Streaming services challenge Canadian rules on revenue-sharing for news
OTTAWA, July 4 (Reuters) -Global streaming companies said on Thursday they were challenging new Canadian rulesthat oblige them to help pay for local news, saying Ottawa had acted unreasonably and provided no legal basis for the demand.
The Canadian Radio-television and Telecommunications Commission (CRTC), the national broadcasting regulator, said in June that major online streaming services must contribute 5% of their Canadian revenues to support the domestic broadcasting system, including news generation.
The Motion Picture Association-Canada, which represents firms including Netflix NFLX.Oand Disney+, has filed applications in a federal court for leave to appeal the rules and also ask for a judicial review.
"The decision does not reveal any basis for the CRTC's conclusion that it is appropriate to require foreign online undertakings to contribute to news production," it said in a legal filing.
"The CRTC acted unreasonably in compelling foreign online undertakings to contribute monies to support news production."
The CRTC said the funding would be directed to areas of what it called immediate need in the broadcasting system, such as local news on radio and television, French-language content, and Indigenous content.
The regulator did not immediately respond to a request for comment. It says the rules, which come into effect in September, will raise roughly C$200 million ($146 million) a year.
The measure was introduced under the auspices of a law passed last year that the government says will ensure that online streaming services promote Canadian music and stories, and support Canadian jobs.
Other streaming platforms the MPA-Canada serves include Paramount, Sony 6758.T, NBCUniversal and Warner Bros Discovery.
Reporting by Ismail Shakil, editing by David Ljunggren and Diane Craft
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