The government is releasing its draft regulations for Bill C-18 today and the chances that both Google and Meta will stop linking to news in Canada just increased significantly. In fact, with the government setting an astonishing floor of 4% of revenues for linking to news, the global implications could run into the billions for Google alone. No country in the world has come close to setting this standard and the question the Internet companies will face is whether they are comfortable with the global liability that would see many other countries making similar demands. The implications are therefore pretty clear: there is little likelihood that Meta will restore news links in Canada and Google is more likely to follow the same path as the Canadian government establishes what amounts to 4% link tax from Bill C-18 on top of a 3% digital services tax and millions in Bill C-11 payments.
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Why Heritage Minister Pascale St-Onge Doesn’t Seem to Understand How Bill C-18 Works
Heritage Minister Pascale St-Onge went on a media offensive late last week, granting interviews to a wide range of publications. St-Onge noted that she had “positive” talks with Google and Meta that she hoped would result in a compromise and improbably claimed concern for users’ rights to share information online, an odd position given that Bill C-18 undermines the free flow of information online with its mandated payments for links approach. St-Onge got the headlines she was no doubt looking for, but it was pretty obvious that not much had changed, with Meta confirming that she had requested the meeting and that it is continuing to end news availability in Canada. While that was typical of the English-language coverage, St-Onge’s comments to French language outlets such as La Presse and Journal de Montreal added another dimension, with the Minister suggesting that companies should negotiate deals by year-end in order to become “exempt” from the law.
St-Onge may want to leave the impression that there is an easy out for the tech companies, yet the reality is those comments fundamentally misunderstand how Bill C-18 works.
What Urgency?: CRTC Says It Will Take Years For Bill C-18 Media Bargaining to Begin
The Bill C-18 legislative process was marked by repeated warnings from the government that this was an urgent issue that justified its repeated efforts to cut off debate in order to fast track the bill into law before the summer break. In fact, in a late change, the bill was amended to provide that it would take effect with 180 days of royal assent, rather than the previously envisioned staged approach that would have resulted in a gradual development of regulations and implementation. That change has had enormous implications as the law can now take effect at any time but no later than December 19, 2023, which in turn led Meta to move to comply with the law immediately by blocking news links in Canada.
Notwithstanding the government’s plans, the CRTC apparently has other ideas.
Bill C-18 and the CBC’s Self-Destructive Approach to Government Digital Policy
I need to start this post by making it clear that I am a supporter of publicly funded broadcasting and the CBC. With the increased use of paywalls and dramatic shifts in the media landscape, there is value in a public broadcaster that fills the gaps in the privately owned media world by ensuring that all Canadians have open, freely available access to reliable news. That requires embracing all forms of distribution, maintaining steadfast independence, and limiting direct competitive overlap with the private side that is currently facing significant digital transition challenges. This should be an easy value proposition for the CBC and one that would provide a compelling case for public funding. Yet the CBC’s approach to Bill C-18 and other government digital policies seems determined to do the opposite and, in doing so, threatens its future support.
The Bill C-18 Regulation Fake-Out: Setting the Record Straight on When Bill C-18 Takes Effect and the Regulation Making Process
The rhetoric around Bill C-18 has escalated in recent days in light of the awful wildfires in NWT and British Columbia. In my view, the issues associated with these tragic events have little to do with Meta blocking news links and the attempt to bring it into the conversation is a transparent attempt to score political points (the connectivity issues with some NWT communities completely taken offline for days is somehow never mentioned). The reality is that Meta was asked about just this scenario at committee and it made it clear that it would not block any non-news outlet links. That is precisely what has been happening and the government’s legislative choices should be the starting point for understanding why compliance with the law involves blocking a very broad range of news links that extend beyond even those sources that are defined as “eligible news outlets”.
The government and supporters of Bill C-18 talking points now emphasize two things in relation to Meta blocking news links: the law has yet to take effect and there is room to address their concerns in the regulation-making process. Both of these claims are incredibly deceptive, relying on the assumption that most won’t bother to read the actual legislation. If they did, they would see that (1) the law has received royal assent and can take effect anytime and (2) the regulation making process addresses only a small subset of Bill C-18 issues with most of the core issues finalized. In other words, the time to shape the law and address many of the key concerns was before the government repeatedly cut off debate in order to ensure it that received royal assent before the summer break.
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