Catching Up on MediaPolicy – US Reps rattle trade sabres over #C11 – Québec Loi 57 breaks new ground in regulating online harms – CRTC relief for Corus and Québecor

May 19, 2024

“Music knows no borders,” tweeted US Congressman Lloyd Smucker (Rep, Pa-11) this week in an expression of American hubris familiar to Canadians.

But it’s been a few months since US members of Congress moaned to President Joe Biden about Canadian media regulation. So we were due.

Smucker, a mid ranking Republican on the House Ways and Means Committee, publicized his letter sent to Biden’s Trade Representative Katherine Tai warning that Canada’s CRTC might be poised to harm US music streaming interests by imposing regulatory obligations under Bill C-11.

Smucker got nearly half of the 43-member Ways and Means to endorse his letter, including a handful of Democrats led by the Los Angeles-area Representative Linda Sanchez. Perhaps significantly, the Democrat co-chair of the Trade Sub-Committee did not sign.

Legislative committee work is always an opportunity for federal politicians —-in both Washington and Ottawa— to get attention by making contentious accusations.

In that context, US House Representatives trying to intimidate Canada into retreating from exercising its cultural sovereignty is hardly new. The intimidation typically takes the form of threatening retaliatory trade sanctions against Canada without first proving a trade violation. I wrote about this as a central theme of my newly released book about C-11, Canada vs California: How Ottawa took on Netflix and the Streaming Giants. More in-depth accounts are found in Peter Grant and Chris Wood’s 2005 classic Blockbusters and Trade Wars or Garry Neil’s Canadian Culture in a Globalized World (2019).

Here’s Smucker’s accusation:

We are concerned that under the new law [the Online Stremaing Act] Canada will apply the logic of [35% Canadian song airtime] designed for [radio] broadcasters to modern music streaming services. 

The new law also gives the [CRTC] power to condition market access for music streaming services on making financial contributions to certain government-linked funds intended for the domestic music industry.

No doubt drafted by one of his staffers, Smucker’s letter overlooked the following:

• “National treatment” trade laws binding the US and Canada under the 2018 CUSMA agreement are activated by first proving discriminatory treatment of foreign versus Canadian companies, not the mere presence of regulation obligations imposed on both of them. Any regulations passed by the CRTC will bind music streamers headquartered on either side of the border but operating in Canada. 

• If trade law requires a direct comparison between CRTC-regulated Canadian radio stations and global music streamers operating in Canada, it might end up being an apple and oranges exercise and here’s betting the regulation of streaming will be considerably lighter than radio. On Canadian radio quotas, CRTC Chair Vicky Eatrides all but ruled out song quotas for streamers in a hasty statement issued shortly after the Bill passed. On cash contributions to Canadian music development funds —-they are run by industry, not “government linked”—-Canadian radio broadcasters carry a minimal obligation of one-half of one per cent of annual revenues, perhaps in acknowledgement of the weight of song quotas (35% of airtime in English Canada and 65% at French language stations). Somewhere in the middle range of potential outcomes for making Canadian music discoverable in Canada, the CRTC has assigned satellite music broadcaster Sirius a modest 10% Canadian song quota (25% for French language audiences) and a more substantial 4% of annual revenue cash contribution.

• Another wild card is whether foreign music streamers will be obliged to contribute to a Canadian news fund (Canadian radio stations meet that obligation by producing their own news).

There may be more of a back story to why these US Representatives decided to huff about Canadian music regulation at this particular time.

Certainly the major global music streamers continue to steadfastly oppose any Canadian obligations at all, in cash or “airtime.” However there are no new hair-on-fire public statements coming from the US Digital Media Association (DiMA), the lobby coalition representing music streamers YouTube, Amazon, Apple, and Spotify. 

In fact Smucker’s letter does not ask for pre-emptive trade sanctions against Canada, so for the moment this is a very quiet Yankee gunboat shot across the Canadian bow.

If there is any magic in the timing of Smucker’s letter, it could be that the CRTC is, at this very moment, contemplating the quantum of the cash contribution that DiMA’s members are going to pay to Canadian media funds. 

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While we’re still on the subject of Bill C-11, MediaPolicy posted earlier this week about two CRTC decisions to lighten (modestly) the regulatory burdens of Québecor TVA’s station in Québec City and Corus’ spending on Programs of National Interest. 

The rulings came with the Commission’s warning that it wasn’t going to look at any other regulatory relief for Canadian broadcasters until 2025 at the earliest.

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Last month Francois Legault’s CAQ government introduced Québec Loi 57. The law would impose fines of up to $1500 on anyone “threatening, intimidating or harassing” elected officials in a manner that “unduly hinders” or “obstructs” them from carrying out their duties at the municipal and provincial level. 

One clause may entitle an elected official to obtain a judge’s injunction against a citizen if the official “is the subject of remarks or gestures that unduly hinder the exercise of his duties or infringe his right to privacy.” 

Another clause contemplates a fine if a citizen obstructs the exercise of the functions of a deputy or a municipal elected official “by threatening, intimidating or harassing him in such a way as to make him reasonably fear for his integrity or safety.”

As an editorial aside, fining a citizen because of a public official’s “fear for my integrity” seems to jump off the page.

The Bill was introduced after several years of public comment, a government sponsored public awareness campaign, and impact studies on democratic participation resulting from abusive social media comments directed at politicians, including widespread misogyny. 

Across Canada, many elected officials have retired from politics citing online harassment as the cause. On the federal level, Canadians may recall the gravel-throwing incident targeting the Prime Minister during the 2021 election campaign.

Quebec’s Municipal Affairs Minister Andreé Laforest cited the province’s upcoming 2025 municipal election, with 8000 positions being contested, as an imperative for moving quickly on the issue.

In an opinion editorial published in Le Devoir, University of Montreal law professor Pierre Trudel questions the need for the law, given existing laws that protect privacy and prohibit harassment and threats. He wants to know why the legislation is needed, or more bluntly how much further does it want to go? He concedes that a judge will ultimately decide what citizen speech or actions “unduly hinder” elected officials, but do we really need to find out?

The major news organizations in the province have objected to the legislation out of concern the harassment and privacy protections are too vague and could be used by elected officials to frustrate or chill investigative reporting of government activity.

The timing of introducing the Bill was not the greatest. Only last week the municipal government of Sainte-Pétronille, a suburb of Québec City, got a slap on the wrist from the province’s Municipal Commission for threatening to stop its financial contributions to the local paper that was about to report on the village’s new general manager. The Commission acknowledged the threat to press freedoms but found “no reprehensible acts.”

The upside of the new law being promoted first in Québec is that it serves as a petri-dish experiment in the limits of regulating online harms. The Trudeau Liberals’ federal bill C-63 has a more demanding and precise threshold for prosecuting online hate or else leaves it up to the social media platforms to police their own online turf. 

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