BillC-18 PriorityConcerns&ProposedAmendments INTRODUCTION● WesharetheGovernment’sobjectiveofensuringasustainableCanadiannewsecosystem.○ Wearealreadyoneofthebiggestnancial suppoersofjournalismintheworld○ Thisincludesvoluntarycommercial agreementsviaGoogleNewsShowcase;several streamsoffundingandpanershipundertheGoogleNewsInitiative;andofcourse,thevaluabletracwedrivetopublishers' websites■ Inthelastyearalone,wesentmorethan3.6billionvisitstoCanadiannewspublishers-atnocharge-helpingthemmakemoneywithadsandnewsubscriptions.ThistracdroveanestimatedCDN$250mwohofvalue● Unfounately,BillC-18,initscurrentform,ispuingtheseinvestmentsatrisk○ Specically,exemptionandarbitrationprovisions,alongwithasignicantexpansionofeligiblenewsbusinesses,areinconsistentwiththeobjectiveofsuppoingnewsbyincludingnon-newsmedia,andareunworkableforplaorms● Thepathforward:Wehaveasimplechoice.Eitherwecanamendthislegislationtothepolicygoalsthatweall suppoinaworkablemanner,orwewill belewithapieceoflegislationthatwill activelyharmtheCanadiannewsecosystemby:○ SlowingexistingsuppotoCanadiannewspublisherswhileplaormsseekclarity&ensurefairoutcomes;○ Suppoingoutletsthatdonotactuallyproducenews;○ Stiinginnovation;and○ IncentivizingproductchangesthatcouldreducetheavailabilityofnewstoCanadians● Wehavefourpriorityareasofconcerns,andproposedamendmentstoaddresstheseissues:○ Bylegislatingpaymentforlinks,C-18will radicallychangethelegal frameworkunderwhichwelinktonews,inamannerthatisbothinconsistentwithfundamental principlesoftheopenwebandinternational copyrightnorms,whileprovidingnomeanstomanagecosts;○ Inordertoincentivizevoluntaryagreements,C-18containsanexemptionprocess,butthecriteriatoobtainexemptionaresovagueandbroadtheywill havetheoppositeeect;○ Thescopeof“eligiblenewsbusinesses”undertheBillissobroadastopotentiallyincludeoutletsthatdonotproducenewscontent,andrequirementsthatoutletsadheretojournalisticstandardsarenotconsistentlyapplied;○ Thearbitrationprovisionsareveryheavilyweightedagainstplaorms,andwillprohibitarbitratorsfromproperlyweighingplaormcontributionsanddevisingcompromisesolutions; ISSUES&CONCERNS

1)PaymentforLinks ● TheBill establishes“makingnewscontentavailable”,whichexpresslyincludeslinkingtonewssites,asthebasisforpayment.● However,arbitrarilyrequiringanarrowrangeof“digital newsintermediaries”(DNIs)payaveryspecicclassof“eligiblenewsbusinesses”(ENBs)tolinktotheircontent:○ violatesfoundationalprinciplesoftheopenweb,iswhollyinconsistentwithinternationalcopyrightnorms(includingCanadiancopyrightlawandtheEuropeanCopyrightDirective)andraisesserioustradeissuesunderUSMCA,whichUSTRhasdirectlyaggedwithCdnGovt;○ incentivizesplaormstopaypublishersonaperlinkbasis,which■ benetsthosewithmorecontenttolinkto,namelylargepublishersoversmall publishers■ benetsceainbusinessmodels,suchasadsuppoed,overothers■ will incentivizesho-form,click-baitycontentoverlong-form,publicinterestjournalism,astheformerischeapertoproduceandplaormswill paybyvolume;○ failstorecognizetheverysubstantial valueplaormsprovidetonewspublishersintheformofreferral trac;and○ exposesplaormslikesearchenginestopotentiallyunlimited,uncappednancial liabilityformerelylinkingtonewscontent,whichseriouslyincentivizesplaormstoconsiderlimitingaccesstonewstoreducenancial exposure.

