Online News Act Application and Exemption Regulations

Online News Act Application and Exemption Regulations Her Excellency the Governor General in Council, on the recommendation of the Minister of Canadian Heritage, makes the annexed Online News Act Application and Exemption Regulations under section 84 of the Online News Acta. S.C. 2023, c. 23 Definition of Act In these Regulations, Act means the Online News Act. Imbalance — factors For the purposes of section 6 of the Act, there is a significant bargaining power imbalance between an operator and news businesses only if, with respect to the factor set out in paragraph 6(a) of the Act, the operator’s total revenue from all sources in the previous calendar year is greater than $1 billion; and with respect to the factors set out in paragraphs 6(b) and (c) of the Act, the digital news intermediary in question is one of the following online communications platforms: a search engine that, during the previous calendar year, had an average of at least 20 million unique visitors in Canada per month, a social media service that, during the previous calendar year, had an average of at least 20 million active users in Canada per month. Notification of Commission An operator that is required to notify the Commission under subsection 7(1) of the Act must do so within 180 days after the day on which the Act begins to apply in respect of the digital news intermediary. Conditions The following are, for the purposes of paragraph 11(1)(b) of the Act, conditions for the making of an exemption order: the operator carried out, before requesting the exemption, an open call process in relation to the digital news intermediary, in which the operator published for a period of at least 60 days — and requested that the Commission make available on its website for the same period — a notice indicating that all news businesses that could be designated as eligible under section 27 of the Act and that wished to obtain compensation from the operator should respond to the notice, either individually or as a group of news businesses, to convey that wish, the operator provided news businesses and groups of news businesses with a period of at least 60 days to respond to the notice, and as soon as possible after the end of the period referred to in subparagraph (ii), the operator published — and requested that the Commission make available on its website — a list of the news businesses that responded to the notice, either individually or as a group of news businesses, that identifies, if applicable, the group of news businesses through which each responded; the operator has provided the Commission with any information relevant to the making of the exemption order, including a list of the news businesses that responded to the notice, whether individually or as part of a group of news businesses, within the period set out in that notice and from which the operator has received an attestation referred to in paragraph 5(a), as well as a list of the news outlets operated by each of those news businesses in respect of which the operator has received an attestation referred to in paragraph 5(b); and the agreements referred to in paragraph 11(1)(a) of the Act set out the dollar value of any portion of the compensation that they provide for that consists of non-monetary contributions. Request for information For greater certainty, for the purpose of complying with paragraph (1)(b), the operator may request relevant information from news businesses and groups of news businesses, including information in respect of the news outlets operated by those news businesses. Interpretation of criteria — attestations When interpreting subparagraphs 11(1)(a)(i) to (viii) of the Act, the Commission must consider the impact of the agreements on only the following news businesses and news outlets: news businesses that have provided an attestation to the operator indicating that they could be designated as eligible under section 27 of the Act, and they operate a news outlet that is operated exclusively for the purpose of producing news content referred to in subsection 31(2) of the Act or that is a news outlet referred to in subsection 31(2.1) of the Act, whose news content is made available by the digital news intermediary in question; and news outlets that are operated by a news business that has provided an attestation to the operator indicating that the news business could be designated as eligible under section 27 of the Act, the news outlets are operated exclusively for the purpose of producing news content referred to in subsection 31(2) of the Act or are news outlets referred to in subsection 31(2.1) of the Act, and the news outlets’ news content is made available by the digital news intermediary in question. Interpretation — fair compensation For the purposes of subparagraph 11(1)(a)(i) of the Act, the Commission must interpret the agreements as providing for fair compensation if they provide for comparable compensation to news businesses of a similar size, with a similar business model and similar capabilities that provide a similar type of news content to comparable markets and communities. Precision Agreements need not provide any consideration for merely facilitating access to news content or for otherwise making news content available in a manner that would fall under a limitation or exception in the Copyright Act for the Commission to be of the opinion that they provide for fair compensation. Interpretation — appropriate portion For the purposes of subparagraph 11(1)(a)(ii) of the Act, the Commission must interpret the agreements as providing that an appropriate portion of the compensation will be used to support the production of local, regional and national news content if the agreements include a commitment