made available to allow consumers to make informed decisions regarding their Internet services.").

53 The CRTC Communications Monitoring Report does not collect or publish contract length or churn information with respect to Internet access.

54 Telecommunications falls under the federal sphere of activity. However, note, for instance: British Columbia Business Practices and Consumer Protection Act, S.B.C. 2004, c. 2 at subsection 13(2) ("If a consumer is being supplied with goods or services on a continuing basis and there is a material change in the goods or services, or in the supply of the goods or services, the goods or services are deemed to be unsolicited goods or services from the time of the material change unless the supplier is able to establish that the consumer consented to the material change"); Ontario Consumer Protection Act, S.O. 2002, c. 30, at subsection 13(4) ("If a consumer is receiving goods or services on an ongoing or periodic basis and there is a material change in such goods or services, the goods or services shall be deemed to be unsolicited from the time of the material change forward unless the supplier is able to establish that the consumer consented to the material change"); Québec Consumer Protection Act, R.S.Q., c. P-40.1 at section 230 ("No merchant, manufacturer or advertiser may, by any means whatever, (a) charge any sum whatever for any goods or services that he has sent or rendered to a consumer without the consumer having ordered them").

55 For the purposes of the Ontario Consumer Protection Act, supra, the term "material change" is defined at section 20 of O. Reg. 17/05 as one that is "of such nature or quality that it could reasonably be expected to influence a reasonable person's decision as to whether to enter into the agreement for the supply of the goods or services."

56 Establishment of an independent telecommunications consumer agency, Telecom Decision CRTC 2007-130, 20 December 2007; Applications to review and vary certain determinations in Telecom Decision 2007-130 regarding the establishment of an independent telecommunications consumer agency, Telecom Decision CRTC 2008-46, 30 May 2008.

57 Supra note 33.

58 ITMP Decision, supra note 12, paragraphs 47-50.

59 Practices and procedures for staff-assisted mediation, final offer arbitration, and expedited hearings, Broadcasting and Telecom Information Bulletin CRTC 2009-38, 29 January 2009.

60 Ibid., paragraph 28-37.

61 Amendments to the Exemption order for new media broadcasting undertakings (Appendix A to Public Notice CRTC 1999-197); Revocation of the Exemption order for mobile television broadcasting undertakings, Broadcasting Order CRTC 2009-660, 22 October 2009 ["New Media Exemption Decision"].

62 S.C. 1991, c. 11.

63 Broadcasting Act, subsection 9(4).

64 Policy regarding the use of exemption orders, Public Notice CRTC 1996-59, 26 April 1996.

65 New Media, Broadcasting Public Notice CRTC 1999-84/Telecom Public Notice CRTC 99-14, 17 May 1999; Exemption order for new media broadcasting undertakings, Public Notice CRTC 1999-197, 17 December 1999; Regulatory framework for mobile television broadcasting services, Broadcasting Public Notice CRTC 2006-47, 12 April 2006; Exemption order for mobile television broadcasting undertakings, Broadcasting Public Notice CRTC 2007-13, 7 February 2007.

66 Scope of a future proceeding on Canadian broadcasting in new media, Broadcasting Public Notice CRTC 2008-44, 15 May 2008.

67 Canadian broadcasting in new media, Broadcasting Notice of Public Hearing CRTC 2008-11, 15 October 2008.

68 Review of broadcasting in new media, Broadcasting Regulatory Policy CRTC 2009-329, 3 June 2009 ["New Media Framework"].

69 Copyright Act, R.S. 1985, c. C-42, section 31.

70 New Media Exemption Decision, supra note 61, paragraphs 4-10 and Appendix, paragraph 1.

71 New Media Framework, supra note 68, paragraphs 60-63.

72 New Media Exemption Decision, supra note 61, Appendix, paragraph 2.

73 Supra note 33.

74 Supra notes 59-60.

75 New Media Framework, supra note 68, paragraph 64.

76 Regulatory frameworks for broadcasting distribution undertakings and discretionary programming services, Broadcasting Public Notice CRTC 2008-100, 30 October 2008, paragraphs 154-168; Implementation of certain elements of the regulatory framework for broadcasting distribution undertakings and discretionary services, and changes to contributions to Canadian programming, Broadcasting Regulatory Policy CRTC 2009-543, 31 August 2009, paragraphs 30-33.

77 Reference to the Federal Court of Appeal – Applicability of the Broadcasting Act to Internet service providers, Broadcasting Order CRTC 2009-452, 28 July 2009.

78 New Media Exemption Decision, supra note 61, Appendix, paragraph 3.

79 New Media Framework, supra note 68, paragraph 55.

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