Solution: ReviseBill toalignwithinternational norms(includingEUCD&AUCode)byusingdisplayasbasisforpaymentandpreservingcopyrightlimitationsandexceptions. ProposedLegislativeText: Section2(2):Denitionof“MakingAvailable”

(2) ForthepurposesofthisAct,newscontentismadeavailableif(

a) thenewscontent,oranysubstantial poionofit,isreproduceddisplayedtothepublic;or(

b) accesstothenewscontent fromaneligiblenewsbusiness,oranypoionofit,isfacilitatedbyanymeans,includinganindex,aggregationorrankingofnewscontent. Section24:Copyrightlimitationsandexceptions 24 For greater ceainty, use of news content that is within the limitations and exceptions tocopyright under the Copyright Act shall not be included in the do not limit the scope of thebargainingprocess. 2)ClearandWorkableExemptionCriteria

● ThepurposeoftheBill istoincreasenancial suppofortheCanadiannewsindustryquickly.

Tofacilitatethisandincentivizevoluntaryagreements,theBill providesplaormsanoppounityforexemption.● However,currentexemptioncriteriaareincrediblyvagueandbroad,andprovidenoclarityonhowmanydealswouldbesucient● Fuher,theyrequireagreementswithoutletseveniftheyarenotonline,donotproducenewscontent,andtheDNIdoesNOTmaketheircontentavailabletoCanadians○ FundamentallydierentfromAU,wherewehadaclearindicationofwhatwouldberequiredtonotbedesignatedundertheCode.○ InAUweachievedthoserequirementsquicklythroughvoluntaryarrangements,whichiswhytheCodewasneverappliedtous.○ UnderC-18,wehavenoidea.C18stronglydisincentivesvoluntarydealsuntil thecriteriaarebothknownandachievable,whichwill slowtheowoffundstopublishers Recommendation: ReviseBill tomakeexemptioncriteriabothclearandreasonablyaainable.Specicallyaddclearandaainablenumerical guidelinesthatindicatewhatpropoionofnewsecosystemmustbecompensatedtoobtainexemption, andclarifythatCRTCcanalsoconsiderproposalsandnon-monetarysuppowhenevaluatingcontributionsforthepurposeofexemption.

ProposedLegislativeText: Section11:Exemptionorder 11(1) TheCommissionmustmakeanexemptionorderinrelationtoadigital newsintermediaryifitsoperatorrequeststheexemptionandthefollowingconditionsaremet:(

a) theoperator hasenteredintoarrangementsagreementswith,candemonstratethatitmadereasonable proposals to, or otherwise provides resources to eligible news businesses thatoperate newsoutletsthat producenewscontent primarilyfor theCanadiannewsmarketplacewithanaggregatereachof at least [X]%of theCanadianpopulationand, takenasawhole,thearrangementsagreements,proposalsandresourcessatisfythefollowingcriteria:(

i) theyprovidefor fair compensationtothenewsbusinessesforthemakingavailableofnewscontentthatismadeavailablebytheintermediary,(ii) they ensure that an appropriate poion of the compensation will be used bythenews businesses to suppo the production of local, regional and national newscontent,(iii) theydonot allowcorporateinuencetounderminethefreedomofexpressionandjournalisticindependenceenjoyedbynewsoutlets,(iv) they contribute to the sustainabilityof, andencourageinnovationin, theCanadiannewsmarketplace,(

v) theyensureasignicantpoionofindependentlocal newsbusinessesbenetfromthem, theycontributetothesustainabilityof thosebusinessesandtheyencourageinnovativebusinessmodelsintheCanadiannewsmarketplace,and(vi) they involve a range of news outlets in both the non-prot andfor-prot sectorsandtheywereenteredintowithnewsbusinessesthatreectadiversityofbusinessmodels that provide services to a variety of all markets and diverse populations,includinglocal andregional marketsineveryprovinceandterritory,anglophoneand

francophone communities, including ocial language minority communities, andBlackandotherracializedcommunities,and(vii) theyensureasignicant poionof Indigenousnewsoutletsbenetfromthemandthey contribute to the sustainability of those outlets in a way that suppos theprovisionofnewscontentbyandforIndigenouspeoples; (a. 1) the Commission has heldpublicconsultationsinaccordancewithanyconditionsthat itsChairpersonmayspecify;and (

b) anyconditionsetoutinregulationsmadebytheGovernorinCouncil.

