US says online Canadian news and streaming bills ‘discriminate’ against US companies

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The United States is concerned about two high-profile Liberal government bills to regulate big tech “discrimination” against U.S. companies, the U.S. Trade Representative has told Canada’s Minister of International Trade.

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A statement issued Wednesday by U.S. Trade Representative Katherine Tai said Tai “expressed concern about Canada’s unilateral Digital Services Tax proposal and pending legislation in Canadian Parliament that may have a impact on digital streaming services and online news sharing and discriminate against American businesses”.

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The post follows a virtual meeting between Tai and International Trade Minister Mary Ng on Wednesday. A reading released by Global Affairs Canada following the meeting made no mention of the two bills, C-11 and C-18, or the digital services tax.

Bill C-11 creates the CRTC to regulate platforms like Netflix and YouTube, with the idea that they would help create Canadian cultural content, but has sparked controversy over potential regulation of user-generated content .

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Bill C-18 would force Google and Facebook’s parent company, Meta, to share their revenue with Canadian news publishers, a system that could end up funding about 30% of the cost of producing news in Canada.

Both bills are currently being amended by parliamentary committees. Google has publicly criticized both and launched campaigns arguing that they will have negative consequences. Meta has threatened to remove Facebook news content in Canada about Bill C-18.

Laura Scaffidi, spokeswoman for Heritage Minister Pablo Rodriguez, said in an emailed statement Wednesday that “the experts have been clear: Bill C-11 is consistent with Canada’s international trade obligations.”

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She said the government has “had constructive conversations with overseas studios and they appreciate the flexibility of the bill. Canadians expect broadcasters to do more for our culture, while maintaining access to content and services from around the world. That is exactly what Bill C-11 does.

Conservative Sen. Leo Housakos brought up the reading during a Wednesday night meeting of the Senate Transportation and Communications Committee, which is in the process of amending Bill C-11. “Our largest trading partner expressed concern today,” he said.

Thomas Ripley, Associate Assistant Deputy Minister for Cultural Affairs at Canadian Heritage, responded that the government “has worked hard to ensure that U.S. officials, as well as U.S.-based services that may be impacted by these legislative changes , understand the government’s objectives”.

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Ripley added: “We’ve heard constantly from them about the importance of making sure that ultimately the framework is flexible enough, that they’re able, from their perspective, to continue to operate. in the Canadian market…we kept that in mind all the time.

Housakos replied that “we have already had this response from the government, that there is an ongoing discussion”.

“We’ve been hearing this for a year and a half, two years, but now we have their trade commissioner, clearly concerned about our streaming legislation…the US comfort level doesn’t seem to be increasing. It still seems controversial. »

In the 2021 budget, the Liberal government promised a Digital Services Tax for large companies that operate online marketplaces, social media platforms and derive revenue from online advertising, such as Amazon, Google and Facebook, as well as Uber and Airbnb. He said the tax would raise $3.4 billion over five years.

The Liberal government has since promised to move forward with the tax, which would be retroactive to 2022, if a multilateral tax agreed to by Organization for Economic Co-operation and Development countries is not in place. by 2024.