Canadian Media Producers Association (CMPA) president and CEO Reynolds Mastin has had “many conversations over many months” with Heritage Minister Pablo Rodriguez, his political staff and officials in his department about the urgent need to update Canada’s Broadcasting Act, which was introduced more than 30 years ago – long before “Netflix” entered the lexicon.

Those conversations paid off when Bill C-11, also known as the Online Streaming Act, received royal assent in April after some back-and-forth amendments between the House of Commons and the Senate.

Mastin (pictured right) says he believes the amendments to the Broadcasting Act – which include recognizing the online transmission or retransmission of programs as “a distinct class of broadcasting undertakings” – will provide the CMPA’s 600 film-and-television producer members with more of a level playing field with such foreign streaming giants as Netflix, Disney+ and Prime Video.

“The bill provides a legal framework that will facilitate investment in Canadian content’s production, which is a very positive development,” says Mastin, a lawyer who previously served as the CMPA’s chief negotiator and chief legal officer. “What remains to be seen is the level of that investment and what the terms of that investment will look like.”

Bill C-11, as outlined, will require digital streaming platforms to “contribute in an equitable manner to strongly support the creation, production and presentation of Canadian programming,” akin to how domestic broadcasters are currently regulated.

Mastin expects that guidance on how that money is to be disbursed will be addressed in the policy direction Canadian Heritage will send to the Canadian Radio-television and Telecommunications Commission (CRTC), which will then implement a regulatory framework following public consultations. Those consultations will cover topics including what should qualify as Canadian content.

Brad Danks, CEO of Vancouver-headquartered OUTtv Media Global, expects that Cancon will become the “battleground” that emerges from the Online Streaming Act. “Some streamers have already said they’ll make Canadian shows here, but they want to own them,” says Danks (pictured left). “However, the core value of Canadian content has been the ownership that has built Canadian companies.”

The CMPA is preparing a proposal to the CRTC on what it sees as the appropriate distribution mechanisms for the new investment from foreign streamers.

“The two key criteria we’re using are: which mechanisms are going to ensure the greatest level of investment and the most impactful terms of the investment so Canadian production companies are able to work with Canadian talent, broadcasters and foreign streaming services to create great IP [intellectual property] and that production companies are able to meaningfully control and monetize that IP,” Mastin explains.

Canadian producers, he says, “will do everything they can to leverage that investment to create the most compelling Canadian content out there. “The Broadcasting Act is there in part to serve policy objectives that the market all by itself doesn’t achieve,” says Mastin.

“That’s why the focus in the policy direction has to be on requirements to fill the gaps that the market cannot or does not fill by itself, rather than incentives, such as tax credits,” he says, adding that CBC’s Heartland (pictured right; Dynamo Films, SEVEN24 Films) is “a great example of a series that benefited from Cancon rules and has gone on to huge global success as the 13th-most-streamed show in the U.S. last year, according to Nielsen, beating out The Simpsons and Friends with over 18 billion minutes streamed.”

The CMPA applauded the government for including one provision – subsection 10.1.1(a) – in C-11 “that will go a long way to ensuring that Canadian independent producers have meaningful ownership and control over their own IP when they partner with Canadian broadcasters or foreign streaming services,” explains Mastin.

He says the CMPA is also working with Canadian Heritage officials to ensure that the government’s instructions to the CRTC “mitigate any potential unintended consequences from the two-tier framework in the bill.

Subsections 3(1) (f ) and (f.1) of Bill C-11 will hold foreign streamers to a “lower standard” than Canadian broadcasters and “result in foreign streamers using fewer Canadian creators in the production of Canadian programming,” according to the CMPA.

The two subsections would require “each Canadian broadcasting undertaking” to “employ and make maximum use, and in no case less than predominant use, of Canadian creative and other human resources in the creation, production and presentation of programming,” while “each foreign online undertaking” would only be asked to “make the greatest practicable use.”

