Netflix and Other Streaming Giants Challenge Canadian Rules on News Funding

Global streaming giants including Netflix and Walt Disney Co are mounting a legal challenge against Canada’s new regulations requiring them to contribute financially to local news production.

The move comes in response to a decision by Canada’s national broadcasting regulator, the Canadian Radio-television and Telecommunications Commission (CRTC), mandating that major online streaming services allocate 5% of their Canadian revenues to support domestic broadcasting initiatives, including news generation.

The regulations, announced by the CRTC in June, aim to bolster Canada’s broadcasting system by directing funds towards local news on radio and television, as well as supporting French-language and Indigenous content. According to estimates by Reuters, these measures are expected to generate approximately C$200 million ($146 million) annually once implemented in September.

The Motion Picture Association-Canada, acting on behalf of several prominent streaming companies, has initiated legal proceedings seeking leave to appeal the CRTC’s decision and requesting a judicial review. In a legal filing, the association argued that the CRTC’s mandate lacks a clear legal basis and accused the regulator of acting unreasonably in imposing financial obligations on foreign online platforms for the purpose of news production.

“The decision does not reveal any basis for the CRTC’s conclusion that it is appropriate to require foreign online undertakings to contribute to news production,” the legal filing stated.

The CRTC, however, has chosen not to comment on the ongoing legal challenge, citing the matter’s pending status in federal court. Previously, the regulator defended its decision by emphasizing the critical need to support local news and diverse content creation within the Canadian media landscape.

Source: Reuters