The Liberal government has unveiled the draft regulations to implement its Online News Act
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OTTAWA – The Liberal government has unveiled the draft regulations that will implement its Online News Act, legislation that Google and Meta have said could lead them to permanently block news content on their platforms in Canada.
The government has said it hopes the new regulations will cause Google and Meta to reconsider those plans, but Meta remained unmoved Friday while Google said it’s still assessing whether its concerns have been addressed.
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The new regulations include a formula for calculating how much revenue the social media giants would be expected to share with Canadian news publishers under the law, while providing more details about how the tech companies can receive exemptions from the legislation by making their own deals with news-publishers.
Government officials said that under the legislation Google could contribute $172 million a year and Facebook $62 million to Canadian news publishers, based on Google’s global search revenues and Meta’s Facebook global revenues. That’s about in line with previous department estimates but lower than the Parliamentary Budget Officer’s $329 million estimate last year.
But officials said those numbers could be revised up or down because the government is open to consulting with affected parties and adjusting the formula.
Since a stand-off with the tech giants began after the passage of the Online News Act (formerly known as Bill C-18), the government has been hoping Google and Meta’s issues with the law — such as the lack of a cap on how much they would have to pay news publishers — could be addressed through the regulatory process.
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Meta, which is already blocking news in Canada on Facebook and Instagram, has maintained that its concerns with the legislation could not be remedied through regulations and has said it will permanently block news content in Canada. Following the release of the draft regulations Friday, its stance was unchanged.
“As the legislation is based on the incorrect assertion that Meta benefits unfairly from the news content shared on our platforms, today’s proposed regulations will not impact our business decision to end news availability in Canada,” Rachel Curran, head of public policy for Meta Canada said in a statement.
Curran said “the regulatory process is not equipped to address the fundamentally flawed premise of the Online News Act.”
Google has suggested it is more open to compromise, although it has also said it plans to pull news from Google search and other products if its concerns aren’t addressed.
A Google spokesperson said Friday the company is “carefully reviewing the proposed regulations to assess whether they resolve the serious structural issues with C-18 that regrettably were not dealt with during the legislative process.”
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It will take time for the company to determine whether the draft regulations sufficiently address its issues with the bill, Google said.
The legislation, passed in June, would force the two tech giants to share revenues with news publishers (Postmedia, publisher of the National Post, has publicly supported the legislation). If the companies pull links to news articles from their platforms, the Online News Act will no longer apply to them.
On Friday, the government provided detail on how it would provide room in the regulations to allow Google and Meta to reach voluntary deals with publishers that could exempt the tech companies from being subject to the legislation’s mandatory bargaining and arbitration process administered by the CRTC. Those deals could include both monetary and non-monetary contributions.
That also means the total payments to news publishers could be lower than the government estimates.
To calculate the revenue-sharing payments, the government is using a formula that multiplies the platforms’ global revenue with the Canadian share of global GDP, multiplied by a contribution rate of four per cent. Exactly what the government will ultimately consider as “global revenues” was not made clear Friday — for instance, whether Meta’s revenues from its Instagram platform would be included.
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Officials said in a technical briefing the regulations are a way for the government to show it’s addressing the major concerns from the platforms, including an unclear path to exemption. The new regulations specify that to be exempt, deals reached voluntarily must have a total compensation that exceeds the amount calculated by the government’s formula and that compensation under each deal must be within 20 per cent of the average compensation reached under legislation.
The deals must also include “collectives of certain size representing independent local, Indigenous and official language minority community news businesses,” the government said in background document. Small, independent news publishers say they have been the hardest hit by Meta’s decision to start blocking news a month ago.
An official said the government is “looking forward to engaging with (Meta and Google) in a constructive manner in the weeks ahead on the proposed approach.”
Paul Deegan, CEO of publishers’ group News Media Canada, said at “first pass, the regulations appear fair and balanced to both publishers and platforms. It gives everyone a level of clarity and predictability, which we have been calling for and welcome.”
The draft regulations are now open for a 30-day consultation period before being finalized.
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2023-09-01 17:37:30Z
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