Canadian Regulator Says Foreign Streamers Must Contribute 5% of Canadian Revenue to Fund Local Content

Canadian regulators streamers pass fee to fund local content
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Canadian regulators streamers pass fee to fund local content
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Photo Credit: Hermes Rivera

As part of Canada’s implementation of its Online Streaming Act, the Canadian Radio-Television and Telecommunications Commission (CRTC) will require foreign streamers to contribute 5% of their Canadian revenue to support local content.

The Online Streaming Act was signed into Canadian law on April 2023 and requires streamers that are not affiliated with Canadian broadcasters and generate more than $18.2M (CAD$25M) or more in Canadian revenue per year to contribute 5% of that revenue to support local content. The CRTC estimates the move will raise $146M (CAD$200M) a year for Canada’s broadcasting system for local news and content from underrepresented groups.

The CRTC has outlined the following percentage split for the 5% of revenue collected from foreign streamers each year. Both video streamers (Netflix, Disney+) and music streamers (Spotify, Amazon Music, Apple Music, YouTube Music) must pay this percentage.

  • 2% to the Canada Media Fund
  • 1.5% to the Independent Local News Fund
  • 0.5% to the Black Screen Office Fund, Canadian Independent Screen Fund for BIPOC Creators and/or the Broadcasting Accessibility Fund
  • 0.5% to the Indigenous Screen Office Fund
  • 0.5% to the Certified Independent Production Funds

Warren Sonoda, President of the Directors Guild of Canada, praised the move. He says “[it] demonstrates a strong commitment to the sustainability and growth of our film and TV production sector, leveling the playing field and positioning Canada alongside other jurisdictions that have adopted measures to protect their cultural sovereignty and bring their broadcasting systems into the digital age.”

Not everyone is happy with the move. The Digital Media Association—which represents music providers including Amazon Music, Apple Music, and Spotify—called the move a “discriminatory tax on music streaming services that are already making significant contributions to Canadian artists and culture.”

The MPA-Canada said the CRTC didn’t fully consider “the significant contributions streamers make in working directly with Canada’s creative communities.” This group represents video streaming services including Netflix, Paramount+, Disney+, HAYU, PlutoTV, and Crunchyroll.