Canada Halts Ads on Meta Platforms Amid Legal Dispute Over Online News Act

In a recent development, Canadian Heritage Minister Pablo Rodriguez announced that the Canadian government will suspend advertising on Meta platforms, including Facebook and Instagram. This decision is a direct response to the ongoing disagreement regarding the newly passed Online News Act, or Bill C-18. The legislation, enacted last month, mandates tech giants like Meta and Google’s parent company Alphabet to compensate online news publishers for their content.

Meta and Alphabet have both indicated their intention to discontinue news services on their platforms in Canada as a reaction to the law. Prime Minister Justin Trudeau, speaking in Monteregie, Quebec, affirmed Canada’s stance on ensuring fair compensation from these internet platforms for the use of media content.

The Canadian government is in the process of finalizing regulations that will require these platforms to allocate a portion of their advertising revenue to news publishers. The law is expected to be fully implemented by the end of the year. Minister Rodriguez, who introduced the bill in 2022, expressed optimism about resolving the dispute and remains open to discussions with the platforms.

The legislation was drafted following calls from the Canadian media industry for more stringent regulation of internet companies, to allow news businesses to recover from financial losses incurred as Facebook and Google captured a larger share of the online advertising market. Rodriguez noted that nearly 80% of all advertisement revenue in Canada, amounting to almost 10 billion Canadian dollars ($7.5bn) in 2022, went to Google and Facebook. The government aims for these platforms to contribute to the domestic journalism sector.

The suspension of government ads is estimated to impact Facebook and Instagram’s revenues by about 10 million Canadian dollars ($7.5m) annually. Meta has previously stated that news content does not generate significant economic value for the company and that news organizations benefit from sharing their content on Facebook.

Meta’s spokesperson remarked that the current regulatory process is not capable of addressing the fundamental issues with the legislation and announced plans to cease news availability in Canada in the coming weeks. Meanwhile, Rodriguez expressed a more hopeful perspective on reaching an agreement with Google.

Google, having proposed amendments to the act that were rejected, commented last week that the government’s regulatory process might not address the structural issues with the legislation. The company did not provide any comment on Wednesday.

This dispute between Canada and internet giants may influence other governments’ attempts to regulate internet companies. The resolution in Canada could potentially set a precedent for similar actions in the United States. US Senator Elizabeth Warren voiced support for Canada’s stance against Big Tech’s practices.

In solidarity with the government’s position, Canadian telecoms operator Quebecor and Cogeco, a radio station operator in Quebec, also announced their decision to halt advertising on Facebook and Instagram due to Meta’s opposition to the new law.

Explore the newest supply chain news at The Supply Chain Report. Visit ADAMftd.com for free international trade tools.

#CanadianHeritage #PabloRodriguez #Meta #Facebook #Instagram #Alphabet #OnlineNewsAct #BillC18 #TechGiants #CanadaNews #MediaRegulation #AdvertisingRevenue #CanadaGovernment #PrimeMinisterTrudeau #Quebecor #Cogeco #SocialMediaRegulation #BigTech #NewsCompensation #DigitalMedia #TechPolicy #FairCompensation #MetaNewsBan #NewsPublishers #GoogleNews #RegulatoryReform #CanadaDigitalPolicy