A group of U.S. Republican lawmakers have expressed concerns over Canada’s policy mandating foreign streaming services to allocate five percent of their revenues to support Canadian content, labeling it as discriminatory and urging its retraction during trade talks. In a letter addressed to U.S. Trade Representative Jamieson Greer, Commerce Secretary Howard Lutnick, and Treasury Secretary Scott Bessent, the 18 Republicans criticized the Canadian Online Streaming Act as biased against American firms.
The signatories of the letter, including Lloyd Smucker, Carol D. Miller, Ron Estes, and Rudy Yakym, highlighted the significant economic contributions made by American streaming services to the U.S. economy. They criticized the Canadian Radio-television and Telecommunications Commission (CRTC) for compelling foreign services to contribute to government funds that support Canadian content creation, arguing that it hinders cross-border digital trade.
The letter obtained by CBC News emphasized the substantial economic impact of on-demand video revenue and music streaming in the U.S. The Republicans urged prioritizing the digital trade sector in ongoing negotiations with Canada to address these concerns.
In late June, the Canadian government announced the repeal of its digital services tax following pressure from U.S. President Donald Trump, who temporarily halted trade negotiations until the tax was removed. Despite the resumption of negotiations after the tax repeal, they did not meet Trump’s self-imposed deadline, leading to increased tensions, including the imposition of a 35 percent tariff on non-compliant goods under the Canada-U.S.-Mexico agreement (CUSMA).
Prime Minister Mark Carney faced criticism for acquiescing to U.S. demands, contrary to his earlier promises of a strong stance against Trump. Legal expert Michael Geist noted that Carney’s government has shown a willingness to reverse digital policies enacted during Justin Trudeau’s tenure, raising concerns among U.S. streaming companies and politicians about the possibility of changes to the Online Streaming Act.
Geist highlighted the controversial aspects of the legislation, particularly its narrow definition of Canadian content, which excludes many foreign streamers from benefiting from Canadian content funds. He also mentioned the exclusion of Canadian filmmakers from potential funding, as reported by The Globe and Mail. Geist underscored the need for policymakers to consider the consequences of such decisions, emphasizing the importance of recognizing the impacts of policy choices in various areas.