Archived — Notice No. DGTP-006-98

Industry Canada

Radiocommunication Act

No.DGTP-006-98:

Policy Consultation Paper Respecting the Authorization of Earth and Space Stations for Fixed Satellite Services Following the Coming into Force of the Gats Agreement on Basic Telecommunications

This Notice announces the release of a document entitled Policy Consultation Paper Respecting the Authorization of Earth and Space Stations for Fixed Satellite Services following the Coming into Force of the GATS Agreement on Basic Telecommunications, which solicits public comment on issues relating to the Canadian satellite policies (other than the policies governing satellites providing mobile satellite and broadcasting services) that are to be implemented as a result of the General Agreement on Trade in Services (GATS) Agreement on Basic Telecommunications, reached in February 1997 under the auspices of the World Trade Organization. Copies of the subject document are available from the Communications Branch, Industry Canada, 235 Queen Street, Ottawa, Ontario K1A 0H5, 613-947-7466, and from the offices of Industry Canada in Moncton, Montreal, Toronto, Winnipeg and Vancouver.

The Department of Industry invites written submissions from all interested parties. Submissions should be addressed to the Director General, Telecommunications Policy Branch, Industry Canada, 300 Slater Street, Ottawa, Ontario, K1A 0C8. To ensure consideration, submissions must be received on or before June 30, 1998. All submissions must cite the Canada Gazette Part I Notice publication date, title and the Notice reference number.

All submissions received in response to this Notice will be made available, about two weeks after the closing date of this Notice, for viewing by the public during normal business hours at the Industry Canada Library, 235 Queen Street, West Tower, 3rd Floor, Ottawa, Ontario, and at the offices of Industry Canada in Moncton, Montreal, Toronto, Winnipeg and Vancouver, for a period of one year from the close of comments.

This Canada Gazette Notice and the referenced publication are also available electronically on the Internet at:

World Wide Web (WWW)

http://www.ic.gc.ca/spectrum

March 5, 1998

Michael Helm
Director General
Telecommunications Policy Branch

Policy Consultation Paper Respecting the Authorization of Earth and Space Stations for Fixed Satellite Services Following the Coming into Force of the Gats Agreement on Basic Telecommunications

  1. Introduction

    The purpose of this policy consultation paper is to solicit public comments on the revisions to Canadian satellite policies (other than policies governing satellites providing mobile satellite and broadcasting services) that are to be implemented as a result of the General Agreement on Trade in Services (GATS) Agreement on Basic Telecommunications reached in February 1997 under the auspices of the World Trade Organization. The legislative changes needed to give effect to the Agreement on Basic Telecommunications are set out in Bill C-17, which was given first reading in Parliament on October 30, 1997. For a general review of the Agreement and the Canadian commitments made thereunder, regard may be had to the Industry Canada News Releases of February 15, 1997 and October 30, 1997.

  2. Background

    The existing fixed satellite services policy structure has evolved over a number of years, through changes in the policy directions for the operation of domestic satellite systems and the authorization of earth stations. Different regimes have been implemented for different kinds of commercial satellites, but the fundamental element of Canadian policy generally applied to all types of satellite services has been the requirement that Canadian facilities be utilized for services directed to Canadians, an early principle that has since been codified as an objective in paragraph 7(e) of the Telecommunications Act of 1993. A brief summary of the most salient features of the current Canadian satellite policy structure and industry provides a better understanding of the changes to be effected as a result of the GATS Agreement.