(2) Theorderexemptstheoperator,inrelationtotheintermediary,fromtheapplicationof (

a) section 21 and any provision of any regulations madeunder

section 85 that isinrelationtosection 21;and (

b) any other provision of this Act and any provision of any regulations made undersubsection 81(1) or

section 85 that is specied by the Commission, in its discretion, intheorderforaperiodofXyearsfromthedateofitsissuance. …

(6) TheCommissionmust, byregulation, establishclear thresholdsforeachcriterionunderthissection. 3) LimitingtheScopeofENBs ● TheBillsignicantlyexpandedthenumberandrangeofoutletsthatwill beeligible,andcreatedinconsistenteligibilitycriteria,allowingsomebusinessestobeneteveniftheydonotproducenewscontent,whileothersmustadheretojournalisticstandards○ Forinstance,community&campusstationsareeligible,eveniftheydonotproducenewscontent,andhavenoobligationtoadheretoacodesofethics● ThisincentivizesDNIstoconsiderproductchangestolimitpotentialexposuretonon-newsoutlets Recommendation: ReviseBill toensureonlynewsbusinessesthatproducenewsandadheretojournalisticstandardsareeligible, addprocesstoevaluateCodeofEthicsandrequirementthatfundingbeinvestedinjournalism.

ProposedLegislativeText: Eligiblenewsbusinesses—designation 27

(1) At the request of a news business, the Commission must, by order, designate thebusinessaseligibleifit(

a) isaqualiedCanadianjournalismorganizationasdenedinsubsection248(1)oftheIncomeTax Act, or islicensedbytheCommissionunder paragraph9(1) (

b) of theBroadcastingActasa

campus station, community station or native stationasthosetermsaredenedinregulationsmade under that Act or other categories of licensees established by the Commission with asimilarcommunitymandate;or (

b) producesnewscontentofpublicinterestthatisprimarilyfocusedonmaersofgeneralinterestandreposofcurrentevents,includingcoverageofdemocraticinstitutionsandprocesses,and(

i) regularlyemploystwoormorejournalistsinCanada,whichjournalistsmayincludejournalistswhoownorareapanerinthenewsbusinessandjournalistswhodonotdeal atarm’slengthwiththebusiness,(ii) operatesinCanada,includinghavingcontenteditedanddesignedinCanada,(iii) producesnewscontentthatisnotprimarilyfocusedonapaiculartopicsuchasindustry-specicnews,spos,recreation,as,lifestyleorenteainment;or(iv) iseitheramemberofarecognizedjournalisticassociationandfollowsthecodeofethicsofarecognizedjournalisticassociationorhasitsowncodeofethicswhosestandardsofprofessional conductrequireadherencetotherecognizedprocessesandprinciplesofthejournalismprofession,includingfairness,independenceandrigourinrepoingnewsandhandlingsources;or (

c) operatesanIndigenousnewsoutletinCanadaandthatisprimarilyfocusedonproducingnewscontentthatincludesmaersofgeneral interest,includingcoverageofmaersrelatingtotherightsofIndigenouspeoples,includingtherightofself-governmentandtreatyrights. (1.1)anewsbusinessmayonlybedesignatedaseligibleunder(1)ifit(

a) iseither amember of arecognizedjournalisticassociationandfollowsthecodeofethicsofa recognized journalistic association or has its own code of ethics whose standards ofprofessional conduct require adherence to the recognized processes and principles of thejournalism profession, including fairness, independence and rigour in repoing news andhandlingsources;and (

b) ensuresthat compensationreceivedunder thisAct will beusedbythebusinesstosuppotheproductionoflocal,regional andnational newscontent; and (

c) anyconditionsetoutinregulationsmadebytheGovernorinCouncil. Codeofethics (1. 2) Thecodeof ethicsreferredtoinsubparagraph(1.1) (a)mustincludemeasuresforensuringthat no news content that promoteshatredor misinformationagainst anyidentiablegroupisproduced or made available and that any errors of fact are corrected promptly and in atransparentmanner.

