Edited Rule:

C 3.2 School Subscriptions Educational Programs

A newspaper may include as a sub-category of “Verified Circulation” tThe classification "Newspapers in Education" "Eduational Programs" in Bureau reports may be shown at the option of the publisher and if shown shall include only copies (either subscriptions or single issue sales) ordered for delivery to schools. Copies may be purchased individually by the recipients or paid for by schools or out of classroom funds.

In cases where qualified copies are paid for by sponsors, it may be acceptable for payment to be made directly to the publisher from the sponsor if other supporting documentation confirming usage (i.e., affidavits from schools, verification of delivery and receipt, etc.) is available for auditor review.

This circulation shall be shown as a sub-category of Verified in Other Paid Circulation (and in the appropriate geographic zone (e.g. City Zone, Newspaper Designated Market, etc.) as applicable) or Newspapers in Education and shall qualify as paid circulation provided copies served conform to Bureau rules defining paid circulation in all other respects.

A complete explanation including the manner in which the copies are paid for shall be shown in the paragraph devoted to general explanations in Publisher's Statements and Audit Reports.

(a) From time to time daily newspapers run a series of articles on a specific subject. Copies purchased by a sponsor or group of sponsors in excess of the recurring daily school copies for the period that the articles are featured do not qualify under the category Newspapers in Education but instead should be classified as Third Party Sales in Bureau Reports.

(b) Distribution of copies outside of structured classroom settings may also qualify as paid circulation, and reported as NIE - Home Delivered for newspapers published outside of Canada, and as NIE for newspapers published in Canada in Bureau Reports provided the following conditions are met:

(1) The copies are served in conjunction with a formal program designed to encourage literacy and continuing education of the participating student by assisting the student family to improve their life and job skills.

(2) The program in question establishes minimum participation standards for the student family, and the student family achieves those minimum standards.

(3) Auditable records demonstrating the student's enrollment in school, the program in question, completion of minimum participation standards, and sufficient funding to support copies distributed are maintained.

(4) Only one copy per participating student family household may be claimed as paid.

(5) Schools and classrooms offering home delivered copies must also participate in NIE programs requiring classroom usage of the newspaper.

(6) School subscriptions (both subscriptions and single-copy sales) qualify as paid circulation, providing copies served conform to all Bureau rules defining paid circulation in all other respects.

(7) This classification of circulation shall not exceed five percent of average paid circulation.

New Rule:

C 3.2 Educational Programs

A newspaper may include as a sub-category of “Verified Circulation” the classification "Educational Programs" and if shown shall include only copies ordered for delivery to schools.

Edited Rule:

(The amount used for the purchase of newspapers must be in accord with Rule C 1.1 Paid Circulation Defined and use the NIE pricing model as described at www.accessabc.com to determine the minimum unit cost, net of all other considerations.)

(a) Third-Party (bulk) Sales are copies or subscriptions purchased in quantities of 11 or more that promote the professional or business interests of the purchaser.

All copies or subscriptions purchased in quantities of 10 or less will be designated as a “single-copy sale” or “home-delivery” in ABC Publisher’s Statements and Audit Reports, except as noted in section (b).

Eligible third-party purchasers must market their products or services directly to consumers. Organizations, such as advertising agencies, marketing companies or similar firms are not eligible third-party purchasers.

(b) All copies purchased by hotels, restaurants, airlines and rental car agencies for free distribution to their guests and by sponsors for free distribution to hospital patients and nursing home residents, regardless of the number of copies, will be reported as Third-Party Sales when at least 25 percent of the basic price is paid, either in cash or by applicable barter. Evidence of this payment must be recorded and made available to ABC auditors.

(c) Third-Party Sales copies served in arrears will be excluded from paid circulation and included in unpaid distribution.

(d) There are two types of Third-Party Sales — direct and sponsored. The relevant category depends upon how the newspaper receives funds from these sales.

For a guide for classifying Third-Party Sales into categories, consult ABC’s Web site: www.accessabc.com.

(1) Direct Third-Party Sales
Direct Third-Party Sales are defined as those sales involving the solicitation of funds from a single purchaser of newspapers who controls all aspects for a specific event (e.g. fundraising event, social function) or distribution program.

(2) Sponsored Third-Party Sales
Sponsored Third-Party Sales are defined as those sales involving the solicitation of funds from more than one purchaser (sponsor) for contribution to a specific program.

(a) The total average Sponsored Third-Party Sales circulation must not exceed two percent of the average paid circulation over the Publisher’s Statement period. Copies in excess of two percent will be deducted from paid circulation and included in non-paid circulation.

(b) Each individual Sponsored Third-Party Sales program (e.g. Meals on Wheels, a sporting event, a festival) with average circulation of 250 or more copies per issue will be annotated in ABC reports with an explanatory note.

