A before and after picture of the Online News Act C-18, with Heritage Committee amendments.

Heritage Minister Pablo Rodriguez sponsored Bill C-18 in the House

December 12, 2022

Here is the unofficial English text of Bill C-18 including amendments passed last week by the Commons’ Heritage Committee.

Amendments have been highlighted. It’s a cut and paste document so please contact me at howard.law@bell.net with any errors or omissions.

A few observations are in order as the Bill is prepared for Third Reading in the House in February.

The legislation was conceived by Heritage Minister Pablo Rodriguez as the Canadian version of the 2021 Australian News Media Bargaining Code, in spirit if not to the letter.

Following a lengthy investigation and report by the Australian competition commissioner Rod Sims, the ‘Australian model’ was designed as a remedy to Facebook and Google exploiting market power over news distribution to the detriment of news organizations that have little choice but to distribute on those platforms. The Australian Code was mostly agnostic about which news organizations participated or benefited from the mandatory bargaining scheme.

This philosophy of ‘competition policy first’ was reaffirmed in the Australian Finance Minister’s recent report that rejected ‘media policy’ considerations of which news organizations belonged in the Code, how much they should be paid, or indeed how much they need to survive. That’s best left to targeted government subsidies, said the report.

Canada’s Bill C-18 is founded on the same principles. Nonetheless the Minister injected a large dose of media policy into the Bill, which was magnified by further amendments during the Committee process, to meet political demands made by small news outlets or those considered voices of underrepresented communities. Indigenous outlets were a major focus of amendments.

What is important to remember is there is nothing in the Act which suggests that every news outlet can prove the value of its news content exceeds the distribution benefits it receives in return from Facebook or Google, driving a net compensation pay-out.

What’s more, nothing in the Act suggests news organizations are entitled to either a pro rata or equal payment. There will be as many views about the value (and volume) of news content as there are bargaining parties.

At least in theory.

In practice most if not all of the ‘news outlets’ that can meet the statutory definition should end up getting paid and in an amount comparable to similar news outlets. This is especially likely if they combine with other news outlets in a bargaining coalition that is authorized by the Bill and then reach agreements with the Californian platforms. That’s what happened in Australia.

There is always the default option for either party to go to arbitration which offers the opportunity to make a case on value exchange.

Here are some of the more significant changes to C-18:

• Indigenous news outlets: NDP MP Peter Julian sponsored a series of amendments with all-party support. An Indigenous news outlet can be as small as a single owner/operator journalist who focusses on community issues and is mostly exempt from having to meet other journalism criteria in the Act. While the provisions in section 11(1)(a)(vii) of the Act can hypothetically result in an Indigenous news outlet being excluded from compensation, section 31(2.1)(b) appears to override this and guarantee a positive bargaining outcome.

• The threshold requirement for a news outlet to employ two independent journalists was watered down to allow either journalist to be a proprietor or family member.

• News organizations must demonstrate real news gathering activity. They must also belong to a legitimate Press Council or else adhere to a professional journalism code of conduct.

• Attempts to make bargaining outcomes public —providing transparency and helping smaller news organizations benchmark their bargaining expectations—- failed. The government defended its use of the confidentiality carrot to entice Google and Facebook into reaching voluntary agreements, as they did in Australia. Some less ambitious transparency measures were added to the Bill.

• An amendment lengthening the duration of a platform exemption (and therefore the length of any voluntary deal with news organizations) to five years offers some protection to news outlets. The downside is that any news start-ups during that five year period will be frozen out.

• The government rethought section 51 of the Bill inviting the CRTC to second-guess the platforms’ news ranking algorithms. The amended Bill follows the Australian model by restricting the CRTC’s authority to self-dealing by the platforms or bargaining-related retaliation against news organizations.

Critiques of C-18 will continue. They boil down to this:

• A rejection of the Australian Competition Commissioner’s findings that Facebook and Google exploit market power over the value exchange between them and news organizations or that mandatory bargaining with the availability of binding arbitration is required to correct that. This denial is the Facebook narrative. It also has Canadian supporters: Jen Gerson of The Line tersely called C-18 “a lie.”

• Putting aside the argument over value exchange, other Canadian voices like Michael Geist and fellow members of the Internet Society oppose in principle most government regulation of the Internet. Those commentators are especially critical of removing the platforms’ copyright shield of fair use and legislating compensation for content made available through hyperlinks.

• Others oppose government aid to media under any circumstances, whether it’s payments from Big Tech or government subsidies. They favour ‘creative destruction’ in which news organizations either find a market solution or fail, leaving their market share to other news organizations.

• Some oppose any scheme that aids big news organizations —-to name a few: Postmedia, the Toronto Star, Bell Media CTV, Global News, Rogers City-TV, and Québecor— because they don’t like corporate media for a variety of reasons.

• The Conservatives dip into most of these narratives. They are especially opposed to the CBC benefiting from the legislation, a position that dovetails with their ‘defund the CBC’ platform.

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