Canada unveils proposed regulations for controversial online news act implementation

The Canadian government has released a set of regulations detailing its approach to enforcing the contentious Online News Act. This law mandates that social media giants compensate news organizations for the content shared on their platforms.

The announcement of these proposed rules comes amid ongoing tensions, as Meta, the parent company of Facebook and Instagram, maintains a news ban in Canada in response to the legislation.

The comprehensive regulations, set to be fully disclosed on Saturday, aim to provide clarity for companies to comply with the Online News Act independently, without government interference. The Department of Canadian Heritage emphasized this point, stating, “The proposed regulations provide clarity on which platforms are subject to the Act and greater certainty on what they need to do to obtain an exemption from the mandatory bargaining process.

To obtain an exemption, platforms must enter into agreements supporting the diverse production of Canadian news in communities across Canada. The total value of agreements must meet a certain threshold in order to qualify for an exemption.”

According to a Canadian official, these draft rules are projected to generate 172 million Canadian dollars ($126.6 million) annually from Google and around 60 million Canadian dollars ($44 million) yearly from Facebook.

In cases where companies fail to meet the specified threshold through voluntary agreements with news outlets, they may be subject to mandatory bargaining overseen by the Canadian Radio-television and Telecommunications Commission (CRTC), responsible for media regulations, as reported by Reuters. Additionally, these agreements must encompass independent local, Indigenous, and official language minority community news outlets, as outlined in the draft regulations.

The CRTC will now engage in public consultations regarding these proposed regulations, with plans to finalize them in the summer of the following year. However, the commencement of mandatory bargaining is not anticipated until late 2024 or early 2025, according to the CRTC’s timeline.

Meta’s ongoing news blackout, initiated on August 1, has drawn criticism from both the public and government officials for its handling of the issue. Prime Minister Justin Trudeau expressed his dismay, stating, “Facebook is putting corporate profits ahead of people’s safety.”

Meta contends that the Online News Act is based on a flawed premise, arguing that it is unfairly targeted as the beneficiary of news content shared on its platforms when, in its view, the opposite is true. Google has also labeled the law a “link tax” and has issued threats to ban news from its platforms once the regulations come into effect.

Nonetheless, supporters of the Online News Act argue that it aims to rectify the imbalance between news outlets and social media platforms, where journalists do the heavy lifting while large corporations reap the majority of digital advertising revenue.

The law, which the Canadian parliament passed in June, encourages voluntary commercial agreements between major digital platforms and news outlets but grants Ottawa the authority to step in if such agreements fail to materialize.