Photographer: Ezra Shaw/Getty Images

Outgoing Obama Trade Chief Backs NFL in Canada Super Bowl Fight

  • Froman urges Trudeau to block live U.S. ads from his airwaves
  • Battles over lumber and wine also loom as Trump takes power

Barack Obama’s outgoing trade representative made a last-ditch appeal to Prime Minister Justin Trudeau’s government to intervene in a dispute over Super Bowl ads -- the second battle with Canada that Michael Froman escalated in his waning days on the job.

Froman wrote to Trudeau’s foreign minister, Chrystia Freeland, on Jan. 13, urging her to step in and overrule a Canadian regulatory decision to allow live U.S. Super Bowl ads to be aired this year for the first time. Canadians typically see domestic ads instead, a system Froman, the National Football League and others want to keep.

The U.S. trade representative’s term ended Thursday shortly after he challenged Canadian wine sales rules amid an ongoing softwood lumber dispute. All told, incoming President Donald Trump’s administration now finds itself with several live wires on the trade file with Canada, the top buyer of U.S. exports, as it prepares to reopen the North American Free Trade Agreement.

No event commands more attention in Canada than the National Football League’s Super Bowl. Trump appointed one of the team owners, Woody Johnson, as ambassador to the U.K.

“The United States is highly concerned and is examining all of its options with regards to this troubling policy,” Froman wrote in the letter, a copy of which was obtained by Bloomberg News. “I strongly urge the government of Canada to reverse” the decision by the regulator.

Advertising Exception

The ruling was finalized last year and will take effect for the Feb. 5 game. It’s related to legacy rules on simultaneous substitution, known as simsub, whereby Canadian ads are forced onto U.S. television feeds north of the border. The system props up advertising revenue for domestic networks, who in turn are required to use a share of it to fund Canadian programming. It’s also seen to prop up the price they’ll pay to American shows, given they can raise more money on them through domestic ads.

The Canadian Radio-television and Telecommunications Commission ruling was a populist nod to the yearly tradition of Canadian grumbling over missed high-profile ads that are a hallmark of the Super Bowl spectacle. The ruling loosens the grip of simsub just for the Super Bowl -- all other programming, including all other NFL games, will still have Canadian advertisements. Froman objected to that.

“The decision of the CRTC inexplicably and unfairly suspends simsub for only one program after decades of extending the policy to all programming,” he said in the letter. The decision “compromises the interests” of the NFL as well as Canadian broadcasters, advertisers and artists who rely on simsub to fund programming, he said. The ruling “carries negative implications well beyond this single instance.” 

Requests for comment from the trade representative’s office weren’t immediately returned on inauguration day. The U.S. consumes three quarters of Canada’s exports and total trade between the two countries was C$541 billion ($405 billion) in 2015.

League Pressure

The NFL and its Canadian rights-holder, BCE Inc. and its Bell Media unit, have filed a court challenge against the ruling and have asked Trudeau to intervene, a call echoed by Froman’s letter. He and Freeland know each other from softwood lumber talks; she was previously Canada’s trade minister before a promotion this month aimed at dealing with the Trump team more effectively.

The NFL’s legal challenge is based in part on Nafta, which Trump has signaled he’ll move quickly to reopen. Bell is pushing the federal government to use a rare executive power -- section 26 (2) of the Broadcasting Act, used only once in Canadian history on the eve of a referendum that nearly broke the country apart -- to force domestic ads back onto U.S. feeds. Froman recommended using a different section of the act that gives cabinet powers to overrule the CRTC under terms of the Canada-U.S. Free Trade Agreement, a Nafta predecessor.

Trudeau’s government has given no signal to date that it plans on intervening. Freeland’s office declined the comment on the letter. “The minister looks forward to working very closely with the new U.S. administration,” spokesman Joseph Pickerill said in an e-mail. “As the matter is now before the courts, we cannot comment any further.”

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