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Independent Production Protocol Independent Production Protocol Terms of Trade Guidelines for Independent Producers of English-language television programs intended for broadcast by CBC or CBC Newsworld September 2002 i TERMS OF TRADE CONTENTS 1. Preamble 2. Definitions 3. Shared Aims and Obligations 3.01 CBC’s Aims 3.02 CFTPA’s Aims 3.03 Rights in Programs 3.04 The Importance of Independent Producers to the CBC 3.05 The Importance of the CBC to Independent Producers 3.06 In-House Production 3.07 In-House Production and Independent Production 3.08 Certification 3.09 Third-Party Obligations 4. Methods of Contracting - An Overview 5. Development 5.01 Submission of Proposals 5.01.01 The Process 5.01.02 Stage of Development 5.01.03 Proposal Contents 5.02 Development 5.02.01 Development Budget 5.02.02 Development Contract 5.02.03 Materials and Schedule 5.02.04 Rights 5.02.05 Creative Approval 5.02.06 Option Period 5.03 Green Light 5.04 Red Light 5.05 No Obligation 5.06 Development Prior to Submission 6. Acquisition of Independently Produced Programs 6.01 Definition 6.02 Licence Fee 6.03 Preparation of Contracts 6.04 Conditional Provisions ii 7. Independent Productions 7.01 Definition 7.02 CTF Guidelines 7.02.01 Compliance 7.02.02 Non-Compliance 7.03 Commissioning 7.04 Broadcast Letter 7.05 The Licensed Independent Production Contract 7.06 Budget and Cash Flow 7.06.01 Production Budget 7.06.02 Budget Approval 7.06.03 Cash Flow 7.07 Financing 7.07.01 Financing Structure 7.07.02 Underages 7.07.03 Overages 7.08 Completion Guarantee 7.09 Conditions 7.10 CBC's Financial Participation 7.10.01 CBC's Contribution 7.10.02 CBC's Cash Payments 7.10.03 CBC Facilities 7.10.04 CBC Equity 7.10.05 Reporting Requirements 7.11 Approvals 7.11.01 Documentation 7.11.02 Creative 7.12 Production and Post-Production 7.12.01 Presence During Production 7.12.02 CBC Representative 7.12.03 Approvals During Production 7.13 Consultation and Dispute Resolution for Creative Issues 7.14 Final Delivery 7.15 Rights 7.15.01 General Provisions 7.15.02 Third Party Rights 7.15.03 French-Language Rights 7.15.04 Newsworld Rights 7.15.05 Distribution 7.16 Holdbacks 7.17 Publicity iii 8. Other Methods of Contracting 8.01 Introduction 8.02 Pre-sale 8.02.01 Definition 8.02.02 Conditions 8.02.03 Licence Fee 8.03 Barter 8.03.01 Definition 8.03.02 Licence Fee 8.03.03 CBC Facilities and Services 8.03.04 CBC Billboard and Commercial Airtime 8.04 CBC Funded Commission 8.04.01 Definition 8.04.02 CBC's Contribution 8.04.03 Budget 8.04.04 Rights 8.04.05 Creative Approval 9. CBC In-House Production 9.01 Definition 9.02 CBC's Rights 9.03 Independent Opportunities 10. Regions 10.01 General 10.02 CTF and The Regions 10.03 CBC Regional Offices 10.04 Production with CBC Regions 10.05 The TransCanada Fund 11. Review and Dispute Resolutions 11.01 Standing Committee 11.02 Frequency of Meetings 11.03 Primary Function 11.04 Individual Disputes 12. Fair Dealing 1 ARTICLE 1 - PREAMBLE About this Protocol... This Protocol sets out guidelines to be normally followed by the Canadian Broadcasting Corporation ( "CBC" ) and independent television producers ( "Producers" ) for the production and exploitation of English-language television programs intended for broadcast by CBC or CBC Newsworld. This Protocol is intended to increase the transparency of the relationship between CBC and Producers. We note that in the CBC’s licence renewal (Public Notices CRTC 2000- 1, 2000-2, and 2000-3), the Commission stated: “...the CBC and the Canadian Film and Television Production Association (CFTPA), have been working towards the formalization of a “Terms of Trade” agreement which will govern the relationship between the Corporation and independent producers. The public broadcaster should be a model for others in respect of its dealings with independent producers. Its plans should be transparent, in order to foster collaboration with the independent production industry. The Commission anticipates that this agreement will ensure a mutually satisfactory relationship between these two important sectors of Canadian cultural life.” CBC and individual Producers will negotiate individual contracts with each other in good faith. This Protocol will serve as a starting point and reference guide for completing contracts. However, because individual contracts are open to negotiation, this Protocol is not intended to be legally binding on specific negotiations, and exceptions to the guidelines set out in this Protocol will occur. This Protocol has been negotiated on behalf of the Canadian English-language television production community by the Canadian Film and Television Production Association ("CFTPA" ), but it is intended to be applicable to all independent television producers, including those who are not members of the