(1.3) The Commission must, by regulation, establish a process to recognize a journalisticassociation for the purposes of subsection (1.1)(

a) that includes an assessment of itscodeofethics by an independent expe advisory body and a requirement that theCommissionholdpublic consultations on whether the association be deemed a recognized journalisticassociationforthepurposesofsubsection(1.1)(a).

(1.4) The Commission must maintain a list of recognized journalistic associations and publishthatlistonitswebsite.

(2) TheCommissionmaymakeanorder under subsection(1) onitsowninitiativeshall takeintoaccount anyrecommendationsofanybodyestablishedforthepurposeofdeterminingwhetheranewsbusinessisaqualiedCanadianjournalismorganizationasdenedinsubsection248(1)of theIncomeTaxAct,oranyequivalentadvisorybodyestablishedtodetermineeligibilityundersubsection(1),beforemakinganorderundersubsection(1). 4)FairArbitration ● New,stricterprovisionswereaddedtothearbitrationsection,makingalreadybiasedprovisionsevenmoreheavilyweightedagainstDNIs○ Currentversionofnal oerarbitrationessentiallyensuresDNIoerswill berejected,eveniftheDNIonlyminimallymakesanENBs’ newscontentavailable● Fuher,newxedtimelinesfornegotiationanddisputeresolutionwereaddedthatwillincentivizeENBstosimplywaitouttheclockratherthannegotiateingoodfaith,andwill preventDNIsfromprovidingevidencesuppoingtheiroerorevenchallengetheeligibilitystatusofanENB● Unreasonabletimelinesandunfairprocesseswillinvitechallengesandlikelyfuherdelayowoffunds Recommendation: ReviseBill tochangenal oerarbitrationtostandardcommercialarbitration(withexpeditedtimelines)andallowCRTCtoextendtimelinesforbargaining,mediationandarbitration.

Alternatively, reviseguidancetothearbitrationpanel sotheycanassessonavailableevidenceandrecognizethevalueexchangebetweenplaormsandpublishers. ProposedLegislativeText: Stepsinbargainingprocess19

(1) Thebargainingprocessconsistsof(

a) negotiationorbargainingsessionsoveraperiodof90days;(

b) if thepaiesareunable,withinthenegotiationorbargainingperiod,toreachanagreement,mediation sessions over a period of 120 days, beginning on the day aer the end of thenegotiationorbargainingperiod;and(

c) ifthepaiesareunable,withinthemediationperiod,toreachanagreementandatleastoneof the paies wishes to initiatearbitration, nal oer anarbitrationprocessfor aperiodof 45days,beginningonthedayaertheendofthemediationperiod.Extension(1. 1) Onrequestofeitherbothpayiesorinitsowndiscretion,theCommissionmayextendaperiodprovidedforinanyofparagraphs(1) (a)to(c) …Scopeofnaloerarbitration(3) Anynal oerarbitrationunderthebargainingprocessislimitedtomonetarydisputes. …Mediationandnaloerarbitration25 For greater ceainty, theuseof newscontent isnottobethesubjectofmediationsessionsornal oerarbitrationduringthebargainingprocessiftheoperatorinquestion

(

a) hasmadepaymentstotheeligiblenewsbusinessinquestionfor theuseof that content inaccordancewithalicenceoragreementbetweentheoperatorandthebusiness;or(

b) hasmadepaymentsorhasoeredtomakepaymentstothebusinessinquestionfortheuseof that content inaccordancewiththerelevant tariapprovedbytheCopyright Boardfor theuseofthatcontent.…Arbitrationpanel34

(1) An nal oer arbitration must be conducted by a panel that is composed of threearbitratorswho(

a) areselectedbythepaiesfromtheroster;or(

b) areappointedbytheCommissionfromtheroster,ifthepaiesdonotselectthearbitratorswithin20daysaperiodthattheCommissionconsidersreasonable.…Commissionassistance36 The Commission may, at the request of an arbitration panel, provide administrative andtechnical assistance to the panel and may, on any terms that the Commission considersnecessary, disclose to the panel any condential information in the Commission’s possessionthat, in the Commission’s opinion, is necessary for a balanced and informeddecision-makingprocess, on the condition that the Commission ensures that the arbitration panel or eachindividual arbitratorthatpresidesoverthenal oerarbitration,donotfuherdiscloseanysuchcondential informationandunderanyfuhertermsthattheCommissionconsidersnecessary.

