Company Town : U.S. Begins Probe of Canada’s Cutoff of Broadcaster

U.S. trade officials stepped up pressure on the Canadian government on Monday to reverse the expulsion of a Nashville-based broadcaster from Canadian cable television systems by making the first move toward retaliation.

Trade Representative Mickey Kantor, in a strongly worded announcement, launched an investigation of the trade practices of the Canadian Radio-Television Telecommunications Commission under Section 301 of the 1974 trade act. The process could lead to action against Canadian businesses operating in the United States. Kantor’s move stems from a decision by the CRTC, the principal cable regulator in Canada, to drop Country Music Television of Nashville from all Canadian cable systems effective last Jan. 1. In its place, cable systems can program New Country Network, a new Canadian-owned company with the same country-western music video format as the U.S. broadcaster.

Group W Satellite Communications, which markets and is part owner of Country Music Television, has vigorously protested the decision as confiscatory. Country Music Television had operated in Canada for 10 years and had 1.9 million Canadian subscribers at the time of the cutoff. The action does not affect the channel’s 25 million U.S. subscribers.

Canadian officials have said that Country Music Television was advised in 1984 that its broadcasting privileges could be revoked if a Canadian-owned competitor emerged.

In his announcement, Kantor also cited recent Canadian moves to curtail publication of a Canadian edition of Sports Illustrated and to levy a new tax on audiotape as further evidence of discrimination against U.S. entertainment interests.

The moves are portrayed by Canadian officials as measures to protect Canadian cultural institutions from being devoured by U.S. competitors.