Canada's new magazine legislation goes to third reading

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OTTAWA--The Canadian federal government is one step closer to passing new legislation meant to dissuade foreign publishers from going after Canadian advertising dollars in so called "split-run" magazine editions. These are magazines that publish primarily foreign content but are split off from their parent publication to be marketed directly to a Canadian audience.

Bill C-55 is expected to go to a third reading this week, and will then be reviewed by the Canadian Senate, prior to being passed into law.

However, the Association of Canadian Advertisers has continued to protest the impending new legislation, arguing the Bill does not adequately address concerns about Canadian culture, but rather has focused on disallowing Canadian advertisers to buy advertising in these "split-run" publications.

The ACA has put forward a number of alternative proposals to Sheila Copps, Minister of Canadian Heritage, under whose jurisdiction this legislation was proposed.

The ACA suggests, for instance, that a minimum Canadian content rule be implemented that would be standard for all publications being marketed distinctly to a Canadian audience. This would not affect U.S. or other foreign publications that are freely for sale in Canada, just the ``split-run" editions.

Other suggestions include developing a pricing framework based on home-market rates to stop foreign publications from underselling advertising rates in Canadian magazines -- a key concern to the Canadian Magazine Publishers Association.

"We are extremely disappointed that this bill is proceeding to Third Reading," said Ron Lund, president-CEO of the ACA. "It seems peculiar that there should be such a rush to have this legislation pass when, at the same time, representatives from both Canada and the U.S. are negotiating options to the bill."

The World Trade Organization may also have a final say on new Canadian legislation as a complaint from the U.S. against previous legislation concerning "split-run" magazines was upheld, with the WTO advising Canada that, while its attempts to protect culture were acceptable, the measures the Canadian government then had in place to penalize foreign publishers were not.

Exempt from the new rules are Time, Reader's Digest and other magazines with Canadian issues in place before efforts to curb split-run titles began.

Copyright March 1999, Crain Communications Inc.

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