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Canada passes bill that compels platforms like Netflix, YouTube to show more local content

Canada approved legislation that would force streaming platforms like Netflix, YouTube, and TikTok to show more local content.

What’s the news: Canada on June 21 approved legislation that would bring online streaming and audio/video sharing platforms under the authority of the country’s broadcast regulator and force them to offer more local content, Reuters reported.

What does it mean: Streaming platforms like Netflix, YouTube, Spotify and social media sites like TikTok will have to offer more local content to a Canadian audience. For example, if a user in Canada searches for a do-it-yourself video on YouTube, a certain quota of the search result must be videos by Canadian creators.

Why does the matter: Apart from being a regulatory burden on platforms, this legislation sets a precedent that might inspire other countries to follow in Canada’s footsteps. As it is, India has been pushing for all things local and legislation similar to this might soon be on the radar of India’s Ministry of Information Broadcasting. If other countries adopt similar measures it could harm Canadian creators who have a global audience, the opposite effect of what the Canadian government wants. For users of these platforms, this law could harm the quality of offerings as better international offerings might be demoted in lieu of local alternatives.

“Canada would start the process of erecting international trade barriers to the current free exchange of cultural exports on open digital platforms that Canadian creators depend on.” — YouTube said in a written brief submitted to Parliament, according to the Wall Street Journal

TV and radio broadcasters already have a similar law: In Canada, television and radio broadcasters must air a certain quota of domestically-made content as a license condition. This decades-old policy was introduced to protect Canada’s cultural sector amidst an influx of US programming. Now, online platforms will be subject to similar conditions.

What is ‘Canadian’ content: Once the law comes into effect, Canada’s broadcast regulator will come out with rules on what is considered Canadian content, but this is not as straightforward as it might seem. “Netflix, for instance, said the animated film, The Willoughbys, was produced, co-written and directed by Canadians, and stars Canadian voice actors—but under existing rules wouldn’t qualify as Canadian content because U.S.-based Netflix arranged all the financing,” the Wall Street Journal pointed out.

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How did this law come about: The bill was introduced by Canadian Prime Minister Justin Trudeau’s Liberal government and cleared the House of Commons, the lower house of the parliament, by 208 votes to 117.  The Canadian government believes it will ensure that online streaming services promote Canadian music and stories and support local jobs. Critics of the bill argued that it was rushed to a vote without studying the potential impact on independent content creators.

What else: Pablo Rodriguez, Canada’s minister for cultural affairs, also said that the country will demand that streaming companies and video-sharing sites make annual payments to fund Canadian artists. It is not clear if this is part of the legislation or plan for future legislation.

What next: The bill will become law once the Canadian Senate adopts it and it receives royal assent, which is expected to happen.

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