Netflix, Disney and Amazon Take CRTC to Court Over New Streaming Rules

Foreign streaming companies are zeroing in on a legal fight over a new CRTC rule that would make some of their financial information public.

A group of major streamers, including Netflix and Amazon, filed a challenge in the Federal Court of Appeal in December, targeting disclosure requirements tied to the regulator’s overhaul of Canadian content rules.

The challenge focuses on a CRTC decision that would require large online streaming services to submit detailed financial data, including their Canadian broadcasting revenues and spending on Canadian programming, and allow the regulator to publish that information, reports the Canadian Press.

In court filings submitted by Motion Picture Association—Canada, the companies say the CRTC is playing hardball by forcing the release of financial information without letting them first argue it should stay private.

The association represents Netflix, Walt Disney Studios, Warner Bros. Entertainment, Universal Pictures, Paramount Pictures, Sony Pictures Entertainment, and Amazon MGM Studios.

“The CRTC unreasonably applied s. 25.3 of the Broadcasting Act in its determination to publish future sensitive financial information without giving the Applicants an opportunity to designate it as confidential and make representations at the time the information is provided,” the companies wrote in their court submission. They also argue that making the information public could seriously hurt their businesses, especially in a highly competitive global streaming market.

The CRTC pushed back on that view in its November decision, saying it believes transparency is in the public interest and outweighs any potential harm. At the time, CRTC vice-president of broadcasting Scott Shortliffe said the requirement is not a big deal and noted that Canadian broadcasters have had to do the same reporting for years.

The legal fight is part of broader pushback against the CRTC’s efforts to implement the Online Streaming Act, which updated broadcasting rules to include online platforms. Streamers are already challenging a separate CRTC decision that would require them to contribute 5% of their Canadian revenues to funds supporting Canadian content, a case that remains before the courts.

Back in May, streamers already pushed back against CanCon rules at a CRTC hearing. It’s possible any extra fees forced upon streaming services will likely result in price hikes for consumers.