A number of U.S. Congress members have taken issue with the Trudeau government’s Online Streaming Act, arguing that it discriminates against American citizens, and have asked their country’s top trade official to intervene.
Nineteen Congress members signed a joint letter sent to U.S. Trade Representative Katherine Tai, requesting that she resolve their dispute with the Liberals’ protectionist media bill.
The Online Streaming Act forces online platforms like Netflix, Amazon Prime and Spotify to promote Canadian content, and contribute financially to their production.
The Canadian Radio-television and Telecommunications Commission is responsible for drafting the framework of the bill, although on Thursday the commission announced that the regulatory framework would be delayed until late next year as the agency undergoes a consultation period.
The signatures of the letter include eight Democrats and 11 Republicans, who say that the act’s implementation “will result in trade barriers” for the U.S. music streaming industry.
They argue that the legislation, which would bring them under Canada’s Broadcasting Act, is designed for a bygone era that no longer makes sense in today’s digital world.
The Broadcasting Act “requires Canadian radio broadcasters to program about 35% of their airtime with Canadian music as part of the government’s efforts to ensure the availability of Canadian content,” reads the letter.
“We are concerned that under the new law, Canada will apply the logic of quotas designed for terrestrial broadcasters to modern music streaming services. Global online streaming services are not the same as domestic broadcasters, and we believe these provisions clearly discriminate against American content, interfere with consumer choice, and harm American artists and rights holders.”
The Congress members addressed and took issue with how the act derails financial streams from the domestic music industry into government-linked funds.
“The new law also gives the regulator power to condition market access for music streaming services on making financial contributions into certain government-linked funds intended for the domestic music industry, which, if put in place, would constitute new nonconforming measures restricting cross-border digital trade.”
The letter requests that Tai resolve the issue in a way that arrives at a “flexible system” that does not make matters worse for “Canadian consumers and American artists alike.”
“The Office of the United States Trade Representative’s engagement with the Canadian government is crucial to ensure that the way forward is not to make the consumer experience on music streaming services worse for Canadian consumers and American artists alike, but to arrive at a flexible system respecting consumer choice and the interests of the U.S. music industry and artists,” it reads.
However, the Trudeau government argued that there is a provision for “cultural sovereignty, including in the online environment” under the United States-Mexico-Canada Agreement, which came into effect in July 2022, replacing the North American Free Trade Agreement.
This allows for governments to take measures to protect the publication, distribution and sale of broadcasting, film, television, videos, books, and magazines.