CRTC increases funding requirements for online streamers to support Canadian content

The Canadian Radio-television and Telecommunications Commission (CRTC) has announced that large online streaming providers like Disney+, Netflix, and Prime Video will be required to contribute more of their revenue to Canadian content. This decision stems from the Online Streaming Act, which was passed in 2023 under the former Trudeau government.

Under the new rule, streaming companies with at least $25 million in annual Canadian revenue will need to direct 15% of that revenue toward supporting the creation of Canadian content, including movies, television shows, and local news. This is an increase from the initial requirement of 5%.

The CRTC is also lowering the base contribution rate for traditional broadcasters to 25% from the previous range of 30 to 45%. These changes are aimed at stabilizing funding for Canadian content at around $2 billion per year.

In addition to the financial contributions, the CRTC will now allow streaming platforms to work directly with Canadian production companies to produce content. This shift is intended to encourage streaming services to see their investment in Canadian content as an opportunity to create high-quality shows that appeal to both Canadian and international audiences.

The new regulations will also include guidelines to ensure that Canadian and Indigenous content is prominently featured on online streaming platforms for viewers to discover easily. Minister of Canadian Identity and Culture Mark Miller stated on social media that the government is reviewing these changes to ensure that Canadians continue to see themselves reflected on screen and hear Canadian voices.

While streamers have challenged the initial 5% requirement in court, the CRTC is moving forward with its policies. Legal battles aside, these changes could potentially lead to increased costs for Canadian consumers as the cost of doing business for streaming platforms in Canada has significantly increased.

U.S. lawmakers have been critical of Canada’s Online Streaming Act, labeling it a “Netflix Tax” and a trade irritant. A Republican bill introduced in March aims to investigate the act and potentially impose retaliatory tariffs. The U.S. Trade Representative has cited this legislation as a trade irritant, and the CRTC’s recent decision may further escalate concerns from the U.S. about the fairness of these regulations.