Neal McDougall (pictured left), assistant executive director at the Toronto-based Writers Guild of Canada (WGC), says there remains concern that “those subsections could be misinterpreted to allow foreign streamers to make so-called Canadian content without using a meaningful level of Canadian creators, including screenwriters.”

“The streamers can be expected to look for as much flexibility in the definition of what Canadian content is as possible,” he says. “If that were to be granted, it would be a complete gutting of the purpose of C-11.”

However, John M. Lewis, director of Canadian affairs at the International Alliance of Theatrical Stage Employees (IATSE), says C-11 must contain flexibility in order to recognize the unique business models and content strategies of foreign and domestic players.

“Section 3(1) (f.1) deals with how foreign and domestic entities are different and this must be considered when determining how each is treated,” he says.

It’s also “simply not realistic” to require foreign entities shooting in Canada to meet the same bar as domestic companies for the use of Canadian talent, says Lewis, whose union represents members employed by both domestic and global entities in Canada.

“Whenever foreign entities can use Canadian talent, they do. From a purely financial standpoint, it makes far more sense to use local talent whenever possible,” says Lewis, who also posits that “global studios and streamers are expanding the availability of Canadian-owned content, generating new audiences, revenues and discoverability for Canadian creators and producers of that content.”

Lewis also points to the high number of jobs that foreign service work provides in Canada’s film and TV industry (in the CMPA’s Profile 2022 report, it accounted for more than 141,000 jobs out of a total of nearly 241,000). “Making changes to the status quo will endanger the industry that we’ve worked very hard to build,” he says.

WGC president and screenwriter Alex Levine (pictured right) says that notwithstanding the “problematic language” under section 3(1) in C-11, he is optimistic that the federal government will, in its policy direction to the CRTC, “continue to recognize the primary place of Canadian creators in the making of Canadian content” to facilitate “a robust Canadian production sector.”

“That can’t happen in the new playing field with the streamers dominating eyeballs unless this bill does what it’s intended to do, which is to continue to place Canadian creatives at the centre of Canadian content,” says Levine, a writer and co-executive producer of the Emmy Award-winning, Toronto-shot sci-fi series Orphan Black, produced by Temple Street Productions (now folded into Boat Rocker Studios).

“[Orphan Black] was made by a Canadian production company that benefited from the success of that show and is continuing to invest in the Canadian production sector with new Canadian programming. The money isn’t just flowing out of the country,” he says, noting that Boat Rocker’s latest TV series, Global’s upcoming Robyn Hood, includes Orphan Black‘s Chris Roberts as lead writer and showrunner.

“That’s the way this business is supposed to work. You’re supposed to grow your talent, and keep the money and the opportunities and the jobs in the country.”

While foreign streamers, such as Netflix, Amazon’s Prime Video, Paramount+ and Disney+, have set up shop in Canada “because they recognize there’s opportunity here,” says Levine. “I also think they know regulation is coming and they’re putting their best foot forward to say, ‘Hey, we’ll do business here.'”

“What they really are saying is, ‘We don’t want to be regulated or forced into any decision.’ However, that is not a sustainable plan. We can’t rely on the goodwill of these behemoths from the south to come up here and keep our industry afloat. We have to have regulations that protect our production sector from the whims of the executives in Hollywood,” he says, noting that Canadian screenwriters only work on Canadian productions, unlike the other guilds that continue to work on service productions, the scripts of which “are all written in Hollywood.”

“For Canadian screenwriters, this is an existential issue – and the government has to do something to ensure that Canadians can grow up to be screenwriters and the future Sara Polleys of the world can receive Academy Awards,” says Levine of Polley’s Best Adapted Screenplay Oscar win this year for U.S. feature Women Talking (pictured left), which she also directed.

The two-tiered “existential crisis” is one some creators have felt for as long as the Broadcasting Act has been enacted.

“Indigenous creators have been living in a two-tiered system since colonization,” Indigenous Screen Office (ISO) CEO Kerry Swanson said at the CMPA’s Prime Time conference in February. “The current Act deems special status to Indigenous peoples ‘as resources become available,’ which sounds very much like ‘as best as practicable,’ doesn’t it?”