When the “Third-Party Sales” purchaser (Direct Third-Party Sales or Sponsored Third-Party Sales) is an advertiser, and the transaction provides advertising, the sales may qualify as paid circulation provided one of the following three stipulations are met.

(i) The advertising agreement and newspaper purchase agreement are shown on separate contracts, or

(ii) The advertising agreement includes specific language regarding the newspaper purchase price within the contract when the agreement includes both advertising and newspapers; or

(iii) The purchase price of the newspapers is a separate itemized line item within the contract or invoice when the agreement includes both advertiser and the newspaper.

(e) Requirements

(1) Notification

(a) Recipient
Recipients must be advised that the copies are made available by the purchaser. Here is an example of acceptable notification:

• Sponsor name
• Non-promotional logo
• Address
• City, State, ZIP
• URL
• Telephone/Fax/Email

Additional information will be considered advertising and must be paid for as described in paragraph (d) above. For notification language, consult ABC’s Web site: www.accessabc.com.

Recipients of programs extending for longer than one month must receive initial notification that furnishes all information necessary to cancel delivery. These recipients must receive monthly notification of the sponsor’s identity.

(b) ABC must be notified of any Third-Party Sales program at least two weeks (14 days) in advance of distribution. This allows real-time testing as part of the audit process. Failure to provide the required notification will disqualify the circulation as “paid.”

For Third-Party Sales copies delivered to non-subscribers, newspapers must maintain a list of recipients by address or be able to define the geographic area in which they will distribute and quantify the number of households that will receive copies. This information must be available at least two weeks before the actual distribution date and be maintained for review by an ABC auditor.

(2) Content
At a minimum, the newspapers distributed as Third-Party Sales must be the same core product (editorial, classified, inserts, etc.) delivered to all other single copy and/or rack outlets in the same zone on the same date of delivery with the exception of freestanding inserts (FSI) advertising. Unique editions may not be used for Third-Party Sales. Electronic editions may be subject to the limitations shown in paragraph (f) below.

(3) Price Qualification
A qualifying price must be paid by the sponsor for each copy sold, net of all other considerations. Associated costs must be identified separately when sold in conjunction with an advertising contract for copies to qualify as paid circulation. Newspaper members may use any of the three following methods for disclosing the cost of the newspapers:

(a) Both the advertising and newspaper purchase agreements must be shown on separate contracts.

(b) When the agreement includes both advertising and newspapers, specific language regarding the newspaper purchase price (copies, unit cost and total cost) within the contract must be included.

(c) When the agreement includes both the advertiser and the newspaper, the purchase price of the newspaper must be a line item.

The amount charged for the advertising must be the same as that charged to a similarly-situated advertiser that does not purchase newspapers.

For an example of a qualified disclosure and minimum requirements to qualify a price for third-party sales, consult ABC’s Web site: www.accessabc.com.

(4) Billing
The purchase transaction must be separate from any other financial agreement between the third-party purchaser and the newspaper. An independent line item for the cost of the newspapers must appear either on the contract (if sold with a package) or on the invoice to the purchaser and indicate rate, volume and total cost for the newspapers. A clear audit trail must be maintained from the invoice/contract to the circulation records.

(5) Payment

(a) At the time of distribution, a newspaper must have sufficient funds on deposit to cover the cost of distributing the newspapers claimed as Third-Party Sales. If sufficient funds are not available, the copies may not be included as "paid" circulation. Third-Party Sales are not eligible for inclusion in the four percent allowance.

(b) Payment by Barter

(i) Bartered goods and services must have a predetermined value that can be validated with supporting documentation. Goods and services are acceptable forms of currency (replaces cash in the transaction) for Third-Party Sales. In addition to the billing requirement below, the revenue and expenses with respect to the bartered goods/services must be reflected in the accounting records of both the publisher and the sponsor in accordance with Generally Accepted Accounting Principles (GAAP).

A clear audit trail supporting the value of the bartered goods/services must be shown within the publication’s accounting system.

For additional information regarding Barter Attestation Requirements, consult ABC's website.

Programs using barter must be accompanied by a written statement, dated prior to the distribution of the newspaper from the third-party purchaser's CEO, CFO or from another representative in a management position who has knowledge of the company's financial recordkeeping process and can certify that the full barter value has been/will be recorded as an expense in accord with GAAP.

For an example of an acceptable statement, consult ABC's website: www.accessabc.com.

Barter will not be considered acceptable payment unless the affidavit is dated prior to the actual distribution of the Third-Party Sale newspapers and made available to the ABC auditor upon request.

Third-Party Sales paid for by barter must be broken out in Bureau reports. Consult ABC’s Web site.

