The Supreme Court of Canada issued its decision in Reference re Broadcasting Regulatory Policy CRTC 2010-167 and Broadcasting Order CRTC 2010-168, 2012 SCC 68. The majority (5-4 split) held that the CRTC’s ‘value-for-signal’ policy empowering private local television stations to negotiate direct compensation for retransmission of signals by cable and satellite companies was ultra vires.

The policy would have required cable companies to pay TV stations for their signals.

The majority, in a decision written by Justice Rothstein held that while the CRTC had broad powers under the Broadcasting Act, its powers must be found in the Act and can not be contrary to other legislation, particularly Section 31(2)(b) of the Copyright Act. That section reads:

31. (2) It is not an infringement of copyright for a retransmitter to communicate to the public by telecommunication any literary, dramatic, musical or artistic work if
(a) the communication is a retransmission of a local or distant signal;
(b) the retransmission is lawful under the Broadcasting Act;
(c) the signal is retransmitted simultaneously and without alteration, except as otherwise required or permitted by or under the laws of Canada;
(d) in the case of the retransmission of a distant signal, the retransmitter has paid any royalties, and complied with any terms and conditions, fixed under this Act; and
(e) the retransmitter complies with the applicable conditions, if any, referred to in paragraph (3)(b).

The dissenting opinion, written by Justice Abella and Cromwell determined that the value-for-signal regime fell within the CRTC mandate as the CRTC had concluded that local stations’ potential revenue streams under the existing regime needed to be expanded in order to ensure the viability of local programming. They wrote that nothing in the Copyright Act immunizes re-broadcasters from the licensing requirements imposed by the CRTC.

Some press coverage: Globe & Mail, CBC, National Post and Star.