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Political Financing Handbook for Registered Parties and Chief Agents (EC 20231) – June 2019

7. Partisan Advertising Expenses for the Pre-election Period

This chapter discusses the rules for partisan advertising that a registered party conducts during a pre-election period, including how to administer expenses, and gives examples of activities. It covers the following topics:

  • What is partisan advertising?
  • What qualifies as partisan advertising on the Internet?
  • Partisan advertising expenses
  • Limit on partisan advertising expenses
  • Partisan advertising conducted by a registered party
  • Partisan advertising conducted by an electoral district association on behalf of a party

Note: The pre-election period starts on June 30 in the year of a fixed-date general election. It ends on the day before the general election is called.

What is partisan advertising?

Definition

Partisan advertising is the transmission to the public during the pre-election period of an advertising message that promotes or opposes:

  • a registered party or an eligible party, or
  • the election of a potential candidate, nomination contestant or leader of a registered party or eligible party

Advertising in the pre-election period is not partisan advertising if it promotes or opposes a political entity only by taking a position on an issue with which the entity is associated. This is commonly called issue advertising.

However, it will be partisan advertising if the ad promotes or opposes a political entity in any other way, including by showing a logo or linking to a web page that identifies the entity (see the next section).

Note: A potential candidate is someone who is selected in a nomination contest, is deemed to be a candidate because they have conducted political financing transactions, is a member of Parliament or an incumbent, or has the support of a political party to be a candidate of that party.

What it means to promote or oppose a political entity

Promoting or opposing, in relation to a registered party or eligible party, may include but is not limited to:

  • naming the party
  • identifying the party, including by its logo
  • providing a link to a web page that names or identifies the party

Promoting or opposing, in relation to the election of a potential candidate, nomination contestant or leader of a registered party or eligible party, may include but is not limited to:

  • naming the person
  • showing a photograph, cartoon or drawing of the person
  • identifying the person, including by political affiliation or by a logo
  • providing a link to a web page that does any of the above

Tagline

Partisan advertising conducted by the party, or by another entity on its behalf, must be authorized by the chief agent or another registered agent of the party. This authorization has to be mentioned in or on the message—for example, "Authorized by the registered agent of the XYZ Party of Canada."

What qualifies as partisan advertising on the Internet?

Election messages communicated over the Internet are partisan advertising only if:

  • they meet the general criteria for partisan advertising (see What is partisan advertising? above), and
  • they have, or would normally have, a placement cost (such as sponsored or boosted content)

For greater certainty, the following are not partisan advertising:

  • messages sent or posted for free on social media platforms such as Twitter and Facebook
  • messages sent by email or through other messaging services (including texts sent through a cellular or mobile network)
  • videos posted for free on social media platforms such as YouTube and Instagram
  • content posted on the party's website (the ongoing expenses for creating and maintaining a website are not placement costs)

Tagline

The chief agent or another registered agent of the party has to authorize any partisan advertising, and this authorization must be mentioned in or on the advertisement. Where the authorization statement cannot be included on the advertising message because of its size, this is acceptable if the statement is made immediately apparent to the viewer by following the link in the advertising message.

Information to be held in an online registry

Regulated online platforms (that is, websites or applications that meet certain criteria for monthly visitors or users) have to maintain a registry of political advertising.

When a registered party purchases partisan advertising online, to make sure it complies with the law, it should:

  • inform the platform that it is conducting political advertising
  • ask if the platform is regulated by the rules in the Canada Elections Act and needs information for its registry (unless the platform has already made this clear)

If the platform is regulated, the party must provide it with:

  • an electronic copy of the advertisement
  • the name of the registered agent who authorized its distribution on the platform

The platform must publish this information in its registry from the day the ad runs until two years after election day.

Partisan advertising expenses

A partisan advertising expense is an expense incurred in relation to:

  • producing a partisan advertising message
  • transmitting a partisan advertising message

It includes the following:

  • any non-monetary contribution received to the extent that the property or service is used in relation to producing or transmitting a partisan advertising message
  • a non-monetary transfer accepted to the extent that the goods or services are used in relation to producing or transmitting a partisan advertising message

Limit on partisan advertising expenses

The Canada Elections Act imposes a limit on partisan advertising expenses of registered parties for a pre-election period.

