Dogwoods bloom around the U.S. Capitol Building in Washington on Tuesday.Heather Diehl/Getty Images
A Canadian law that requires Netflix and other major streaming services to promote Canadian content and financially support the country’s creative industries was the target of a renewed attack in the U.S. Congress Thursday, where Republicans launched a bill that could ultimately lead to the imposition of fresh tariffs.
Republican Representative Lloyd Smucker, a member of the ways and means trade subcommittee, introduced a bill designed to counter Canada’s Online Streaming Act by investigating whether it discriminates against or unfairly burdens American companies.
If passed, the U.S. bill, titled the Protecting American Streaming and Innovation Act, would launch a probe under Section 301 of the 1974 Trade Act to identify unfair trade practices. If the investigation finds American companies are being discriminated against, the United States Trade Representative would be directed to take retaliatory action, which could include tariffs.
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The Online Streaming Act, which received royal assent in 2023 but has yet to be fully implemented by the Canadian Radio-television and Telecommunications Commission, the broadcasting regulator, is the subject of multiple legal challenges and has been criticized by members of Congress before.
The bill updates Canada’s broadcasting law to include major foreign streaming platforms such as Amazon’s Prime Video and Apple Music, imposing obligations on them to promote Canadian music, film and TV while paying to support those sectors.
Canadian cultural industries, particularly in Quebec, say that the bill is important to ensure that the domestic sector is supported and not swamped by American content. But the bill is regarded as a “trade irritant” in Washington and is being discussed in trade negotiations between Canada and the U.S.
“Digital trade plays a critical role in America’s economy, supporting high-paying jobs and exporting American values,” Mr. Smucker said in a statement. “Canada’s unfair policies stack the deck against U.S. companies, creators and workers. This bill would protect American creators and companies while permitting mutually beneficial competition and innovation.”
In the United States-Mexico-Canada Agreement on free trade, as in previous agreements with the U.S., Canada obtained an exemption for measures relating to a cultural industry, including the production, distribution, sale or exhibition of film or video recordings.
Nevertheless, U.S. trade officials and members of Congress have previously said that the Online Streaming Act discriminates against U.S. streaming giants.
Mr. Smucker’s bill argues that the cultural exemption may not apply to digital streaming, as the definition of a “cultural industry” predates those services.
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Kevin Desjardins, president of the Canadian Association of Broadcasters, has warned that if the Online Streaming Act is shelved as a result of American pressure, it could be a crushing blow to Canada’s cultural sectors.
He said in a statement that the U.S. bill “is just another in a long line of tricks and machinations unleashed by the foreign streamers to allow them to continue to take billions of Canadian dollars out of our economy while gutting our domestic media industry.”
The U.S. bill was welcomed by the Digital Media Association, a trade group representing music streaming companies, including Amazon, Apple, YouTube and Spotify.
“Implementation of Canada’s Online Streaming Act continues to be a significant source of concern to our members, as it discriminates against non-Canadian, and especially U.S. companies, jeopardizes investments and imposes new and undue burdens on music streaming services,” said Graham Davies, the association’s president and chief executive.
The Motion Picture Association, whose members include Disney, Netflix, Paramount and Amazon, also welcomed the U.S. bill. In 2024, MPA-Canada launched a legal challenge to a CRTC decision requiring major global streaming platforms to contribute 5 per cent of their Canadian revenue to funds supporting local news and Canadian programming.
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Charles Rivkin, the association’s chairman and CEO, said in a statement that although “Canada and its audiences are important to our member studios and the broader industry,” the Online Streaming Act “disadvantages American companies and undermines competitiveness by requiring streaming companies to subsidize and promote Canadian content over their own productions through discriminatory obligations that Canadian broadcasters do not face.”
Dominic LeBlanc, the minister responsible for Canada-U.S. trade, is leading negotiations with the United States on behalf of the federal government. His office declined to comment.
Michael Geist, the University of Ottawa’s Canada Research Chair in internet and e-commerce law, said in a post on X that “the U.S. Congress isn’t messing around with the proposed legislation targeting Canada’s Online Streaming Act” as it “mandates retaliation if the law remains on the books unchanged.”