Later today, the House of Commons will vote to approve Bill C-18, the Online News Act, sending it to the Senate just prior to breaking for the holidays. While Canadian Heritage Minister Pablo Rodriguez and media lobbyists will no doubt celebrate the milestone, it should not go unremarked that the legislative process for this bill has been an utter embarrassment with an already bad bill made far worse. The government cut off debate at second reading, actively excluded dozens of potential witnesses, expanded the bill to hundreds of broadcasters that may not even produce news, denigrated online news services as “not real news”, and shrugged off violations of international copyright law. All the while, it acknowledged that mandated payments for links are the foundation of the bill with officials stating that individual Facebook posts accompanied by a link to a news story would be caught by the law. As for the purported financial benefits, the government’s own estimates are less than half those of the Parliamentary Budget Officer, who also concluded that more than 75% of the revenues will go to broadcasters such as Bell, Rogers, and the CBC. The end result is a bill that will undermine competition and pose a threat to freedom of expression, while potentially leading Facebook to block news sharing in Canada and Google to cancel dozens of existing agreements with Canadian news outlets.
Archive for December, 2022
Shakedown Complete: The Story Behind Bill C-18’s Shameful Legislative Review Process and the Race to Mandate Payment for Links
The Senate Standing Committee on Transport and Communications completed its extensive review of Bill C-11 last week. After a review for grammatical, editorial, and translation issues, the committee is expected to finalize its report back to the Senate later today. While the next steps for Bill C-11 remain somewhat uncertain, the committee should be congratulated for providing a model for legislative review. Indeed, the Senate committee was everything the House committee was not: policy focused, open to hearing from a wide range of witnesses, and willing to engage in meaningful debate on potential amendments. Politics occasionally arose during the clause-by-clause review, but political considerations were never going to be entirely stripped from a highly politicized piece of legislation.
I may have missed the odd change, but the following amendments were approved by the committee:
The Law Bytes Podcast, Episode 150: How Will Canada Regulate News and Streaming – My Appearance on TVO’s The Agenda
The government’s two big Internet bills – Bill C-11 and Bill C-18, both made significant advances late last week. The Senate Transport and Communications committee concluded months of hearings on Bill C-11 by agreeing to about 25 amendments, notably including a change to the scope of user content regulation that is designed to limit the application to sound recordings as well as the removal of a provision that critics feared would limit CRTC independence. Meanwhile in the House, Bill C-18 cleared the Canadian Heritage committee with changes that invite legal challenges and make a showdown over blocking news content increasingly likely.
Just prior to these committee meetings, I appeared on TVO’s the Agenda with Steve Paikin to discuss the bills and why they matter. The interview elicited very positive feedback and with the kind permission of TVO and the Agenda, I’m pleased to provide the audio version of that interview as this week’s Law Bytes podcast.
Big Cost, Smaller Benefit: Government Modelling Pegs Likely Bill C-18 Revenues at Less Than Half of Parliamentary Budget Officer Estimates
Canadian Heritage Minister Pablo Rodriguez has touted Bill C-18, the Online News Act, as critical for Canada’s media sector, but government’s internal modelling suggests there will be limited benefits for most news outlets. Earlier this fall, the Parliamentary Budget Officer estimated that it would generate $329 million per year, with over 75% of that revenue going to broadcasters such as Bell, Rogers, and the CBC. At the time, I noted that meant that “newspapers will receive less than 25% of the funding or about $81 million to split among hundreds of news outlets.” It turns out that the government believes that vastly overstates the benefit as its own modelling estimates about $150 million in total revenues, less than the 50% of the PBO’s estimate. Assuming a similar apportionment of revenues between broadcasters and newspapers, that would place the benefit at just over $37 million for the entire newspaper sector. In fact, as the government has expanded the eligibility to hundreds of additional outlets, the benefits for each organization shrinks even further.
Scoping User Content Out of Bill C-11: Senate Committee Makes Much-Needed Change, But Will the Government Accept It?
The widespread concern over Bill C-11 has largely focused on the potential CRTC regulation of user content. Despite repeated assurances from the government that “users are out, platforms are in”, the reality is that the bill kept the door open to regulating such content. The language in the bill is clear: Section 4.2 grants the CRTC the power to establish regulations on programs (which includes audio and audiovisual content by users). The provision identifies three considerations for the Commission, most notably if the program “directly or indirectly generates revenues.” The revenue generation provision is what led many digital creators to argue they were caught by the bill and for TikTok to conclude that any video with music would also fall within the ambit of the legislation.
The Senate Standing Committee on Transport and Communications, which has conducted months of hearings on Bill C-11, was clearly convinced that the user content issue needed to be addressed. Last night (hours after the ill-advised addition of age verification to the bill), it agreed on an amendment that, with two key caveats, goes a long way to scoping out user content regulation.