CFTPA. Further Information... Detailed and reasonably up-to-date information is available at a special CBC website created specifically for the English-language independent television production community, at www.indiepro.cbc.ca (the "Website" ). The Website contains information including: submission policies, guidelines and additional information from each of ٠ the CBC areas responsible for ordering independent productions, namely: Arts & Entertainment ٠ Arts, Music, Science & Variety ٠ Children's and Youth ٠ Dramatic Series ٠ Movies and Mini-Series ٠ 3 ARTICLE 2 - DEFINITIONS Terms that are required for this Protocol are defined in the body of the text. Both parties acknowledge that different agencies may define terms differently. ARTICLE 3 - SHARED AIMS AND OBLIGATIONS 3.01 CBC's Aims CBC is accountable under the Broadcasting Act to the Parliament of Canada and ultimately to its viewers, the people of Canada. This accountability requires that CBC must act appropriately as stewards of public monies, and this will be reflected in all CBC business practices. CBC is committed to programming that is distinctive in that it reflects Canada and its regions and contributes to Canadian cultural expression and shared national consciousness and identity. In particular, CBC is committed to, among other things: (a) fulfilling its public service mandate as Canada's national public broadcaster; (b) providing programming of interest to all Canadians; (c) providing a pan-Canadian reflection throughout CBC programming; (d) providing a distinctive reflection of the country's various regions; (e) providing Canada's premier news and information service; (f) providing a special emphasis on children's, youth, arts programming and documentaries; and (g) continuing to build its strength in Canadian drama, comedy, prestigious special projects, and the showcasing of Canadian talent. 3.02 CFTPA’s Aims The CFTPA is committed, through its members to, among other things: (a) nurturing and stimulating the creation of film, television, internet productions and other interactive media; (b) ensuring the production of programming which is of interest to all Canadians and which distinctly reflects the country's various regions; (c) showcasing Canadian talent and providing children’s, youth and arts programming, documentaries, distinctively Canadian drama, comedy, and prestigious special projects; (d) creating an environment that promotes a diversity of expression and protects the rights of Canadian Producers here and abroad; (e) encouraging a stable and coherent economic environment for Producers here and abroad; and (f) enhancing international market opportunities and partnerships for Canadian- content producers. 4 3.03 Rights in Programs CBC recognizes the importance to Producers of the rights in the programs they produce, and their desire to ensure that such rights are fairly remunerated and fully exploited. Given the high volume of independent programming broadcast by CBC, CFTPA in turn recognizes CBC's need to acquire sufficient exclusive telecast rights in such programming so as to render CBC's schedule distinctive from that of other Canadian broadcasters. These guidelines aim to ensure that the funding which CBC provides, in return for the rights it is granted, fairly reflects the value of such rights to CBC, and that both parties are adequately compensated for the risks they have taken. 3.04 The Importance of Independent Producers to the CBC CBC recognizes the important contribution that Producers make to CBC and its viewers in fulfilling its commitments. CBC acknowledges that Producers make possible much of the programming which CBC must make available as part of its mandate, including, among other things: pan-Canadian and distinctive regional programming; children's, youth, and arts programming and documentaries. In this regard, the parties acknowledge that the majority of CBC's English-language programming (excluding news and investigative journalism) is currently obtained from Producers. 3.05 The Importance of the CBC to Independent Producers Producers recognize the important contribution that CBC makes to Producers’ exploitation of their projects: a) in Canada’s small market, CBC is the primary exhibitor of distinctive programming; b) CBC licences trigger outside funding; and c) CBC licences trigger outside confidence in a project. 3.06 In-House Production CFTPA acknowledges that CBC's mandate as Canada's national public broadcaster requires CBC to have ownership and control of selected programming. Accordingly, it is important for CBC to retain a significant capability for in-house CBC production, particularly in light of the emerging technologies, the resulting industry consolidations, the constantly shifting funding climate for Producers and the need,
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