Trump’s attacks on the film industry has renewed concerns that the Online Streaming Act could be in Trump’s crosshairs again.
US dementia patient, Donald Trump, has been improvising his way through trying desperately to make the tariffs work no matter how much they don’t work. The other day, one of the things he randomly decided to target was the film industry. It was, like everything else, completely improvised and just randomly thought of one day (given that it was announced through social media, Trump was probably on the can at the time).
The White House staff, of course, wasn’t aware that this would be randomly thought of by Trump, but said in response that they are “on it”. This as they begin their usual scramble to think of some way to make it all happen since there was no real planning or forethought put into any of this.
Of course, the real question in all of this is how one would practically carry out tariffing “foreign” made films. Film producers, after all, rely on “foreign” services for things like special effects. Others film on different locations. It’s a whole pile of complexity that, for obvious reasons, needs to be explained out.
Now, a longstanding problem between Canada and the US is the Online Streaming Act (formerly Bill C-11). For observers, Trump is nudging pretty close to this trade weakness. With the effort to go after the film industry, some are thinking that this could spill over into the Online Streaming Act debate. From the Globe and Mail (probably paywalled):
A body representing several U.S. platforms called Tuesday for a halt to the implementation of Ottawa’s Online Streaming Act, which has yet to be fully enacted by Canada’s broadcasting regulator.
Adam Taylor, a trade expert representing U.S. movie studios and streaming platforms, said foreign interactions with the U.S. screen industry are now “fully in the crosshairs of the Trump administration,” and the act – which was known as Bill C-11 – is likely to become another sticking point in trade negotiations.
Mr. Taylor said that “with the Trump administration targeting Canada’s film industry,” it is only a matter of time before the Online Streaming Act moves up the agenda in Washington.
He said he thinks Canada should put revisiting the act on the table with the White House to stop the issue from escalating.
“We know that the U.S. Trade Representative has already flagged the Online Streaming Act as a bilateral trade issue of concern that discriminates against U.S. companies, and so we should fully expect that this issue is now in the basket of other bilateral trade issues that are going to need to be negotiated,” he said.
This is something I have warned about from the very beginning of this whole sorry saga of the Online Streaming Act. Over top of the other nightmarish problems this creates (such as the downranking of user generated content which raises huge constitutional problems in and of itself), there is the fact that it opens up trade vulnerabilities for Canada. Despite the head in sand denials from the government at the time, the Online Streaming Act is a very obvious trade violation of CUSMA/USMCA. This is because it specifically targets US firms in a discriminatory way. Even worse is the fact that Canada has no viable defence should the US decide to go after Canada on this front.
As recently as last month, the US issued a report listing the Online Streaming Act, the Online News Act, and the Digital Services Tax as trade barriers between the US and Canada. What can I say? The US is not wrong on that. After all, all three laws are obvious violations of Canada’s international trade obligations. For those who think this is a partisan issue, during the Biden administration, the US was already in the process of setting up a trade dispute panel in response to the then called Bill C-11 legislation. Neither Democrats nor Republican’s are happy with this bad bill.
At this point, the smart move on Canada’s part would be to finally rescind the Online Streaming Act, the Online News Act, and the Digital Services Tax before it becomes a serious problem when communicating with the US on issues of trade. At least at that point, the country would eliminate all of their weaknesses on the trade front. After all, the last thing Canada needs is to have vulnerabilities in dealing with the lunatic in the White House. This latest report suggests that Trump has been made aware of this weakness and is likely all too happy to exploit that. The best that Canada can hope for at this stage is that Trump forgets about this weakness and gets distracted by something else (not impossible, but not something you should bank on).
Of course, just because it’s the smart and logical thing to do doesn’t necessarily mean Canada will do it. In fact, it could be a reason for Canada not to do that because Canadian lawmakers have been known to being allergic to doing logical things. In this case, there is the fact that the heavily protected and subsidized culture lobby has been demanding that these laws get put in place to crack down on Canadian competitors online and give them a permanent advantage in the form of free money. After all, they have already effectively stolen millions from the internet. The last thing they want is that free money gravy train to come to an end and be forced to actually earn anything in this day and age. So, there is a strong deterrent for the government to do the right thing and rescind these laws in the first place.
All this leads to things likely getting ugly for Canada in the future. Trump’s team could very easily pick up on the weakness that Canada has through the Online Streaming Act. Canada’s options, apart from doing a half-baked challenge that likely leads nowhere, appears to be extremely limited here if the US were to pursue that option. Should the US pursue this further, someone in Canada isn’t going to be happy one way or another.
(via @mgeist.bsky.social)
