Netflix to stop funding Canadian arts, culture over Trudeau's Online Streaming Act after investing $25 million, creating 1,200 jobs

Netflix is cutting funding to Canadian arts and culture projects worth $25 million and responsible for the creation of 1200 jobs in response to Prime Minister Justin Trudeau’s Online Stream Act, or Bill C-11. The legislation, passed 17 months ago, forces online broadcasters to meet Canadian content mandates.

In an announcement last week, the company said it would be cutting funding to arts and entertainment training and development initiatives that it invested in since it expanded to the Canadian market in 2017. The decision is a result of the Online Streaming Act’s Canadian content rules that allow the Canadian Radio-television and Telecommunications Commission (CRTC) to extort 5 percent of an online media outlet’s domestic revenue to Canadian projects, True North reported.

“The CRTC moved ahead with Bill C-11 mandated streamer payments without addressing issues such as what constitutes Cancon and what existing payments will be counted as contributions. This was the inevitable response: Netflix pulls millions in sponsorship,” law professor and Canada Research Chair in Internet and E-commerce Law Michael Geist posted on X.

Netflix said in a statementm “despite our long-standing commitment, the government has chosen not to acknowledge our substantial support for the Canadian film and TV sector. Consequently, we will be unable to continue funding many of the programs that have come to rely on our backing, as we are now required to allocate resources to meet the CRTC’s new investment mandate."

Netflix is not the only arts and entertainment company refusing to toe the line with the Trudeau government. The Motion Picture Association-Canada, which represents a broad section of the entertainment industry like Walt Disney, Warner Bros. Discovery, and Paramount Global Productions is challenging Federal Court over the CRTC measures in July. According to the group, the CRTC “acted unreasonably” in imposing this requirement.

“The CRTC’s decision to require global entertainment streaming services to pay for local news is a discriminatory measure that goes far beyond what Parliament intended, exceeds the CRTC’s authority, and contradicts the goal of creating a modern, flexible framework that recognizes the nature of the services global streamers provide,” said Wendy Noss, president of the Motion Picture Association Canada, in a statement.

Geist said the “multiple legal and trade challenges, Netflix canceling sponsorships, Facebook blocking news links, and Google adding digital ad surcharges” should have been expected by the Trudeau government since they had plenty of opportunity to notice “repeated warning signs” which they “ignored.”

The Trudeau government has continued to harass online media with censorship legislation, including Bill C-63, or the Online Harms Act, that provides life imprisonment for a “hate crimes offense.” It has passed the first reading in the House of Commons and will continue to be addressed by Members of Parliament in the fall. The bill includes a thought crime component that could result in house arrest for offenders.