The government’s bad run of digital policy choices that led to blocked news links on Facebook and Instagram, ongoing litigation over mandated streaming payments, and the recent cancellation of the digital services tax, has paved the way for another costly loss. Last fall, the Canadian government announced the conclusion of its national security review of TikTok and arrived at a curious plan: ban the company from operating in Canada but leave the app itself untouched. The decision raised concerns about weakening privacy enforcement as the Privacy Commissioner of Canada acknowledged that it is easier to compel documents and support investigations if the company is in Canada (the results of a Privacy Commissioner investigation into TikTok have still not been released).

The decision also seemed likely to hurt cultural groups who had grown reliant on TikTok sponsorship and support. This was discussed in a Law Bytes podcast episode with Scott Benzie of Digital First Canada, who discussed the remarkable successes of TikTok creators in Canada warned about the harm they would face with a corporate ban. Similarly, at the time I wrote:

TikTok will likely promote that it has spent significant money on Canadian cultural policy initiatives, with a particular focus on music and indigenous creators. Much like the Meta withdrawal from news and its associated agreements, it is similarly unlikely it will continue to provide that support in light of the corporate ban.

Sure enough, TikTok has now announced that it is pulling sponsorships from art institutions such as the Juno Awards and Toronto International Film Festival. It is also cancelling support for the ADISQ music awards gala that honours the Quebec music sector and ending the National Screen Institute’s TikTok Accelerator for Indigenous Creators, which has worked with hundreds of indigenous creators over the years. The company is still challenging the government’s decision in federal court, but the loss of millions in cultural support was entirely predictable.

I’ve argued that Canada needs better laws, not app bans with regard to TikTok. There are real issues and risks with the service that require a serious policy response. But removing the corporate offices and leaving the app untouched always seemed to guarantee the worst possible outcome by doing little to address the potential risks faced by Canadians and bringing to halt some of the cultural benefits of having the service operate in Canada. This represents yet another own goal that undermines the government’s hopes of increased support for the cultural sector.