by the news businesses or groups of news businesses that are party to them to use a majority of the monetary compensation provided under the agreements to support the production of local, regional and national news content. Interpretation — freedom and independence For the purposes of subparagraph 11(1)(a)(iii) of the Act, the Commission must interpret the agreements as not allowing corporate influence to undermine the freedom of expression and journalistic independence enjoyed by news outlets if the agreements include a commitment that the operator will not, directly or through its digital news intermediary, take any action that undermines freedom of expression or journalistic independence, including taking retaliatory action in response to an editorial decision of a news business or news outlet; restricting actions a news business or news outlet may take to protect journalistic independence; and intervening in a news business’s or a news outlet’s editorial process. Interpretation — sustainability When interpreting subparagraph 11(1)(a)(iv) of the Act, the Commission must consider the sufficiency of the total monetary compensation provided for in the agreements in contributing to the sustainability of the Canadian news marketplace, including by having regard to the digital news intermediary’s share of Canadian Internet advertising revenues in the calendar year before the calendar year in which the request for exemption is made. Exception — largest search engine Despite subsection (1), in the case of the digital news intermediary that is the search engine with the greatest share of Canadian Internet advertising revenues among all search engines in respect of which the Act applies, the Commission must interpret the agreements as contributing to the sustainability of the Canadian news marketplace if and only if, for each year covered by the potential exemption order, the agreements provide for monetary compensation in accordance with the formula is the highest Consumer Price Index for any calendar year beginning with 2023 and ending with the calendar year before the year for which the compensation is paid; and is the Consumer Price Index for 2023. Consumer Price Index For the purpose of subsection (2), a reference to the Consumer Price Index for a calendar year is a reference to the all-items Consumer Price Index for Canada, annual average, not seasonally adjusted, for that year, as published by Statistics Canada under the authority of the Statistics Act. Non-monetary compensation For greater certainty, the fact that the Commission, in interpreting subparagraph 11(1)(a)(iv) of the Act, is to consider only the contribution of monetary compensation to the sustainability of the Canadian news marketplace does not preclude an operator from providing non-monetary compensation to a news business or group of news businesses, nor does it preclude the Commission from having regard to that non-monetary compensation when determining whether other criteria under paragraph 11(1)(a) of the Act are satisfied. Interpretation — agreement with group In the case of an agreement entered into by an operator with a group of news businesses, the Commission must interpret the criteria set out in subparagraphs 11(1)(a)(i) and (v) to (viii) of the Act as being satisfied if the agreement provides for the equitable distribution among the news businesses that are members of the group, following the deduction of reasonable administrative expenses, of monetary compensation in an amount that would, without regard to any other agreement and in accordance with section 9, satisfy the criterion set out in subparagraph 11(1)(a)(iv) of the Act; and the agreement permits any news business that responded to the notice referred to in paragraph 4(1)(a) to become a member of the group at any time and consequently receive, from the date on which it becomes a member of the group, compensation under the agreement. Equitable distribution For the purpose of paragraph (1)(a), the equitable distribution of monetary compensation is to be determined, subject to subsection (3), having regard to the number of full-time equivalent employees who, in the previous calendar year, were employed by each news business for the purpose of producing, for news outlets operated by that business, original news content that is intended to be made available online. Exception — broadcasters No more than 30% of the monetary compensation may be allocated to news businesses — other than the Canadian Broadcasting Corporation — that carry on a programming undertaking as defined in subsection 2(1) of the Broadcasting Act, in relation to news outlets that are or are part of a broadcasting undertaking as defined in that subsection, and no more than 7% of the monetary compensation may be allocated to the Canadian Broadcasting Corporation. The agreement need not provide any consideration for merely facilitating access to news content or for otherwise making news content available in a manner that would fall under a limitation or exception in the Copyright Act. Definitions The following definitions apply in this section. news business means a news business that could be designated as eligible under section 27 of the Act; and operates a news outlet as defined in this subsection. (entreprise de nouvelles) news outlet means a news outlet that is operated exclusively for the purpose of producing news content referred to in subsection 31(2) of the Act or that is a news outlet referred to in subsection 31(2.1) of the Act, whose news content is made available by the digital news intermediary in question. (média d’information) December 19, 2023 These Regulations come into force on December 19, 2023, but if they are registered after that day, they come into force on the day on which they are registered.