File picture: AP Photo/Elise Amendola
File picture: AP Photo/Elise Amendola

Canada seeks $630m from streaming firms to fund domestic content

By Reuters Time of article published Nov 4, 2020

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By David Ljunggren

Ottawa - Canada introduced a bill on Tuesday that would strengthen the broadcast regulator and allow it to collect up to C$830 million ($630 million) by 2023 from online streaming companies such as Netflix <NFLX.O> and Amazon <AMZN.O> to fund Canadian content.

The Liberal government said the changes were needed because tech firms, which provide wildly popular online services, are exempt from rules obliging domestic broadcasters to spend a proportion of programming budgets and allocate a set portion of air time to Canadian artists.

"Our government believes that everyone who benefits from the system should contribute to it fairly," Heritage Minister Stephen Guilbeault told reporters.

The idea of strengthening the Canadian Radio-television and Telecommunications Commission (CRTC), which regulates the broadcast and telecoms sectors, was recommended by a government-mandated panel probing how to update broadcasting laws to reflect the massive growth of online services.

The bill, once adopted by Parliament, would make the major U.S. tech companies pay for domestically produced content but did not spell out exactly how.

Michael Geist, Canada Research Chair in Internet and e-commerce Law at the University of Ottawa, noted the CRTC would gain major new powers to regulate online streaming services and also fine firms it deemed to be in non-compliance.

"The bill creates considerable marketplace uncertainty that could lead to reduced spending on Canadian film and television production and delayed entry into Canada of new services," he wrote in a blog post.

Netflix and Amazon were not immediately available for comment.

The panel also recommended obliging the tech firms to collect local taxes, which the bill did not mention. Officials made clear this was an option.

"This remains an important issue for the government and ... (it) intends to move forward," an official told reporters, saying a final decision rested with the finance ministry.


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