    Telesat Canada (Telesat) is a national communications common carrier, providing telecommunications and broadcasting carriage services via two fifth-generation Anik E satellites. Established in 1969, Telesat was fully privatized in 1992, and is today owned by Alouette Telecommunications Inc., a consortium of major Canadian telephone companies and Spar Aerospace Ltd. As part of its privatization, Telesat was granted a monopoly, originally until April 2002, for the operation of satellites to provide fixed satellite services in Canada, and between Canada and the U.S. The Telesat monopoly did not extend to the operation of satellites to provide mobile satellite, Direct Broadcast Satellite (DBS), or earth exploration satellite services. Nor did the monopoly extend to international telecommunication services provided by satellites (other than the noted provision of fixed satellite services to the U.S.), since these were provided by Teleglobe Canada Inc. (Teleglobe) pursuant to its separate monopoly. In accordance with longstanding and current practice, and also as part of the privatization agreement, Telesat is required to provide satellite facilities that ensure the availability of telecommunications services to all parts of Canada.

    Through the 1988 Canada/U.S./Mexico trilateral orbit utilization arrangement, Canada has access, for the deployment of satellites to provide conventional (C-band and Ku-band) fixed satellite services, to four geostationary orbit positions. These orbital positions are effectively available for Canadian domestic systems with Canada-wide coverage. Telesat uses its two Anik E satellites, located in two different orbital positions, to provide telecommunications and broadcasting carriage services throughout Canada, including the northern and more remote regions of Canada. Other companies use Telesat's satellites to distribute television and radio to cable affiliates, deliver signals to commercial stations, and provide two-way private Very Small Aperture Terminal (VSAT) networks for business communications.

    Transborder satellite services between Canada and the U.S., using the domestic satellites of each country, are provided under the terms of two sets of letters, exchanged between Canada and the United States in 1972 and 1982. Pursuant to the 1972 exchange of letters, the domestic satellite carriers of each nation are permitted to provide assistance to each other in cases where the other party experiences capacity shortages or emergencies (caused by, for example, the catastrophic failure of a satellite); satellite telecommunications services can also be extended to the other country on an incidental and peripheral basis. Under the 1982 exchange of letters, either Canadian or U.S. domestic fixed satellite facilities can be used to provide transborder services. Telesat was required by the Canadian government to negotiate with its U.S. counterparts an equitable share of traffic and a proportional share of revenues. As part of the 1992 privatization agreement, the Canadian government undertook to use its best efforts to ensure equitable use of Canadian fixed satellites.

    In 1995, the federal government reviewed the policy framework applicable to Direct-To-Home (DTH) satellite broadcasting. As one of the outcomes of that review, Industry Canada and Canadian Heritage jointly issued to the Canadian Radio-television and Telecommunications Commission (CRTC) a clarification of governmental policy respecting the use of satellites for the carriage of broadcast programming services that are to be delivered via Direct-To-Home (DTH) or DBS services. Pursuant to this policy, a Canadian satellite broadcasting distribution undertaking must make use of Canadian satellite facilities to carry all Canadian programming services, but may use either Canadian or non-Canadian satellite facilities to carry foreign-originated services that are intended primarily for foreign audiences. Exclusive use of foreign satellites to distribute broadcast programming services to Canadians had not previously been allowed, and was explicitly prohibited in the 1995 policy clarification.

    For domestic telecommunications services (services between points within Canada), radio licences for an earth station operating with a Canadian satellite may be granted to anyone eligible for a licence under the Radiocommunication Act, the eligibility requirements for persons thereunder being set out in Sections 9 and 10 of the Radiocommunication Regulations. Television receive-only earth stations for the reception of broadcasting signals are generally exempt from licensing. Earth stations in Canada communicating with points in the U.S. must normally be licensed to Telesat, as Telesat's monopoly applies to Canada/U.S. transborder services. Teleglobe provides telecommunications services for Canadians by routing calls to and from foreign countries and territories other than the United States, and it continues to be the sole provider of facilities (including earth station facilities) for the provision of overseas (i.e., non-U.S. international) telecommunications services.

    There are only a few limited exceptions to the fundamental policy principle of requiring the use of Canadian telecommunications facilities. For several decades, under agreements negotiated between Canada and the U.S., licensed mobile radio users in each country have been allowed to roam across the border, and this principle has been applied to mobile terminals served by satellites. Since 1992, VSAT units can be operated in either country on the satellites of the other country. As well, transportable Satellite News Gathering (SNG) units are permitted to cross the border while retaining a link to a satellite of their home country.