The limit for 2019 is $2,046,800. (This is the base amount of $1.4 million multiplied by the inflation adjustment factor in effect on June 30 of that year.)

The limit applies to the total of all partisan advertising expenses of a registered party, whether paid, unpaid or accepted as non-monetary contributions or transfers.

Note: Registered parties must not do anything to circumvent the partisan advertising expenses limit, including by colluding with affiliated political entities or third parties.

Partisan advertising conducted by a registered party

When a registered party conducts partisan advertising during a pre-election period, the expenses to produce and distribute the advertising are partisan advertising expenses subject to the limit, regardless of when the expenses were incurred.

If the advertising was conducted only partly within the pre-election period, the expense for distribution may in some circumstances be allocated over the different periods (for example, when advertising is charged per day).

The expense for production is never allocated over the different periods. If the advertising is conducted during the pre-election and election periods, the full production expense counts toward both limits.

Note: An eligible party that becomes registered during a fixed-date general election is deemed to have been registered from June 30. This means the party must be prepared to report on its partisan advertising and respect the partisan advertising expenses limit.

Examples
  1. From June 26 to July 5 in the year of a fixed-date election, the registered party runs a TV ad that opposes the leader of another party. The ad displays an authorization statement from the chief agent. The cost to produce the ad was $15,000, and the cost to broadcast the ad for 10 days was $20,000, or $2,000 a day. The chief agent must report a partisan advertising expense of $27,000 ($15,000 + ($2,000 x 6 days)), subject to the limit. The remaining distribution expense of $8,000 is a registered party expense not subject to a limit.
  2. In early June in the year of a fixed-date election, the registered party installs signs across the country promoting itself. The signs remain in place during the pre-election period and display an authorization statement from the chief agent. The cost to produce the signs was $15,000, and the cost to install them was $5,000. Even though the signs were installed before the pre-election period, the full expense of $20,000 is a partisan advertising expense subject to the limit. If the signs stay up during the election period, the same expense of $20,000 is also an election expense subject to the limit.

Partisan advertising conducted by an electoral district association to promote or oppose a party

An electoral district association of a registered party, whether the association is registered or not, can incur expenses and conduct partisan advertising to promote or oppose a party. This can be done without impacting its affiliated party's limit if the advertising is conducted only or mostly in the association's own electoral district.

However, if an association plans to conduct such advertising outside its electoral district, the advertising can only be done on behalf of the affiliated party, and the expenses incurred are subject to the party's limit. The association must obtain the agreement of the party beforehand. After incurring the expenses:

  • if the association is registered, the property or services that the expense is incurred for must be sold or transferred to the party
  • if the association is unregistered, the property or services that the expense is incurred for must be sold to the party

The party must receive a copy of the original supplier invoice for the partisan advertising expense. The expenses for partisan advertising conducted during the pre-election period, including the cost of production and distribution, are partisan advertising expenses of the party.

Partisan advertising done on behalf of the registered party must receive prior written authorization from a registered agent of the party. This authorization has to be mentioned in or on the message—for example: "Authorized by the registered agent of the XYZ Party of Canada."

For more information on how the partisan advertising rules apply to electoral district associations, see Chapter 7 of the Political Financing Handbook for Electoral District Associations and Financial Agents.

Examples
  1. A registered association of the party plans to produce flyers promoting the party leader and distribute them in ridings across the region during the pre-election period. Because the advertising will be distributed widely outside the association's riding, it is a partisan advertising expense of the party. The association must obtain prior written authorization from a registered agent of the party, and this authorization must be mentioned on the flyers. The association must then transfer or sell the advertising to the party. The financial agent sends an invoice to the party, along with copies of the original supplier invoices, and the party reports the production and distribution costs as partisan advertising expenses subject to the limit.
  2. A registered association of the party produces flyers promoting the party leader and mails them to households in its riding, with some overlap into adjacent ridings that share postal codes. This is not a partisan advertising expense of the registered party. The flyers display an authorization statement from the financial agent of the association, and the expenses are reported in the association's annual financial return.