The Government of Canada will stop buying ads on Facebook and Instagram, Heritage Minister Pablo Rodriguez stated on Wednesday, as a fight with tech titans over a new media compensation law Bill C-18 heated up.
The Online News Act, passed by parliament last month, forces digital behemoths such as Google and Meta to enter into commercial agreements to reimburse Canadian news sources when readers view stories via their products, or face binding arbitration.
Meta, the parent company of Facebook and Instagram, declared shortly after the bill’s passage that it will take steps to ban Canadian news for users on its services in the nation.
On Wednesday, Rodriguez called the acts “unreasonable” and “irresponsible.”
“This is why the government of Canada is suspending its advertising on Facebook and Instagram today,” he added, estimating the cost to Facebook and Instagram at roughly Can$10 million (US$7.5 million) each year.
Google has also stated that it will take similar steps to defy the legislation.
The two dominant online advertising corporations have been accused of syphoning money away from established news organisations while utilising their material for free.
“American billionaires who want to undermine our democracy will not intimidate Canadians,” Prime Minister Justin Trudeau said, adding that his government would not back down from its decision.
Since 2008, more than 450 Canadian media outlets have closed their doors, according to the Department of Canadian Heritage.
According to an October 2022 study by Canada’s parliamentary budget inspector, the Online News Act will result in Canadian newspapers receiving approximately Can$330 million per year from digital platforms.
Canada’s measure builds on Australia’s New Media Bargaining Code, a world first that required Google and Meta to pay for journalistic material on their platforms. California lawmakers are attempting to pass a similar measure.
At the end of 2021, AFP inked a five-year “neighbouring rights” arrangement with Google under which the internet giant will pay for content from the news agency. It also entered into two business agreements with the platform.
Facebook’s Zuckerberg and Sandberg ignore Canadian subpoena
Despite getting summonses from the Canadian government, Facebook’s Mark Zuckerberg and Sheryl Sandberg did not attend a hearing in Ottawa in 2019.
Instead, Facebook brought two representatives from its public policy team to the hearing, which was part of an international committee meeting to examine Silicon Valley’s impact on privacy and democracy.
Multiple politicians noted that Zuckerberg’s absence contrasted what he said in an op-ed in March, when he said he was “looking forward to discussing them [online issues] with lawmakers around the world.”
The committee’s chair, Bob Zimmer MP, chastised Facebook officials for failing to appear.
“Shame on Mark Zuckerberg and Sheryl Sandberg for not showing up today,” he stated at the meeting’s conclusion.
The Canadian Parliament issued formal inquiries to both Zuckerberg and Sandberg earlier this month. Both Zuckerberg and Sandberg have testified in front of the US Congress on the matter.
Zimmer stated Monday night that Facebook had not informed the committee of the attendance of its two most senior officials. He claimed that committee members learnt of Zuckerberg and Sandberg’s refusal to testify from CNN.
According to a Facebook representative, the firm informed the committee that Kevin Chan, its head of public policy for Facebook Canada, and Neil Potts, its director of public policy, would attend the meeting. The corporation, according to the spokeswoman, has been in constant contact with the committee.
Google and Twitter also sent representatives to address the committee, although the committee does not appear to have summoned the top executives of those businesses.
The gathering, the second of its kind, was scheduled to draw lawmakers from at least ten countries, including the United Kingdom and Australia. The committee’s initial meeting last year in London resulted in the revelation of confidential internal Facebook papers.
“We represent about 450 million people collectively, which is a larger population group than the United States,” Zimmer, whose committee is organising the worldwide summit, told CNN.
Zimmer summoned both Facebook executives earlier this month. He stated that the corporation has submitted replacement names of people who would go in their stead, but that he would like to hear directly from the social network’s top two executives.
He believes their presence is significant because “knowing the structure of Facebook and how it is micro-managed right from the top, any change on the platform is done through Mr. Zuckerberg or Ms. Sandberg.”
“It’s not that difficult to hop on a plane and make time to listen to legislators and answer their questions,” he told CNN.
Zimmer stated that the decision to hold them in contempt would be voted on by the entire Parliament.
“Nobody is going to come with handcuffs and arrest them,” he added, “but being held in contempt by an entire country would not serve any platform well.”
“Ultimately, this is a decision for Parliament — we’re not in a position to speculate,” a Facebook (FB) spokeswoman said earlier Monday. We share the Committee’s desire to protect people and hold firms like ours accountable. Right now, we’re focused on having a meaningful conversation with the committee and looking forward to answering their questions.”
“We look forward to answering their questions, and we remain committed to working with world leaders, governments, and industry experts to address these complex issues,” said a spokeswoman.