(6) Execution
The purchaser must direct the newspaper distribution to a specific Third-Party Sales program.

The purchaser may not contribute to a “general” third-party fund, but rather must donate to a specific program or event (e.g. Meals-on-Wheels, a sporting event, or a festival).

The number of newspapers purchased, the rate charged and the total charge must be clearly indicated to the purchaser (net of all considerations as stated in “Billing”).

Money donated to Newspapers in Education (NIE) programs cannot be transferred to Third-Party Sales and vice versa.

(7) Delivery on Date of Issue
Third-Party Sale copies must be delivered on the date of issue.

New Rule

C3.3 Other Verified Distribution

(a) Home Delivery - Requested
Copies delivered to households based on a request from the household for delivery may be reported as: Verified Home Delivery – Requested under the following conditions:

1. Distribution occurs for at least 12 weeks

2. A member of the recipient household specifically requested delivery of the frequency being delivered, and requests are renewed at least annually if delivery duration equals or exceeds one year)

3. Records are available for the auditor to confirm the request

(b) Home Delivery – Targeted
Copies delivered to households may be reported as Verified Home Delivery – Targeted under the following conditions

• Households targeted for delivery are notified on the first day of delivery
• Notification includes anticipated dates of delivery
• Notification must include options for household members to contact the publisher to ‘opt-out’ of delivery
• Publishers must maintain route lists of all targeted- delivery programs and, if requested by the auditor, provide copies to ABC at least two weeks prior to the commencement of a program. Failure to provide requested audit documents will result in the exclusion of the copies from Verified circulation claims.

(c) Other Verified Distribution
In addition to Employee and Educational Program copies as noted in rules C3.1 & C3.2, distribution to the following venues may be included in “Verified Circulation” provided each location makes a specific request for delivery. The request should include an acknowledgement by the requestor that the copies are intended for use by patrons.

Hospitals & Nursing homes –
Resturants –
Doctor / Dentist offices –
Other ‘public place’ locations (e.g. barber shops, salons, etc.)
Airlines –

In addition, copies to be distributed through retail outlets will be eligible for inclusion in Verified circulation provided the retailer makes a specific request for the number of copies and the copy counts represent reoccurring distribution to patrons

No other single copy distribution is eligible to be reported as verified circulation

Edited Rule:

(a) All copies or subscriptions purchased in quantities of 2 or more by corporations, institutions or individuals for employees, subsidiary companies or branches shall be designated in Bureau reports asmay be included in paid circulation as an element of “Paid Business / Traveler Circulation, Group (subscriptions by Businesses for Designated Employees) Other Paid Circulation" provided either:

(1) The newspaper has records indicating names or titles of the employees, or

(2) Subscriber records are available for Bureau verification indicating the names or titles of those receiving the newspaper.

(b) "Group (Subscriptions to Businesses for Designated Employees)" shall be reported separately in Publisher's Statements and Audit Reports in Paragraphs 1 and 2.

(c) An explanation of "Group (Subscriptions to Businesses for Designated Employees)" shall be made in the paragraph devoted to general explanations of Publisher's Statements and Audit Reports and the range of sales stated as follows: "sold in quantities of ________ to ________."

C Traveler (Hotel) Copies
All copies purchased by hotel guests as described in this rule and / or purchased by hotels for distribution to guest rooms may be included in paid circulation as an element of “Paid Business / Traveler Circulation, Hotel Distribution.” Copies allocated to this category shall be further classified as follows:

“Guest Refund based” – copies distributed to guest rooms wherein the guest is notified upon check –in that a specified amount is included in the price of the room for the newspaper and that amount will be refunded should the guest elect not to receive the newspaper.

“Purchased by hotel” – copies intended for distribution to guests

New Rule:

C 3.4 Businesses/ Traveler Copies

(a) All copies or subscriptions purchased in quantities of 2 or more by corporations, institutions or individuals for employees, subsidiary companies or branches may be included in paid circulation as an element of “Paid Business / Traveler Circulation, Group (subscriptions by Businesses for Designated Employees)" provided either:

(1) The newspaper has records indicating names or titles of the employees, or

(2) Subscriber records are available for Bureau verification indicating the names or titles of those receiving the newspaper.

C Traveler (Hotel) Copies
All copies purchased by hotel guests as described in this rule and / or purchased by hotels for distribution to guest rooms may be included in paid circulation as an element of “Paid Business / Traveler Circulation, Hotel Distribution.” Copies allocated to this category shall be further classified as follows:

“Guest Refund based” – copies distributed to guest rooms wherein the guest is notified upon check –in that a specified amount is included in the price of the room for the newspaper and that amount will be refunded should the guest elect not to receive the newspaper.

“Purchased by hotel” – copies intended for distribution to guests