    The Department, in reviewing and modifying its policies, continues to have regard to the objectives set out in Section 7 of the Telecommunications Act, to which objectives the Minister of Industry may also have regard in exercising his or her powers under the Radiocommunication Act.

  3. Definitions

    For greater certainty, the following terms are defined for the purpose of this paper.

    Canadian satellite: A satellite operated by a "Canadian carrier" as that term is defined in the Telecommunications Act, in an orbital position or orbit(s) coordinated by the International Telecommunication Union on behalf of the Canadian Administration.

    Receive-only earth station: A radio apparatus consisting of antenna and radio receiver, capable of receiving signals from a satellite operating in the space radiocommunication services.

    Transmit earth station: A radio apparatus consisting of an antenna and radio transmitter, and optionally a radio receiver, capable of transmitting to a satellite operating in the space radiocommunication services. The optional radio receive apparatus, which would be included under the same licence as the transmit apparatus, must be for the reception of signals which are directly related to the transmitted signals (for example, the return direction of a two-way voice or data link).

    Multipoint Services: Those services which operate by means of distributed or centralized intelligence which enable a communication link between any two outlying points of a multiple (greater than two) number of points not including the hub where one is used. In addition, all points in a multipoint network must share the satellite resources (bandwidth and power) allocated to the network. Examples of multipoint services are those provided by VSAT systems, or mesh and hubless systems. Examples of systems which do not meet this definition are those uniquely for point-to-point, point-to-multipoint or multipoint-to-point collection.

  4. Current Earth Station Licensing Policies

    Licensing of earth stations takes place under the Radiocommunication Act (the Act), subsection 4(1) of which provides that no person shall, except under and in accordance with a radio authorization, install, operate or possess radio apparatus, other than radio apparatus exempted under regulations made under the Act, or radio apparatus capable only of the reception of broadcasting. (For the latter exemption to apply, the radio apparatus cannot be a distribution undertaking, which is defined as an undertaking for the reception of broadcasting and the retransmission thereof, by radio waves or other means of telecommunication, to more than one permanent or temporary residence or dwelling unit, or to another such undertaking.) The authorization provided to earth station radio apparatus is generally that of the radio licence. Under subsection 5(1) of the Act, the Minister of Industry has the authority to issue radio licences and to fix the terms and conditions of any such licences. Also, under subparagraph 5(1)(a)(i.1) of the Radiocommunication Act, the Minister may issue a spectrum licence, which is an authority in respect of the utilization of specified radio frequencies within a defined geographic area; as well, the Minister may fix the terms and conditions of any such spectrum licence.

    1. Policies for Receive-Only Earth Stations

      In accordance with the provisions of the Radiocommunication Act, many receive-only earth stations can be operated under an exemption from the requirement to obtain a radio licence; those receive-only earth stations not explicitly covered by an exemption continue to require licences, which licences are issued in accordance with the policies applicable to transmit earth stations (infra). The following legislative provisions and policies specifically applicable to receive-only earth stations are currently in force:

      1. Broadcasting: a radio authorization is not required to install, operate or possess radio apparatus that is capable only of the reception of broadcasting and that is not a distribution undertaking. Reference: Radiocommunication Act, Subsection 4(1).
      2. Broadcasting undertaking: a radio authorization for a receive-only earth station used in a broadcasting undertaking can be issued where:
        1. the earth station is used for the reception of program signals that have been approved by the CRTC for distribution in Canada; and
        2. the applicant has an agreement with the provider of the program signals for redistribution of the signals.
          Reference: Radio Standards Procedure 116 (RSP-116), Issue 2, Licence Application Procedure for Planned Television and/or Radio Receive Only (TVRO) Earth Stations in the Fixed-satellite Service.
      3. Low power devices: receive-only earth stations operating with a Canadian satellite are exempt from licensing, but the Department will consider licensing such earth stations if they require protection from interference or coordination with other services.
        References:

        (1) Radio Standards Specification 210 (RSS-210), Issue 2, Rev. 1, Low Power Licence-Exempt Radiocommunication Devices.