Decisionofarbitrationpanel37 The arbitration panel makes its decision by selecting the nal oer made by one of thepaies. Factors38 Anarbitrationpanel musttakethefollowingfactorsintoaccountinmakingitsdecision:(

a) thevalueadded, monetaryandotherwise,tothenewscontentinquestionbyeachpay,asassessed in terms of their investments, expenditures and other actions in relation to thatcontent;and(

b) the benets, monetary and otherwise, that each pay receives from the content beingmadeavailablebythedigital newsintermediaryinquestion.;and(

c) thebargainingpower imbalancebetweenthenewsbusinessandtheoperatorofthedigitalnewsintermediaryinquestion. Dismissalofoers39

(1) Anarbitrationpanel mustdismissanyoerthat,initsopinion,(

a) allows a paytoexerciseundueinuenceover theamount of compensationtobepaidorreceived;(

b) is not in the public interest because the oer would be highly likely to result in seriousdetrimenttotheprovisionofnewscontenttopersonsinCanada;or(

c) is inconsistent with the purposes of enhancing fairness in the Canadian digital newsmarketplaceandcontributingtoitssustainability. EectofDismissal(2) If thearbitrationpanel dismisses, inaccordancewithsubsection(1), thenal oermadebyoneofthepaies,itmustacceptthenal oermadebytheotherpay. Reasonsandnewoers

(3) If thearbitrationpanel dismisses, inaccordancewithsubsection(1),thenal oermadebyeachof thepaies, it must providewrienreasonstothepaiesandgivethemanoppounitytomakeanewoer. …Decisionnotacceptedbythepaiesdeemedtobeagreement42 If anarbitrationpanel’sdecisionisnotacceptedbythepaies,deemed,forthepurposesofits enforceability, tobeanagreement enteredintobythepaiesthedigital newsintermediarymust promptlyceasemakingavailablethecoverednewscontent of theeligiblenewsbusinessorgroupofeligiblenewsbusinesses. Alternatively: Factors38 Anarbitrationpanel musttakethefollowingfactorsintoaccountinmakingitsdecision:(

a) thevalueadded, monetaryandotherwise,tothenewscontentinquestionbyeachpay,asassessed in terms of (

i) their investments, expenditures and other actions in relation to thatcontent or its making available, and (ii) thenumber of Internet visitorsreceivedbytheeligiblenewsbusinessbywayofthedigital newsintermediary;and (

b) the benets, monetary and otherwise, including Internet visitorsreceived, that eachpayreceivesfromthecontentbeingmadeavailablebythedigital newsintermediaryinquestion;and (

c) thebargainingpower imbalancebetweenthenewsbusinessandtheoperatorofthedigitalnewsintermediaryinquestion. DismissalofoersEvidence39

(1) Anarbitrationpanel mustdismissanyoerthat,initsopinion,(

a) allows a pay toexerciseundueinuenceover theamount of compensationtobepaidorreceived; (

b) is not in the public interest because the oer would be highly likely to result in seriousdetrimenttotheprovisionofnewscontenttopersonsinCanada;or (

c) is inconsistent with the purposes of enhancing fairness in the Canadian digital newsmarketplaceandcontributingtoitssustainability. The arbitration panel must rely on evidence submied by the paies to assess each of thefactorssetoutinsection38. EectofDismissal(2) If thearbitrationpanel dismisses, inaccordancewithsubsection(1), thenal oermadebyoneofthepaies,itmustacceptthenal oermadebytheotherpay. Reasonsandnewoers(3) If thearbitrationpanel dismisses, inaccordancewithsubsection(1),thenal oermadebyeachof thepaies, it must providewrienreasonstothepaiesandgivethemanoppounitytomakeanewoer.