The Canadian Association of Broadcasters (CAB) and media advocacy group Friends of Canadian Media are among the groups expressing concern over a lack of clarity from Ottawa on what obligations foreign streamers might face going forward.
A Federal Court of Appeal filing earlier this month confirms the Liberal government plans to completely eliminate the CRTC’s online streaming contribution framework for U.S. streamers, replacing the levy with $600 million in previously-announced taxpayer funding.
The government would scrap both the 15% increased contribution target and the original 5% base contribution requirement for foreign streaming services (which is still the subject of a challenge at the Federal Court of Appeal by companies including Amazon, Apple, Spotify and Netflix), according to the letter.
Friends of Canadian Media, which is helmed by former CRTC commissioner Raj Shoan, says it’s deeply disappointed by the report.
“If confirmed, this would represent an unprecedented interference with the work of Canada’s independent communications regulator,” wrote Shoan in a statement provided to Broadcast Dialogue. “Parliament gave the CRTC responsibility for implementing the Online Streaming Act. The Commission developed its contribution framework after years of parliamentary debate, extensive public consultation, evidence from stakeholders and sustained participation by Canada’s cultural and media sectors. The government should not now use a policy direction to predetermine a specific regulatory outcome simply because powerful foreign companies and the United States government object to it.”
“This decision would also undercut years of work by Canadian creators, producers, broadcasters, journalists, unions, public-interest organizations and ordinary Canadians who participated in the legislative and regulatory processes in good faith,” Shoan continued. “It sends a troubling message that decisions reached through an open Canadian process can be overturned when foreign corporate and political pressure becomes sufficiently intense.”
Shoan says with foreign streaming companies earning substantial revenues from Canadian audiences, they should contribute “meaningfully and predictably to the Canadian cultural and media system from which they profit.”
“Transferring that responsibility to Canadian taxpayers is neither fair nor sustainable,” he added, noting that while the government has indicated streamers may remain subject to other reinvestment obligations, the scope and value of those obligations remains unclear.
“The government must immediately clarify what obligations will remain, how much streamers will be required to contribute, and how it intends to respect the CRTC’s institutional independence. Canada’s cultural policy must be made in Canada, through transparent Canadian institutions, and in the public interest – not negotiated away behind closed doors,” he concluded.
CAB President Kevin Desjardins says he’s also concerned that despite the Attorney General’s assertions to the Federal Court of Appeal, stakeholders have yet to see the substance of any policy direction from the government.
“The language in the letter does not align with what we have heard from the government, and we believe it would be premature to reach any definitive conclusions from this administrative communication between the Court and one of the respondents,” said Desjardins. “As a respondent in these appeals, the Canadian Association of Broadcasters intends to ask the Court to see this process through to a decision on the facts of the case as presented.”
