You may recall that on January 9 the Minister of Transport introduced to Cabinet a Bill to amend the Telegraphs Act so as to provide for the licensing of external telecommunications. The desirability of a licensing system had been accepted by Cabinet in December 1954,¹⁵⁰ when consideration was being given to the application of the Commercial Cable Company for the right to land a trans-Atlantic cable in Canada. My memorandum? to you of January 13 set forth certain objections to the Bill submitted, which had not been discussed with this Department.

At this morning's meeting Cabinet will have before it a memorandum? from the Minister of Transport requesting general guidance on the licensing question and setting forth three possible courses of action, viz:

(1) Making the proposed licensing procedure applicable to all external telecommunications, whether by trans-oceanic cable or by land line.

(2) Exempting terminal traffic between Canada and the United States but including trans-border land lines used for transmission of messages to countries other than the United States.

(3) Licensing only trans-oceanic cables.

The suggestion is made that, although a limitation of the licensing procedure to trans-oceanic cables would leave gaps in the control of external telecommunications, it would suffice for the purposes of the Department of Transport, pending a general review of the Government's communications policy and a thorough revision of existing legislation.

I would recommend that you oppose the acceptance at this time of any of these courses leading to piecemeal amendment of the Telegraphs Act, unless the Department of Transport can demonstrate that there is urgent need for licensing at this time. If there is no immediate urgency I can see no reason why the necessary comprehensive review of communications legislation could not be carried out in the course of the next few months. It is quite possible that when the whole question has been examined by the interested departments the agreed recommendations to Cabinet would include licensing provisions along the lines now being considered. At the moment, however, we are not in a position to determine which, if any, of these particular suggestions would be appropriate as we have not had an opportunity to weigh their implications. We also consider that an amendment of the Telegraphs Act limited to the question of licensing external telecommunications would invite the criticism of Mr. Gordon McLaren and others connected with the application of the Commercial Cable Company that the Government was unsure of its right to handle that application as it did.

In the event that Mr. Marler does consider that there is an urgent need for licensing and that in consequence the Telegraphs Act should be amended to provide only for this, I would recommend that a decision be deferred until the question has been discussed between departments at the official level. We would much prefer, however, to deal with it as part of a general review.

We would not wish to give the impression that we were opposed to licensing per se as we have agreed on the desirability of measures of this sort. What we have our doubts about is the timing and procedure proposed by Transport.

J. L[ÉGER]