        (2) RSP-116, Issue 2.


    2. Policies for Transmit Earth Stations

      Transmit earth stations have traditionally been subject to more rigorous licensing procedures than receive-only earth stations, both because of their potential to cause interference to other users of the spectrum and because of their network capabilities. All transmit earth stations require a licence, and applicants have usually been required not only to establish the acceptability of the earth station for operation with the satellite, but also to specify the service which the proposed earth station would provide and demonstrate conformity with all applicable telecommunications service policies. Transmit earth stations are currently licensed in accordance with the following policies:

      1. General Policy: any person eligible for a licence under the Radiocommunication Act may apply for a licence for a transmit earth station, if:
        1. the communication to be carried by the transmit earth station originates and terminates in Canada;
        2. the operation uses a Canadian satellite; and
        3. the applicant has an agreement with the provider of the Canadian space capacity for the necessary satellite capacity. Reference: Canada Gazette Notice DGTN-002-79, published 17 March 1979.
      2. Canada-U.S.: for transborder fixed satellite service operation between Canada and the U.S., using either Canadian or American satellites, the entity authorized to hold the earth station licence is Telesat.
        Reference: 1982 Addendum to the 1972 letters exchanged by Canada and the USA on the use of domestic satellites for transborder services, 24 August 1982, and the related letter from the Minister of Communications to the President of Telesat Canada, 25 August 1982.
      3. Canada-Overseas: for international fixed satellite service operation, excluding the U.S., using approved international satellites, the entity authorized to hold the earth station licence is Teleglobe.
        References:

        (1) Teleglobe Canada Reorganization and Divestiture Act, 1987.

        (2) Statement of Telecommunications Policy Respecting Teleglobe Canada, Department of Communications, November 1986.

      4. Satellite News Gathering (SNG): the use within Canada by U.S. entities of transportable earth stations operating with U.S. satellites, for SNG purposes, is permitted as follows:
        1. the SNG operation is for coverage of an event of an occasional or short-term temporary nature, to provide transborder satellite transmission of audio or television and auxiliary signals which are not intended for direct reception by the general public;
        2. licence applications for SNG purposes are to be processed expeditiously, and to facilitate processing, applications can be made in advance to resolve technical and other non-site-specific matters;
        3. the authorizations may be reviewed after a reasonable period of time to determine if the authorized Canadian satellite facility provider can meet the requirements of the U.S. SNG entity.
          Reference: Exchange of Letters between Canada and the U.S., 7 and 10 August 1992.
      5. Multipoint Services: for transborder private-line multipoint services provided by means of Canadian or U.S. fixed satellites, where the satellite to be used is covered by agreements between Telesat and U.S. satellite operators, radio licences are available for transmit/receive earth stations of the following type:
        1. earth stations in a multipoint network operating on a Canadian satellite and having points on either side of the Canada-U.S. border;
        2. earth stations in a multipoint network operating on a U.S. satellite and having points on either side of the Canada-U.S. border, if a commitment is made to make equitable utilization of Canadian satellites in accordance with a formal procedure for advising of the equitable utilization proposed and obtaining approval for it;
        3. for the connection of a multipoint network operating on a Canadian satellite with a multipoint network operating on a U.S. satellite, a single transmit/receive earth station within the U.S. satellite-based multipoint network connecting to the Canadian satellite-based multipoint network.
          Reference: Canada Gazette Notice DGTP-006-92, published 14 November 1992.
      6. Scientific, experimental and demonstration services: any person eligible for a licence under the Radiocommunication Act may apply, in respect of such services, for a licence for a transmit earth station, and such requests are considered on a case by case basis.
        Reference: RSP-114, Issue 5 (Provisional), Annex A, Licence Application Procedure for Planned Earth Stations in Space Radiocommunication Services.
  5. The GATS Agreement on Basic Telecommunications

