The Canadian government has unveiled draft regulations outlining its plan to enforce the controversial Online News Act, which mandates that social media giants pay news organizations for content shared on their platforms.
This announcement coincides with Meta, the parent company of Facebook and Instagram, continuing to enforce a news ban in Canada as a response to the legislation.
The proposed regulations, announced on Friday and set to be fully published on Saturday, aim to provide clarity for companies on how to comply with the law and avoid government intervention.
The Department of Canadian Heritage stated that these regulations would specify which platforms fall under the Online News Act and the steps they need to take to secure an exemption from the mandatory bargaining process.
To obtain an exemption, platforms must enter into agreements that support diverse Canadian news production across communities. These agreements must reach a certain threshold to qualify for an exemption.
However, Meta has already expressed that these proposed regulations will not affect its decision to end news availability in Canada. Rachel Curran, Head of Public Policy for Meta Canada, argued that the regulatory process cannot address the flawed premise of the Online News Act.
The draft rules are expected to generate 172 million Canadian dollars ($126.6 million) annually from Google and about 60 million Canadian dollars ($44 million) from Facebook.
If companies fail to meet the threshold through voluntary agreements with news outlets, they may be required to engage in mandatory bargaining overseen by the Canadian Radio-television and Telecommunications Commission (CRTC), which regulates media.
The proposed deals must also encompass independent local, Indigenous, and official language minority community news outlets.
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The CRTC plans to hold public consultations on these proposed regulations before finalizing them in the summer of the following year. However, mandatory bargaining is not anticipated to begin until late 2024 or early 2025, according to the CRTC’s timeline.
Meta’s decision to impose a news blackout since August 1 has drawn criticism from both the government and the public. The company’s refusal to lift the news block during recent wildfires in the Northwest Territories and British Columbia led Prime Minister Justin Trudeau to denounce its conduct as “inconceivable.”
Meta maintains that the Online News Act is founded on a flawed premise that it unfairly benefits from news content shared on its platforms when, in reality, the reverse is true.
Google has also criticized the law as a “link tax” and has threatened to ban news from its platforms when the regulations come into effect.
Proponents of the Online News Act argue that it aims to rectify the imbalanced relationship between news outlets and social media platforms, where journalists do the work, but large companies reap the majority of digital advertising revenue.
The Online News Act, passed by the Canadian parliament in June, calls for voluntary commercial agreements between major digital platforms and news outlets but grants Ottawa the authority to step in if such agreements are not reached.
Canadian Heritage Minister Pascale St-Onge expressed a desire to engage with social media companies constructively regarding the law, emphasizing the shared goal of ensuring quality access to information and news for Canadians.
A Google spokesperson indicated that the company is reviewing the government’s proposed regulations to assess whether they address the law’s significant structural issues.
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