May 31, 2018 – OTTAWA, ON – Competition Bureau
On October 17, 2017, Corus Entertainment Inc. announced it had reached an agreement to sell French language speciality channels Historia and Séries+ to BCE Inc. in a transaction valued at approximately $200 million.
Bell’s 50% interests in Historia and Séries+ were divested to Corus in January 2014. This was part of a broader remedy package in a consent agreement (the agreement) between Bell and the Commissioner of Competition to address the Commissioner’s competition concerns regarding Bell’s acquisition of Astral Media Inc. in 2013 (the Bell/Astral Transaction). The agreement was registered with the Competition Tribunal on March 4, 2013. The divestitures required by the agreement included 6 English and 7 French language specialty services. The agreement provides that Bell cannot, for 10 years, reacquire a divested programming service without the prior written approval of the Commissioner. Bell and Corus notified the proposed transaction under s.114 of the Competition Act and submitted a request for an Advance Ruling Certificate under s.102 of the Competition Act on November 13, 2017, in addition to requesting the Commissioner’s written approval under the agreement (Bell’s Request).
On May 25, 2018, the Commissioner informed Bell and Corus that he would not approve the proposed reacquisition.
The divestiture of Historia and Séries+ was part of a broader remedy package required by the Commissioner in order to ensure that a substantial lessening of competition in the market for the supply of French language television programming services to programming distributors would not result from the Bell/Astral Transaction.
In his review of Bell’s Request, the Commissioner first considered the competitive concerns that underpinned the agreement. The Commissioner then considered what changes relevant to the supply of French language television programming services to programming distributors had occurred since the agreement was registered, including changes relevant to the:
- competitive significance of Historia and Séries+;
- relevant product and geographic market definitions;
- market structure (e.g., entry by new French language programming services);
- regulatory environment; and
- cognizable efficiencies attributable to the acquisition of Historia and Séries+.
To the extent changes had occurred, the Commissioner next considered what impact, if any, these changes had on the competitive dynamic in the relevant market. Notably, the Bureau considered the growth in subscriptions to over-the-top services, such as Netflix, and determined that this change had no material impact on the competitive dynamic between programming service providers and programming distributors. Ultimately, the Bureau’s review determined that the conditions that led to the making of the agreement had not materially changed to the point where the remedy in that agreement is no longer necessary. Accordingly, the Commissioner did not approve Bell’s Request to reacquire Historia and Séries+ from Corus.