    Consistent with Canada's commitment in the GATS Agreement, the Minister of Industry may, as of October 1, 1998, issue licences to enable entities to provide international fixed satellite services (except for services between Canada and the U.S.), within existing traffic-routing requirements for those services, in competition with the monopoly services now offered by Teleglobe. The routing of all international services (except for fixed satellite services between Canada and the U.S.) will be unrestricted as of December 31, 1999. Also consistent with that commitment, the existing monopoly of Telesat will now be terminated on March 1, 2000, and simultaneously, the traffic-routing requirement for fixed satellite services will end. Existing policies respecting DBS and DTH services are not affected by the GATS Agreement. Accordingly, as of October 1, 1998, the Minister of Industry may issue licences, pursuant to his or her authority under Section 5 of the Radiocommunication Act, to entities other than Teleglobe for earth stations that would enable the applicants to provide or to use fixed satellite services within existing traffic-routing requirements for international services, and as of December 31, 1999, such earth station licences may be issued to provide international services regardless of routing. Increased foreign investment in facilities-based telecommunications service providers will be permitted, such that fixed satellites owned and controlled up to a level of 100% by foreign service providers may be used to provide services between points in Canada and all points outside of Canada, except in the United States, as of December 31, 1999, and furthermore, fixed satellites owned and controlled up to a level of 100% by foreign service providers may be used to provide services between points in Canada and between Canada and points in the United States, as of March 1, 2000. These changes will also be implemented by the Minister of Industry through the licensing authority set out in the Radiocommunication Act. With the termination of the Telesat monopoly and the end of the traffic-routing requirement for fixed satellite services (and with the attendant GATS Agreement changes to the policy regime for mobile satellite services), Canadians will be able to access all types of competing domestic and foreign satellites (except DTH and DBS) as of March 1, 2000.

    To promote the universal availability of services in and a diversity of service providers for all regions of Canada (including northern Canada), the Department proposes to require, commencing on March 1, 2000, that any satellite used to offer fixed satellite services between points in Canada, or between points in Canada and the United States, must do so in conformity with the terms of the 1982 exchange of letters, or must be capable of offering such services in all regions of Canada, including northern Canada. Opening the Canadian satellite market to competition and new developments in satellite technology should increase satellite coverage of Canada. Accordingly, the Department will review the condition respecting the requirement for a satellite to be capable of offering fixed satellite service in all regions of Canada by March 1, 2002, with the intent of removing this condition if it is demonstrated that this condition is not required in order to ensure that an appropriate level of satellite service will be available in all regions of Canada. Service providers capable of and interested in offering services to Canadians under this condition are invited, in addition to submitting any other comments that they may wish to make in response to the questions set out in Section 6, to notify the Department of their intentions in this regard.

    Also under the authority of the Radiocommunication Act, and as of March 1, 2000, the Minister of Industry may issue licences, for satellites providing fixed satellite services from Canadian orbital positions, to Canadian carriers other than Telesat. To permit the utilization of the spectrum and orbital resources represented by the four Canadian geostationary positions and associated conventional C-Band and Ku-Band spectrum (see the Industry Canada Radio Systems Policy 002 (RP-002) entitled Policy for the Use of the Geostationary-Satellite Orbit by Canadian Satellite Networks), as well as by such future resources as those for Ka-Band advanced satellite communications facilities, an appropriate mechanism to effect the selection of Canadian satellite operators from amongst possibly competing applications will be pursued, through consultations and in accordance with the appropriate licensing process for the assignment of such scarce resources.

