Netflix, Spotify, Amazon, Apple and others to fight against Canada's Bill C-11 that they see as 'Streaming/Hidden Tax': What makes the court fight important

Time of India

3 days ago

On Monday, June 9, 2025, tech and streaming giants Netflix, Spotify, Apple, and Amazon will appear before Canada's Federal Court of Appeal to challenge the Canadian Radio-television and Telecommunications Commission's (CRTC) regulations under the
Online Streaming Act
(Bill C-11).
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Passed in April 2023, the law mandates that streaming services earning over $25 million annually in Canada contribute 5% of their Canadian revenues to support Canadian content, including Indigenous, francophone, and local independent news programming. The CRTC estimates this will generate approximately $200 million annually to bolster Canada's cultural and media sectors. However, the legal showdown has ignited a broader debate about fairness, cultural identity, and the future of digital regulation.
Spotify and others calls it Hidden Tax
The challengers -- Apple, Amazon, Spotify, and the Motion Picture Association–Canada (representing Netflix, Disney, Paramount, and others) -- argue that the CRTC's rules overstep its authority under Canada's Broadcasting Act. Spotify has labeled the 5% contribution a 'hidden tax,' asserting it unfairly burdens foreign streaming platforms. Amazon contends that the regulations discriminate by imposing stricter requirements on international services compared to Canadian media companies, which face different obligations.
Apple has called the levy 'premature and inequitable,' noting that streamers are required to contribute five times more than traditional radio broadcasters while being denied access to the very funds they support.
The Motion Picture Association–Canada has taken particular issue with a 1.5% contribution to a local news fund, arguing that streaming platforms do not produce news, hold no news licenses, and cannot access the funds they are mandated to support.
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'This is a policy mismatch,' said a spokesperson for the association. 'Streamers are being asked to subsidize a sector they don't operate in, without any reciprocal benefit.'
Netflix, Spotify and others have created funding crisis, claims traditional Canadian media
On the other side, the Canadian Association of Broadcasters (CAB) argues that traditional media outlets have long shouldered the responsibility of funding Canadian content while global streaming platforms have operated without similar obligations.
The CAB warns that the rise of streaming services has exacerbated a funding crisis for local news and independent media, with many outlets struggling to survive in an increasingly digital landscape.
The debate extends beyond the courtroom, touching on questions of cultural identity and economic fairness. However, critics warn of unintended consequences. Some analysts have cautioned that the 5% levy could lead to higher subscription costs for consumers or prompt streaming services to exit the Canadian market entirely.
He pointed to Spotify's recent withdrawal from France after similar regulations were imposed as a potential precedent.
What makes the court's decision important
The Federal Court of Appeal is expected to deliver its ruling by late summer 2025. The decision could reshape the regulatory landscape for digital platforms in Canada, determining whether the CRTC's rules are upheld, modified, or struck down. A ruling in favor of the streamers could weaken the Online Streaming Act's framework, potentially jeopardling calls for legislative amendments.
Conversely, upholding the CRTC's authority could embolden other countries to adopt similar measures, intensifying global tensions between tech giants and regulators.