Camera operators set up to shoot a scene during the filming of the movie Hocus Pocus Christmas, in Almonte, Ont., in April, 2024.DAVE CHAN/Getty Images
An increasing number of Canadian TV and radio stations could close if the federal Online Streaming Act becomes a casualty of the trade war with the United States, industry leaders are warning.
The act, which became law in 2023 after a bitter parliamentary battle, compels foreign platforms such as Netflix to financially support Canada’s TV, film and music sectors.
Kevin Desjardins, president of the Canadian Association of Broadcasters, said if the act is shelved as a result of American pressure, it would prove a “crushing blow” to Canada’s cultural sector.
On Thursday, 27 bipartisan members of Washington’s House ways and means committee, led by Republican Lloyd Smucker and Democrat Linda Sánchez, wrote to Canada-U.S. Trade Minister Dominic LeBlanc and Kristen Hillman, Canada’s ambassador to the U.S., calling on Ottawa to rescind the act.
“While we are strong supporters of the bilateral relationship with Canada, discriminatory policies, like the online streaming act, undermine the value of the United States-Mexico-Canada Agreement,” the letter said.
“We urge the Canadian government to rescind this digital trade barrier immediately including by terminating the collection of fees,” it added.
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The act makes foreign streaming platforms promote Canadian content and pay into cultural funds, including some that support Indigenous and Black productions.
Washington this week warned that Canada will have to negotiate a new regime for foreign streamers if it wants President Donald Trump to renew Canada’s continental free-trade pact, the USMCA.
In a presentation delivered to both the Senate finance and House ways and means committees this week, and subsequently made public by his office on Wednesday, U.S. Trade Representative Jamieson Greer signalled that the Online Streaming Act was on the agenda for the forthcoming negotiations over the future of the USMCA.
Reynolds Mastin, president and CEO of the Canadian Media Producers Association, said in a statement Thursday that “it is imperative that the federal government continue to defend this important legislation.”
The offices of Mr. Leblanc and Canadian Identity Minister Marc Miller declined to comment.
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Senator Julie Miville-Dechêne, who was among the parliamentarians to scrutinize the online streaming bill during its passage, said Canadian and Quebec culture is threatened by foreign streaming platforms.
“The Online Streaming Act is a crucial, still untested attempt to promote Canadian content – music, film – on those giant platforms," she said in an e-mail. “Because it is at the heart of our culture, the Online Streaming Act should be exempted from the trade negotiations, as cultural products have been until now.”
The act, also known as Bill C-11, has not yet been fully implemented by the broadcasting regulator, The Canadian Radio-television and Telecommunications Commission.
After the act became law, the CRTC imposed a 5-per-cent levy on non-Canadian online streaming services, which it estimated could generate $200-million in revenue annually. But such payments have been challenged in court by various streaming platforms and no money has yet been paid out.
One of the funds that was set to benefit was a local news fund that helps Canadian broadcast channels.
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Mr. Desjardins said on Thursday that with advertising migrating away from broadcasters to tech giants, and people choosing streaming platforms over cable subscriptions, the industry has been under great financial pressure. He said 13 local TV stations have closed this year, with more likely to follow if the legislation is rescinded.
He accused foreign streamers of “attempting to use the trade negotiations as a hammer to maintain the status quo and remain completely unregulated and able to continue to generate billions of dollars out of Canada without having to support the Canadian media system.”
Broadcast policy expert Monica Auer said scrapping the act would leave Canada’s broadcasting sector with “even more uncertainty.”
She cautioned that the failure of the CRTC to fully implement the act could weaken Canada’s position in any trade negotiations.
“C-11 was far from perfect, but the inordinate time that the CRTC has been taking to implement its changes has very much not helped. If C-11 been implemented by May, 2025, it would have been much harder to turn back the clock,” she said in an e-mail.
“But now? With no evidence that it has helped anyone, which would have enabled Canada to defend it, why wouldn’t the U.S. demand that it be on the table?”
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The Digital Media Association, whose members include music streaming platforms, opposes the extension of Canada’s broadcasting regulations to streaming services.
Three of its members, Spotify, Amazon and Apple, last year filed legal challenges to the CRTC’s decision to impose a mandatory financial contribution through the implementation of the Online Streaming Act.
“Music streaming services already invest heavily in Canadian artists and deliver the music Canadians choose to hear, and they intend on continuing to do so. The streaming model has supported Canadian music to become a tremendous success,” Graham Davies, president and CEO, said in a statement.
“The Online Streaming Act jeopardizes that success by imposing unnecessary regulatory and financial burdens on services Canadians love and use every day.”
With a report from Adrian Morrow