Some of those impacts are expected to be amended, as Bill C-11 includes language that supports the creation of programming by and for Indigenous, Black and other racialized communities.

“The new bill has the potential to transform the Canadian screen industry by requiring adequate support for Indigenous content creation, and for us at the ISO that means Indigenous-owned content,” said Swanson (pictured right).

McDougall says the WGC will appear before the CRTC when it holds public hearings on C-11.

“We hope that the CRTC will create clear, black-and-white regulations and rules requiring a certain amount of investment in Canadian content, which is defined in such a way as to include, to a maximum degree, Canadian screenwriters and other creators,” he says. “Defining Canadian content is not an exercise in the abstract. It has a function, which is to determine eligibility for tax credits, funding and regulatory obligations, all of which have public-policy objectives to support Canadian creators, Canadian jobs and Canadian culture.”

Danks says it will be up to the CRTC to determine whether it’s time to update the definition of Canadian content. The Canada Media Fund is exploring that very subject matter with an industry-facing survey on how the current definition of Cancon should evolve with the passage of C-11.

“You’ve got two camps. There are Canadian producers and broadcasters who believe that Cancon mostly works since it’s been responsible for building the industry in many ways, especially with the implementation of the tax-credit system,” says Danks, referring to the Canadian Film or Video Production Tax Credit introduced in 1995.

“Then there are people who believe that any show with a Canadian theme should qualify as Canadian content. Does that mean we should give a 30% tax advantage to foreign entities if they’re doing that? We already have a production-services tax credit for those programs,” says Danks.

He says he would like to see Cancon defined as “a program made with a significant amount of Canadian elements controlled and owned by Canadians,” the latter of which encompasses both copyright and distribution rights.

The Canadian Audio-Visual Certification Office has used the 6/10 points system based on the key creative functions that are performed by Canadians to determine the tax credit. Under that system, at least one of either the director or screenwriter positions (two points each) and at least one of the two lead performers (one point each) must be Canadian.

Of the six, out of 26, Senate amendments the federal government rejected was one that would have added flexibility to the definition of Cancon in CRTC regulation, reducing the prominence of such factors as to whether the content is owned by a Canadian independent producer or has key Canadian creatives involved.

“The principle that Canadian programs are first and foremost content made by Canadians is, and has been, at the centre of the definition of Canadian programs for decades, and this amendment would remove the ability for the CRTC to ensure that that remains the case,” the government said in response to amendments made by the Standing Senate Committee on Transport and Communications, which passed the upper house in February.

Lewis (pictured left) says the current definition of Cancon provides “no possible path to having these streamers show Canadian programming, because even if everything about a show is Canadian – the performers, writers, the directors, crew, storyline, shooting location – the program will still not qualify as Canadian if the IP is held by a non-Canadian entity.”

There are also gaps in C-11 regarding distribution, says Danks. The bill will not enable the CRTC to set terms of carriage for an “online undertaking,” which will have to be negotiated in “good faith” with the likes of Prime Video and Apple TV+, both of which carry OUTtv programming.

However, the Online Streaming Act will require those aggregators to include Canadian services, the network head adds.

“This is a great start. Any Canadian service that’s going to survive needs to be on the platforms,” says Danks, who notes that it has allowed OUTtv to use its distribution revenue to create original programming.

“This bill, if the proper guidance is provided through the policy direction and then implemented by the CRTC, has the potential to serve the industry as well as the
Broadcasting Act did when it was brought in back in 1991,” says Mastin.

“I am optimistic that the bill provides the tools that are necessary to ensure a great, bright future for Canadian content and enable the industry to best serve Canadian and global audiences.”

This story originally appeared in Playback‘s Spring 2023 issue

Women Talking photo credit: Michael Gibson – 2022 Orion Releasing LLC. All Rights Reserved.