Bill C-18 (Link Tax) Passes Committee, Moves on to Third Reading in House of Commons

Canada’s bill C-18 (AKA Link Tax legislation) has passed the House of Commons committee process. It now moves on to third reading.

The second wave of the Liberal governments war on the open internet has cleared another hurdle. On Friday, the disastrous bill passed the House of Commons committee stage. What this means is that it will move on to third reading at the House of Commons level.

The legislation still faces the Senate process which contains first, second, and third reading as well as the possibility it could be considered for a committee process. So, a battle is definitely looming next year over two possible futures in the world of news. One possible future is that this bill is stopped dead in its tracks and journalism continues to evolve and improve as more and more interact with the online world. The other future is that the bill passes and the biggest players either get a massive payday while applying considerable permanent financial pressure on smaller players like us or social media begins blocking Canadian links and cuts off a huge way for smaller players to reach new audiences.

Distressingly, all of this puts at risk nearly a decade of effort I personally put into this website. While the recent changes in Bill C-11 means that Freezenet could technically still survive on platforms like YouTube, Twitch TV, and TikTok, the possibility that this website would be blocked from numerous avenues of expansion would, nevertheless, be a devastating blow.

After all, one of the big points this website was set up was so that I would no longer have to work my careers around the whims of another website administrator or moderation team and that I could basically be my own boss for a change. Laws ensuring that the viability of this website would never actually come to fruition would mean that I stand to lose almost everything for a third time in my whole career – a process I never wanted to ever repeat again. For me personally, it’s horrifying to think about.

While I can speak for myself what this bill potentially means, it’s not just about myself and Freezenet. This bill hurts everyone involved. Already, many news organizations have signed a petition to stop Bill C-18 from hurting this important sector. Freezenet, of course, has signed this petition. Meanwhile, over at OpenMedia, average, every day Canadians can sign another petition to try and join the effort to put a stop to the damage this bill will inevitably do to journalism if left unamended.

As for the legislation itself, there are numerous problems with the bill. As I pointed out in my analysis of the bill, provisions force platforms to pay for all linking to any news article. Outlets wishing to not partake in such a scheme are banned from opting out of such a scheme. Platforms have to pay for those news links no matter what the outlets think about all of this. At the same time, smaller outlets such as Freezenet would face eligibility requirements that makes it impossible to qualify for any payments. Specifically, the requirements that demand separate arms length journalists and not being focused on a “particular topic” which could mean just about anything.

Incidentally, those same latter provisions could very easily force platforms like Google and Facebook to fund state sponsored foreign misinformation campaigns as such provisions would be trivial for a government like Russia to circumnavigate – something that raises the possibility that platforms could wind up being legally obliged to break sanctions against countries like Russia. This is because platforms can’t block obvious misinformation campaigns as the law forbids them from picking and choosing who would benefit from the link tax.

During the committee process, an amendment was added so that traditional broadcasters would not even need to produce news to benefit from the link tax law. A simple CRTC license would be enough to qualify to start raking in platform cash. The amendment obliterates the already weak argument that this was about supporting journalism. All that is left in its wake is a government picking winners and losers in this bill – with legacy establishment publishers being winners and their competitors – such as us – being the losers.

That point was compounded by a Parliamentary Budget Officer pointing out that as much as 75% of all the revenues being gathered would be funnelled to the heavily subsidized establishment players like the CBC, CTV, Bell Media, and a select few other benefits. That leaves the entire rest of the sector fighting over the scraps that make up the remaining 25% of revenues gathered.

Of course, the idea that any money being potentially collected has run up against the hard reality that Facebook could very easily block news links altogether in the country. Facebook renewed back in October that blocking news links in Canada is very much still on the table. This after it was found that 4 in every 1,000 links posted on Facebook’s main feeds points to a news organizations article. That revelation came about as Facebook informed American publishers back in August that they are ending agreements to pay for linking as well as laying off 13% of its staff as a cost cutting measure last month.

