US Republicans put Canada’s Online Streaming Act in crosshairs amid wider trade talks

Canada’s long-running attempts to make US streamers contribute towards funding local productions have become the target of a Republican bill designed to squash the Online Streaming Act (OSA).

Lloyd Smucker

WikiMedia Commons

Republican Lloyd Smucker last week introduced the Protecting American Streaming and Innovation Act, a piece of legislation that directs the United States Trade Representative (USTR) to investigate whether the OSA “discriminates against or burdens American commerce.”

If the investigation finds the Canadian law is discriminatory, the USTR would be directed to take “retaliatory action,” which could include imposing higher tariffs on Canada across a spectrum of industries.

The introduction of the bill comes amid a broader trade war between the US and Canada. The countries are due to begin high-stakes negotiations on the Canada-United States-Mexico Agreement (CUSMA) this summer.

While film and TV is not as high a priority as sectors such as steel/aluminium, automotive, energy and agriculture, the OSA has been frequently referred to as an “irritant” in the context of these broader trade conversations. For months, fears have been growing that the OSA could be used as a bargaining chip when the US and Canada sit down to begin formal CUSMA negotiations.

First passed into law in 2023, the OSA brought about an amendment to the Canadian Broadcasting Act that brings foreign-based streaming services, including the likes of Netflix, Disney+ and Prime Video, under local regulation with a view to making them pay into the local broadcasting system.

However, the OSA has not been fully implemented yet as Canada’s TV regulator, the Canadian Radio-Television and Telecommunications Commission, has not decided how much these streaming services are required to contribute. An official decision had been expected last month, however it did not arrive. There is no firm timeline on when the decision will be announced.

“Digital trade plays a critical role in America’s economy, supporting high-paying jobs and exporting American values. Canada’s unfair policies stack the deck against US companies, creators and workers. This bill would protect American creators and companies while permitting mutually beneficial competition and innovation,” said Smucker.

Smucker’s bill is co-sponsored by five other Republican congressmen and supported by several other non-political groups including the Motion Picture Association (MPA) and Digital Media Association.

Charles Rivkin, chairman and CEO of the MPA, said: “Canada’s Online Streaming Act disadvantages American companies and undermines competitiveness by requiring streaming companies to subsidise and promote Canadian content over their own productions through discriminatory obligations that Canadian broadcasters do not face. We applaud Smucker’s commitment to addressing this unfair trade practice that’s impacting film and television production in America.”

The introduction of the Republican bill does not mean it will be passed, but it does illustrate once more that the OSA is in danger of becoming a casualty of wider trade talks.

Smucker’s bill contends that the OSA imposes “costly financial and regulatory burdens on US-based digital services while exempting Canadian competitors.” However, the local Canadian industry has pushed back strongly on this, reiterating that the goal of the OSA is to level the playing field by making US-based streamers subject to similar regulations as local Canadian broadcasters.

“At its core, the Online Streaming Act is about fairness, recognising how content is consumed in the digital age and ensuring that online streaming platforms carry requirements similar to those of traditional broadcasters,” said the Canadian Media Producers Association in a statement following the introduction of Smucker’s bill

“By bringing these platforms in line with the rest of the industry, we can level the playing field and help secure a future where Canadian stories are supported, funded and accessible across platforms available to, and paid for by, Canadians.”