Heritage Minister Steven Guilbeault is hinting that changes to Canada’s broadcasting and telecom rules could include making online streaming giants like Netflix and Amazon pay sales taxes and requiring them to invest in Canadian programming.
On Wednesday, an expert panel delivered a report to the federal government recommending sweeping new powers and responsibilities be given to the Canadian Radio-television and Telecommunications Commission, including oversight of foreign streaming services like Netflix, Amazon and Apple.
Speaking at a broadcasting industry conference in Ottawa Thursday, Guilbeault promised legislation to reform Canada’s broadcasting and telecom rules within months, but offered few details on what the changes will be.
Later, when pressed by reporters, he suggested there were a few of the panel’s particular recommendations that he agreed with, including one saying Ottawa should immediately require streaming companies to start collecting and remitting GST/HST.
“I think that’s about fairness. Everybody is paying the GST in Canada, I don’t see why some of the richest companies in the world shouldn’t pay GST in Canada,” Guilbeault said.
He also noted that Prime Minister Justin Trudeau said in a recent interview that a measure to tax online streaming services could be coming in the federal budget.
The federally appointed review panel headed by former Telus and cable-industry executive Janet Yale delivered its 235-page report Wednesday, including 97 recommendations for changes.
Some of those are relatively simple, such as renaming the Broadcasting Act and Telecommunications Act, as well as the CRTC.
Others would require major shifts in policy, including one that would require online streaming companies to invest in Canadian content, as domestic broadcasters are already required to do.
The panel suggests the CRTC should be responsible for a new registration process for internet companies such as Netflix that distribute media content in Canada, whether the provider is domestic or foreign.
The proposed new registration regime would require online streaming services that benefit from operating in Canada to devote a portion of their program budgets to Canadian programming. The amounts paid would be based on how much the companies make from Canadian customers, with further details to be determined by the CRTC.
On Thursday, Guilbeault suggested the government favours a move in this direction.
“They are already spending money in Canada, all we will be asking them to do is to do it in a more organized way and to ensure that we have Canadian cultural content that is available for Canadians and for audiences around the world,” Guilbeault said.
“We’re not asking them to do more, we’re just putting in place a system to ensure that it’s done well.”
Yale said Thursday this model is one of the least intrusive ways that regulators can make streaming services contribute to Canadian content without changing their business models.
“We’re not telling them what categories of content to produce, we’re not telling them where to produce it, we’re just telling them that they have to take a certain amount of the money they’re already spending in Canada and make sure it complies with Canadian-content requirements.”
Guilbeault said the government will take time to study the panel’s report before making any concrete commitments for reforms. Some changes will come through legislation, Guilbeault said, adding that this could be tricky, as it will require support from opposition parties to pass in the minority Parliament.
That’s why the government is also looking at possible regulatory changes that could be decided and implemented more quickly, as such changes would only require the approval of cabinet.
During a panel discussion later in the day, the CBC’s president Catherine Tait did not address the panel’s recommendation that the CBC phase out advertising.
She did talk about the partnerships that traditional broadcasters have been forming with streaming services, such as CBC’s co-operating with Netflix on the popular show “Schitt’s Creek.”
Tait says co-productions with streaming companies do amplify Canadian content, which has happened in the case of “Schitt’s Creek.”
But she also warned that Canadian broadcasters need to ensure they have adequate time to feature this content on their own domestic platforms before it is handed to streaming services to air internationally.
“It’s not that we don’t want to be in business with the foreign streamers, it’s that we need to protect the Canadian windows for our own exploitation ... so that the Canadian-owned content has a chance to be fully exploited in this marketplace,” Tait said.
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