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Public Policy

Our Senate testimony on Bill C-18

Editor's Note: Delivered to the Senate Standing Committee on Transport & Communications on Wednesday, May 3rd, 2023

Mr. Chair, honourable Senators, thank you for the opportunity to appear and share our perspective on Bill C-18.

We have often heard our position on this legislation mischaracterized as not wanting to be regulated or not wanting to support Canada’s news ecosystem. This is untrue.

Through both our services and our direct funding of news organizations, Google is one of the world’s biggest financial supporters of journalism.

Last year alone, we linked to Canadian news publishers more than 3.6 billion times - at no charge - helping them make money with ads and new subscriptions. We also pay news publishers to licence curated and paywalled content through Google News Showcase, which currently supports more than 150 publications across Canada. Through the Google News Initiative, we provide tools, training, and funding to support the shared goal of enabling a healthy, independent, and diverse news ecosystem.

We are willing and ready to do more. We support a thoughtful approach to regulation that protects the foundations of the open web and recognizes the value we already provide to publishers.

Unfortunately, C-18 will not encourage the continuation or expansion of publisher licensing agreements, as it is intended to do. And it may jeopardize current products, services and investments that benefit the news ecosystem and all Canadians.

For over a year now, we have been sharing our concerns and proposing thoughtful solutions and alternative models that would be more effective at achieving the underlying policy goals.

However, rather than considering a fund model or addressing concerns raised by us and others, recent amendments glossed over serious issues, exacerbated others, and produced a range of new inconsistencies.

The debate on this legislation has also created dramatically unrealistic expectations among news publishers and politicians, treating Bill C-18 as an unlimited subsidy for Canadian media. And the publisher class has grown so broad that it won't have an impact where it matters most.

Core among the issues with C-18 are the provisions that override well established copyright allowances and put a price on links. By making Canada the first country in the world to put a price on free links to webpages, this Bill ignores the existing $250M value of free traffic to publishers and sets a dangerous precedent that is contrary to the long-term interests of the Canadian news ecosystem.

Leaving existing copyright balances intact, as was done with the European Union Copyright Directive (EUCD), would establish a reasonable baseline that recognizes the value of free traffic and enables negotiation of value-added content and services.

Regrettably, C-18 could see existing support to Canadian news publishers slow down or stop while Google and others seek the clarity to ensure a reasonable outcome.

Creating clear exemption criteria would have the immediate benefit of encouraging Google and publishers to sit down, reach agreements, and flow money to journalism quickly.

Replacing final-offer arbitration with standard commercial arbitration, which is relied on for the most complex business disputes, would be the fair and just way to settle any disputes.

Furthermore, clarifying eligibility criteria would ensure the Bill effectively and equitably supports quality journalism for local communities, including ensuring that eligible news businesses actually produce journalism and directly fund the creation of journalism.

The reality of Bill C-18 is that the extreme level of business uncertainty and uncapped financial liability that Google is being asked to accept - merely for providing free links to the news sources Canadians are searching for, and which news publishers benefit from - is unreasonable. And threatens to create a situation where everybody loses.

If we must pay publishers simply for linking to their sites, making us lose money with every click, it would be reasonable for us, or any business, to reconsider why we would continue to do so.

We remain laser focused on working constructively with Senators, with the government, and with the news industry, to fix this legislation and make it work the way it’s intended.

At minimum, C-18 should include a clear and attainable path to exemption that incentivizes businesses like Google to continue to support the Canadian news ecosystem.

We look forward to your questions.

Our recommendations for Bill C-18

Bill C-18 s. 2(2), 24 | “Making Available”

ISSUE: Putting a price on links breaks Search and the internet for everyone CONCERN: Overrides copyright law and incentivizes clickbait content FIX: Limit to “Displaying News Content” + clarify that copyright norms still apply

Requiring payment for “making news content available” puts a price on links, which breaks the foundation of the open web. It creates a cost for simply providing Canadians with links to the information they’re searching for, disregards the existing value of traffic generated for news publishers, and incentivizes volume of content over quality content (ie. clickbait over journalism). It’s also inconsistent with copyright law and norms.

We recommend revising the bill to preserve existing copyright exceptions and ensure payment obligations are triggered by “displaying” news content in ways not included in those exceptions. This eliminates payment for links and leaves reasonable copyright balances intact.

Bill C-18 s. 11, 19, 38, 39 | “Exemption & Dispute Resolution”

ISSUE: Exemption is unclear and near impossible to obtain + processes outlined for dispute resolution likely violate basic procedural fairness CONCERN: Disincentivizes good-faith negotiations and slows the flow of money to publishers FIX: Revise to standard commercial arbitration, and establish clear/workable exemption criteria

Unreasonable “Dispute Resolution” and “Exemption” criteria leave Digital News Intermediaries with an extreme level of business uncertainty and uncapped financial liability, making it difficult to continue to work in good faith to reach agreements with publishers, and potentially impacting how news content is made available to Canadians.

To ensure fair and balanced outcomes for all, dispute resolutions should follow standard commercial arbitration rules with expedited timelines, and directions to the arbitration panel should be removed. The exemption criteria must be clear, numerical, and apply to all obligations. In keeping with the spirit of C-18, it should only require agreements with outlets that produce news and are online.

Bill C-18 s. 27 | “Eligible News Business”

ISSUE: Extremely broad and inconsistent ENB eligibility criteria CONCERN: No consistent requirement that outlet produces news or adheres to journalistic standards, and no guarantee funding flows to journalism FIX: Streamline eligibility criteria and ensure funding be allocated to journalism

The Bill contains varying standards of eligibility criteria, applied differently across publications in order for them to qualify as an “Eligible News Business”. This leads to complex and inconsistent standards. Additionally, there’s no requirement that funding be allocated to journalism.

To ensure the Bill effectively and equitably supports quality journalism, eligibility criteria should be streamlined so all outlets are required to produce news content and adhere to a recognized code of ethics in order to qualify. And, it is essential that any funds received be allocated to journalism.

Bill C-18 s. 51 | “Undue Preference”

ISSUE: Prevents elevating trusted sources CONCERN: Creates liability for elevating authoritative information and empowers bad actors FIX: Strike or limit Undue Preference

“Undue Preference” is a concept built for traditional broadcast models, not today’s open web. It creates the risk of liability for elevating authoritative information in Search results, preventing Google and other platforms from prioritizing trustworthy sources of information over bad actors. This makes Search less useful and less safe for Canadians.

The “Undue Preference” provision should be removed, or explicitly limited to only prohibit “Unjust Discrimination,” and not apply to standard ranking or recommendation activities.