As Donald Trump’s fight with Canada over tariffs turns into a full-blown trade war, content spending by major Hollywood studios in the country is at stake. Under the rules set in Canada, American digital giants (think Netflix, HBO Max, Disney+ and more) must spend a certain amount of money on what is considered local content, such as movies and shows aimed at Canadian and global audiences. Crave and HBO’s Max’s hit gay hockey drama Heating Rivalry, Indigenous comedy North of North on CBC and Netflix, and Quebec’s French-language transgender drama Fem come to mind. American producers have delayed this plan, titled the Online Streaming Act, by appealing the legislation in court, and the Trump administration has included the issue in its much broader trade fight with its northern neighbor. Now, local Canadian producers are urging the government to revive those plans to force American companies to help subsidize domestic film and television production. Canada’s lawmakers, in an effort to be diplomatic, had rescinded that Online Broadcasting Act to get more favorable terms in a potential cross-border trade and tariff deal. It didn’t work. Therefore, some producers are throwing knives to restore plans to obtain subsidies from US companies operating north of the US border. “Last night, the federal government stood up for Canada by refusing to accept an inequitable trade deal. We look forward to working with the government to ensure that whatever happens next, the Online Streaming Act, a key pillar of Canadian cultural and digital sovereignty, is upheld,” said Reynolds Mastin, president and CEO of the Canadian Media Producers Association, which represents independent producers, after Canadian Prime Minister Mark Carney broke off crucial talks on Friday night. “Canadians must remain in control of their own stories, with global platforms generating billions of dollars from our market by following Canadian rules and contributing significantly to a robust production ecosystem,” Mastin added. Carney, at a news conference Saturday, said the trade talks were abandoned in part after U.S. negotiators objected to digital content rules around the French language that can lead to higher operating costs for U.S. companies seeking to bring content to French-speaking Quebec. Carney said the disagreement over French language rules for American companies amounted to an attack on Canada’s culture and identity. “There were efforts to restrict the protection of our language, our culture and indeed our sovereignty,” he told reporters, without giving details. Canada has set a retaliatory tariff program against the United States that will take effect on September 8 after abandoning trade deal negotiations. And after the new US tariffs went into effect, US President Trump threatened to impose additional tariffs on Canadian cars and trucks heading to the US market after he took to his Truth Social platform on Sunday to claim: “Canada wants the benefits of being a state, without being one!!!” That accusation, an echo of Trump’s constant mockery of the 51st state, has caused growing cross-border trade and political tensions between the United States and Canada to cast an even larger shadow over the domestic film and television industry. To improve its chances of striking a potential cross-border trade deal, Ottawa in early June scrapped regulatory plans to triple a local tax on foreign, mostly American, streamers as part of its Online Broadcasting Act legislation now held up in court before possibly becoming law. American negotiators and representatives have argued that forcing American digital giants to fund the production of Canadian media content amounts to discrimination against American companies. Local unions and independent producers have responded by turning to American web giants to dig deeper into their pockets to finance the cost of producing homemade content. Carney and his Liberal Party government opted this summer to rescind U.S. digital giants’ spending obligations under the Online Streaming Act and asked taxpayers to pay an additional $600 million for local media content to prevent Trump from causing a perfect storm by involving audiovisual content in North American free trade talks. Since content spending requirements have clearly been included in Canada’s trade negotiations, other governments that have also considered imposing regulations could be watching closely how this plays out.