Adding another headache for the Liberal government is the fact that the US ambassador to Canada has, earlier this month, renewed the countries concerns over Bill C-11 and Bill C-18. That news was a follow-up to a CCIA white paper which pointed to several CUSMA articles that Bill C-18 violates. As a result, the risk is that the US could slap trade tariffs on Canada dollar for dollar on what they are extracting from the platforms. After all, from the American perspective, both Bill C-11 and C-18 overwhelmingly target US businesses in the first place.

Back at home, there is also the serious risk this poses to something as basic as freedom of expression. For that, Michael Geist has pointed this out back in early November:

Aside from the obvious unfairness, the broader implications of this policy are even more troubling. Once government decides that some platforms must pay to permit their users to engage in certain expression, the same principle can be applied to other policy objectives. For example, the Canadian organization Journalists for Human Rights has argued that misinformation is akin to information pollution and that platforms should pay a fee for hosting such expression much like the Bill C-18 model. The same policies can also be expanded to other areas deemed worthy of government support. Think health information or educational materials are important and that those sectors could use some additional support? Why not require payments for those links from platforms. Indeed, once the principle is established that links may require payment, the entire foundation for sharing information online is placed at risk and the essential equality of freedom of expression compromised.

To be clear, supporting journalism is important. But Bill C-18’s dangerous approach ascribes value to links where there isn’t any, regulates which platforms must pay in order to permit expression from their users, and dictates which sources are entitled to compensation. This is an unprecedented government intervention into the media and freedom of expression. If the government believes that Facebook and Google should be paying more into Canada, tax them and use the funds for journalism support. If that isn’t enough, create a fund for participation in the news system with mandated contributions similar to the Cancon broadcast world. That may not be ideal, but it would at least keep the system arms length, remove the qualification issues, and reduce the market intervention. 

I suspect the government fears that Canadians would easily recognize the risks associated with mandated payments for links and fundamental unfairness with the system envisioned by Bill C-18. It is why it has misled on the inclusion of link payments, rejected the Parliamentary Budget Officer’s estimates on who benefits, and sought to frame Facebook’s concerns as a threat, when the real threat lies in the bill itself. But despite those efforts, make no mistake: Bill C-18 is a law about forcing some platforms to pay for links. It gives the government the power to regulate who pays and which expression is worthy of payment. In doing so, it creates a threat to freedom of expression for all Canadians.

Indeed, Freezenet would only just be one casualty of many. While Freezenet would technically survive this because of the ways I have fortified this website over the last decade from potentially being completely cut off from social media and platforms, there is no way to ensure that this surviving would be in any ways pleasant. It just means other assets would have to perform all the heavy lifting to keep the website afloat such as the Wiki, Youtube, and the official podcast. The efforts were put in place to protect from a different threat altogether, but it was thanks to this early years paranoia that even if this bill passes as-is, Freezenet will actually survive this.

For other news websites, however, the situation is much more grim. The idea of suddenly being cut off from something like Facebook would be devastating, potentially killing off such a news outlet altogether in the process. Some outlets may be forced to move out of the country altogether just to ensure that they survive while others may not have the resources to make such a big move – which includes possibly moving servers, domain names, and critical infrastructure over top of physically moving. So, indeed, for those worried about the implications of freedom of expression, there is very good reason to worry.

All indications suggest that a number of points of history in Bill C-11 is going to repeat with the Bill C-18 process. Already, the bills supporters, such as Liberal MP, Lisa Hepfner, accused online outlets of being “not news“, a point she would later apologized for. Later on, another media outlet called online news outlets “questionable“, showing that this was not a one-off remark among supporters.

The above is already repeating history of Bill C-11 since Bill C-11 supporters accused online creators of not being “real art” and pushing through the bill ensuring that online creators would never see a single nickel out of provisions requiring platforms to contribute into funding supposedly going to help creators make content. Instead, the system being set up ensures that only the establishment and well connected will ever receive that funding in the first place. So, the parallels are disturbingly similar between Bill C-11 and Bill C-18.

While the Senate is unlikely to begin looking at Bill C-18 until the new year, the new year really isn’t that far away. So, after going through a particularly ugly debate on Bill C-11, Canadians will find themselves getting ready for a second round of ugly debate with Bill C-18. Like it or not, it’s coming soon.

Drew Wilson on Twitter: @icecube85 and Facebook.

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