The Canadian government plans to instruct the broadcast and telecommunications regulator to reconsider its recent decision to triple the financial contributions that streaming platforms such as Netflix must allocate to Canadian content. The Heritage Department expressed concerns that the increased requirements imposed by the Canadian Radio-television and Telecommunications Commission (CRTC) could lead to higher costs for Canadian consumers. Prime Minister Mark Carney emphasized the need to avoid raising expenses for Canadians during a meeting with his cabinet.
To address the situation, the government announced a $600 million investment aimed at providing immediate support and stability to Canada’s audio and audiovisual sectors, ensuring that Canadian culture remains accessible and affordable. The Online Streaming Act, enacted in 2023 under the previous Trudeau government, empowered the CRTC to mandate that streaming companies generating at least $25 million in annual Canadian revenue allocate a portion of their earnings to support Canadian content creation, including films, TV shows, and local news.
Initially, the CRTC set the base contribution at five percent of a company’s Canadian revenue but increased it to 15 percent last month. Consequently, Ottawa will issue a new policy directive to the CRTC to modify the implementation of the Online Streaming Act. Notably, the law has been identified as a trade irritant by the Trump administration as both countries review their free trade agreement.
The Motion Picture Association, representing U.S. streaming platforms, urged the cabinet to reconsider its stance. U.S. Ambassador to Canada Pete Hoekstra welcomed the decision to review the increased contribution, emphasizing the importance of a fair and supportive framework for American firms to invest in Canada’s creative sector.
Despite not having the authority to directly overturn regulatory decisions, under the Broadcasting Act, the cabinet can guide the CRTC on the general implementation of the act. In response to queries, the CRTC indicated its awareness of the government’s intention to adjust the implementation of the Online Streaming Act. Culture Minister Marc Miller acknowledged the industry’s financial challenges and the significance of supporting it, indicating that platforms will still be required to contribute to Canadian content.
Miller mentioned that the government is evaluating its upcoming directive to the CRTC without divulging specific details but assured that platforms will retain their responsibility to support the sector. He clarified that the review coinciding with U.S. trade negotiations was coincidental, according to his interview with CBC’s Power & Politics.
