In This Story
The Motion Picture Association-Canada (MPA-Canada), which represents Netflix, Disney+, Paramount, and other streamers, has asked the country’s Federal Court of Appeal to review a new rule that would require streaming companies to pay the Canadian government a cut of their revenues.
The Canadian Radio-television and Telecommunications Commission (CRTC) announced the new rule in June, which requires online streamers to contribute 5% of their revenues generated in the country to support content produced in Canada.
The rule follows up on the Online Streaming Act that was passed by the Canadian parliament in 2023 and tasked the CRTC with modernizing the country’s broadcasting system.
“The CRTC’s decision to require global entertainment streaming services to pay for local news is a discriminatory measure that goes far beyond what Parliament intended, exceeds the CRTC’s authority, and contradicts the goal of creating a modern, flexible framework that recognizes the nature of the services global streamers provide,” said MPA-Canada President Wendy Noss in a statement.
Noss added that streamers “do not produce local news nor are they granted the significant legal privileges and protections enjoyed by Canadian broadcasters in exchange for the responsibility to provide local news.”
The rule would go into effect starting with the 2024-2025 broadcasting year, which starts this fall. The fees would provide an estimated $200 million in new funding every year, according to the commission.
The CRTC said in a news release at the time that the extra cash would be used to fund “areas of immediate need in the Canadian broadcasting system” such as local news, content in French, and indigenous content. Streaming companies will also have some say in where their contributions are directed, according to the release.
The new rule applies to online streaming services that generate at least $25 million in revenue in Canada and are not affiliated with a Canadian broadcaster. Revenue derived from podcast, video game, and audio book services are exempt.