ISPs not broadcast undertakings says Supreme Court

The Supreme Court delivered its reasons this morning affirming the decison of the Federal Court of Appeal  in the  Broadcasting Reference case. The Court ruled that ISPs do not carry on “broadcasting undertakings” under the Broadcasting Act when, in their role as ISPs, they provide access through the Internet to “broadcasting” requested by end-users.

The reasons for the decison were given as follows:

Section 2 of the Broadcasting Act defines “broadcasting” as “any transmission of programs … by radio waves or other means of telecommunication for reception by the public”.  The Act makes it clear that “broadcasting undertakings” are assumed to have some measure of control over programming.  Section 2(3) states that the Act “shall be construed and applied in a manner that is consistent with the freedom of expression and journalistic, creative and programming independence enjoyed by broadcasting undertakings”.  Further, the policy objectives listed under s. 3(1) of the Act focus on content, such as the cultural enrichment of Canada, the promotion of Canadian content, establishing a high standard for original programming, and ensuring that programming is diverse.

An ISP does not engage with these policy objectives when it is merely providing the mode of transmission.  ISPs provide Internet access to end-users.  When providing access to the Internet, which is the only function of ISPs placed in issue by the reference question, they take no part in the selection, origination, or packaging of content.  We agree with Noël J.A. that the term “broadcasting undertaking” does not contemplate an entity with no role to play in contributing to the Broadcasting Act’s policy objectives.

This interpretation of “broadcasting undertaking” is consistent with Electric Despatch Co. of Toronto v. Bell Telephone Co. of Canada (1891), 20 S.C.R. 83.  In Electric Despatch, the Court had to interpret the term “transmit” in an exclusivity contract relating to messenger orders.  Like the ISPs in this case, Bell Telephone had no knowledge or control over the nature of the communication being passed over its wires.  This Court had to determine whether the term “transmit” implicated an entity who merely provided the mode of transmission.  The Court concluded that only the actual sender of the message could be said to “transmit” it, at p. 91:

It is the person who breathes into the instrument the message which is transmitted along the wires who alone can be said to be the person who “transmits” the message.  The owners of the telephone wires, who are utterly ignorant of the nature of the message intended to be sent, cannot be said … to transmit a message of the purport of which they are ignorant. [Emphasis added]

This Court relied on Electric Despatch in Society of Composers, Authors and Music Publishers of Canada v. Canadian Assn. of Internet Providers, 2004 SCC 45, [2004] 2 S.C.R. 427, a proceeding under the Copyright Act, R.S.C. 1985, c. C-42, to conclude that since ISPs merely act as a conduit for information provided by others, they could not themselves be held to communicate the information….

We therefore agree with Noël J.A.’s answer to the reference question, namely, that ISPs do not carry on “broadcasting undertakings” under the Broadcasting Act when, in their role as ISPs, they provide access through the Internet to “broadcasting” requested by end-users.  We would therefore dismiss the appeal with costs.

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