    To allow Canadians to access all domestic and foreign satellites (except DTH and DBS), through resellers or non-Canadian satellite operators if so desired, Bill C-17 proposes to exempt earth stations from the foreign ownership and control restrictions of the Telecommunications Act. Entities such as those which own or operate non-Canadian satellite facilities but do not maintain other Canadian transmission facilities, and resellers, will then also be able to offer complete satellite access, thereby giving full effect to the Canadian GATS commitment on market access for satellite services, which commitment includes the removal of all traffic-routing requirements (including Canada-Canada traffic) carried over satellite facilities.

  6. Request for Comments

    In order to implement revised fixed satellite service policies that fully meet the Canadian commitments made under the GATS Agreement on Basic Telecommunications, that reflect the objectives set out in the Telecommunications Act, that are cognizant of the continuing regime of earth station licensing under the Radiocommunication Act, and that support the general interests of the telecommunications industry and consumers, the Department herewith solicits comments on the following questions:

    1. Having regard to the current licensing regime, whereby the licences issued for earth stations identify the individual satellites that are to provide the corresponding space segment, are other mechanisms necessary to notify the Department of satellites which offer fixed satellite services, which are not licensed by the Canadian government, and which are to be used with earth stations in Canada?
    2. Should the Department adopt specific mechanisms in respect of satellites which provide fixed satellite services, which are operated by an intergovernmental satellite organization (such as Intelsat) or licensed by a country that is not a party to the GATS Agreement on Basic Telecommunications, and which are to be used with earth stations in Canada?
    3. Are there any provisions which the Department should adopt (over and above spectrum management allocation, and technical and coordination requirements) to ensure the absence of factors which might compromise the delivery of radiocommunication services or result in inefficient spectrum usage?
    4. What steps, if any, should the Department take to foster the "universal" coverage of all regions of Canada by existing service providers, and potential suppliers to the Canadian market, of fixed satellite services, and what (minimum) extent of geographical coverage should constitute "universal" coverage for any such purposes?
    5. Given the objectives of the Telecommunications Act, to what other factors should the Department have regard when considering licence applications associated with the provision of fixed satellite services by Canadian companies, foreign entities and intergovernmental satellite organizations?
    6. Upon the termination of the Telesat monopoly, what mechanisms should the Department employ, and what considerations should the Department have regard to, in authorizing Canadian entities to deploy satellites in Canadian orbital positions?
    7. Should different or additional authorization requirements apply to earth stations (for example, private business VSAT networks) which may be used by entities for other than common carrier purposes?
    8. Should there be any restrictions on or specific conditions applicable to the licensing of earth stations to end users or to service providers acting as resellers, in respect of the provision of overseas, transborder or domestic fixed satellite services, upon the termination of the respective applicable monopolies?
    9. Should any new provisions be made for the exemption from radiocommunication licensing of certain earth stations?
    10. Are there any other measures that the Department should implement to give full effect to those provisions of the Agreement on Basic Telecommunications that relate to a Canadian commitment made in respect of fixed satellite services?
  7. Receipt of Submissions

    The Department of Industry invites written submissions from all interested parties on the issues identified above. Submissions should be addressed to the Director General, Telecommunications Policy Branch, Industry Canada, 300 Slater Street, Ottawa, Ontario, K1A 0C8. To ensure consideration, submissions must be received on or before June 30, 1998. All submissions must cite the Canada Gazette Part I Notice publication date, title and the Notice reference number.

    All submissions received in response to the Notice will be made available, about two weeks after the closing date of this Notice, for viewing by the public during normal business hours at the Industry Canada Library, 235 Queen Street, West Tower, 3rd Floor, Ottawa, Ontario, and at the offices of Industry Canada in Moncton, Montreal, Toronto, Winnipeg and Vancouver, for a period of one year from the close of comments.

The Canada Gazette Notice and this publication are available electronically on the Internet at:

World Wide Web (WWW)

http://www.ic.gc.ca/spectrum

March 5, 1998

Michael Helm
Director General
Telecommunications Policy Branch
Date modified: