The Canadian government will instruct the country’s broadcast and telecommunications regulator to reconsider its recent decision to triple the financial contributions that streaming services such as Netflix are required to make toward Canadian content.

According to the Heritage Department, the new requirements set by the Canadian Radio-television and Telecommunications Commission (CRTC) could lead to increased costs for streamers, potentially resulting in higher prices for Canadian consumers. Prime Minister Mark Carney emphasized the importance of not burdening Canadians with additional costs during a press briefing following a cabinet meeting.

To support the stability and accessibility of Canada’s audio and audiovisual sectors, the government announced a $600 million investment. This funding aims to ensure that Canadian culture remains affordable and available to all citizens.

The Online Streaming Act, which was enacted in 2023 under the previous Trudeau administration, empowered the CRTC to mandate that streaming companies generating at least $25 million in annual Canadian revenue allocate a portion of their earnings toward supporting Canadian content production, including movies, television shows, and local news.

Initially, the CRTC had set the minimum contribution at five percent of a company’s Canadian revenue but subsequently increased it to 15 percent last month. As a result, the government will issue a new policy direction to the CRTC to revise its implementation of the Online Streaming Act.

The Motion Picture Association, a U.S.-based group representing streaming services, had urged the cabinet to reconsider its stance. U.S. Ambassador to Canada Pete Hoekstra welcomed the decision to review the contribution hike, emphasizing the importance of creating a fair and conducive framework for American companies to invest in Canada’s creative industry.

While the Broadcasting Act does not grant cabinet the authority to directly overturn regulatory decisions, it can provide directives to the CRTC on the broader implementation of the act. The CRTC confirmed its awareness of the forthcoming directive from the government to adjust the implementation of the Online Streaming Act and stated that it would review any new policy directions upon release.

Minister of Identity and Culture Marc Miller acknowledged the listing of the Online Streaming Act as a trade irritant but highlighted the financial challenges faced by the industry. The government is currently evaluating the specifics of its directive to the CRTC, with a commitment to ensuring that platforms continue to contribute to Canadian content creation.

Miller clarified that the review’s timing coinciding with U.S. trade negotiations was coincidental, emphasizing that platforms would still be expected to support the Canadian content industry.