Netflix doesn’t want to pay into Canadian Media Fund

Being forced to pay into funds is discriminatory, company says

Netflix says it shouldn’t be forced to pay into funds that are designed to support the creation of Canadian content, arguing that the country is better served by market competition than by regulating foreign online services.

The California-based company makes the argument in a submission to a government-appointed expert panel that will make recommendations for changing Canada’s laws governing broadcasting and telecommunications.

“Numerous online distributors offer an abundance of content, including Canadian content, on demand, anywhere and any time to anyone with access to the open internet,” the Netflix submission says.

“We do not subscribe to the theory that a “regulated investment” is more valuable than a consumer and market-driven one.”

RELATED: VIDEO — Netflix Canada plans biggest price hike yet as rivals step up

The 30-page submission, made public Friday, says Netflix is on track to “significantly exceed” a $500-million commitment to fund original content made in Canada under a five-year agreement announced in 2017.

The paper, dated Jan. 11, is one of many submissions to the expert panel, which is expected to complete its review by Jan. 31, 2020 — after the next federal election in October.

Although the panel hasn’t made the full collection of submissions public, some groups have released theirs — often in support of positions that have been made in previous public debates.

Stephane Cardin, Netflix director of public policy, said Friday that the company decided to release its position paper ahead the 2019 Prime Time conference next week, when it will be on a panel with groups that had disclosed their positions.

Netflix argues that foreign online services such as itself would face unfair discrimination if it’s forced by law to pay into the Canadian Media Fund, which it says currently denies it the same rights as Canadian-owned broadcasters and distribution companies.

“For certified CanCon, the Canadian broadcaster obtains “first-window” rights in Canada while Netflix, or another online service, gets international rights outside Canada and possibly second-window rights in Canada,” it says.

If foreign online services are required to contribute to the CMF without getting “first window” rights in Canada, Neflix says, it would be discriminatory.

“It would also effectively force foreign online services to subsidize Canadian broadcasters, and reinforce the market power of vertically-integrated incumbents.”

Alternatively, it says, if foreign services had equal access to the CMF “they would be drawn into competing with Canadian broadcasters or VOD services for the Canadian first window rights for publicly funded original Canadian content.”

When asked by The Canadian Press whether Netflix was calling for an end to the Canadian Media Fund, where Cardin was a vice-president for 12 years, he was unequivocal.

“Absolutely not,” he said. “We do not say that, nor do we advocate for it.”

Netflix noted that it faces increased competition from other foreign and Canadian video-on-demand services, including Bell Media’s Crave subscription service, and the newer ad-supported CTV Movies and CTV Throwback.

The Canadian Broadcasting Corporation, which receives funding from the federal government and advertisers, has also launched its new Gem online service to provide live and on-demand programming.

Netflix said it’s not trying to get special treatment under Canadian tax laws, and noted it will begin collecting and remitting a Quebec sales tax in January 2019.

“We will comply with tax laws if and when they legally are extended to services like Netflix,” it says.


Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Police watchdog investigating after Abbotsford man seriously injured during arrest

Abbotsford police used ‘less lethal firearm’ and dog in arrest of man believed to have gun

Abbotsford woman releases book of poetry

Saniya Kaushal’s ‘you are not ugly’ addresses hurtful words and behaviours

UPDATED: Mission spray park closed after children suffer swollen eyes, burns

Mission RCMP are investigating incident that injured several children

VIDEO: Abbotsford Agrifair shares more about Drive-Thru Safari concept

Agrifair officials lay out plans for annual event, which runs from July 31 to Aug. 2

RCMP ask for assistance to find missing Chilliwack man

Raymond Gene Jarvis has been missing since early July

Recent surge in COVID-19 cases not unexpected amid Phase Three of reopening: B.C.’s top doc

Keep circles small, wear masks and be aware of symptoms, Dr. Bonnie Henry says

COVID-19 gives B.C. First Nation rare chance to examine tourism’s impact on grizzly bears

With 40 infrared cameras deployed in Kitasoo-Xai’Xais territory, research will help develop tourism plan with least impact on bears

RCMP searching for culprit behind needle-filled lemons left on Coquitlam-area trails

The two lemons found were thrown away leaving police with little evidence

NDP wants Lower Mainland MLA removed from BC Liberal caucus for alleged homophobia

BC Liberal leader, some MLAs apologize for Christian magazine ads but Laurie Throness doubles down

B.C. health officials pleased with likely extension of Canada-U.S. border closure

Health Minister Adrian Dix says the situation is ‘very serious in the United States’

‘Perfect storm’ led to bad year for mosquitos near Fraser River

High river levels and lots of rain meant many eggs hatched this year

South Surrey mom frustrated by city’s response after son, 10, has severe reaction to park grass 

City of Surrey parks manager says ‘potential steps’ to address concern under review

Thousands of dollars of stolen rice traced to Langley warehouse

Police raid seizes $75,000 in ‘commercial scale’ theft case

B.C. NDP changing WorkSafeBC regulations to respond to COVID-19

Employers say reclassifying coronavirus could be ‘ruinous’

Most Read