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CHARTER STATEMENT

Bill C-18: An Act respecting online communications platforms that make news content
available to persons in Canada

Explanatory Note
Section 4.2 of the Department of Justice Act requires the Minister of Justice to prepare a Charter
Statement for every government bill to help inform public and Parliamentary debate on
government bills. One of the Minister of Justice’s most important responsibilities is to examine
legislation for inconsistency with the Canadian Charter of Rights and Freedoms [“the Charter”].
By tabling a Charter Statement, the Minister is sharing some of the key considerations that
informed the review of a bill for inconsistency with the Charter. A Statement identifies Charter
rights and freedoms that may potentially be engaged by a bill and provides a brief explanation of
the nature of any engagement, in light of the measures being proposed.
A Charter Statement also identifies potential justifications for any limits a bill may impose on
Charter rights and freedoms. Section 1 of the Charter provides that rights and freedoms may be
subject to reasonable limits if those limits are prescribed by law and demonstrably justified in a
free and democratic society. This means that Parliament may enact laws that limit Charter rights
and freedoms. The Charter will be violated only where a limit is not demonstrably justifiable in a
free and democratic society.
A Charter Statement is intended to provide legal information to the public and Parliament on a
bill’s potential effects on rights and freedoms that are neither trivial nor too speculative. It is not
intended to be a comprehensive overview of all conceivable Charter considerations. Additional
considerations relevant to the constitutionality of a bill may also arise in the course of
Parliamentary study and amendment of a bill. A Statement is not a legal opinion on the
constitutionality of a bill.

Charter Considerations
The Minister of Justice has examined Bill C-18, An Act respecting online communications
platforms that make news content available to persons in Canada (Online News Act), for any
inconsistency with the Charter pursuant to his obligation under section 4.1 of the Department of
Justice Act. This review involved consideration of the objectives and features of the Bill.
What follows is a non-exhaustive discussion of the ways in which Bill C-18 potentially engages
the rights and freedoms guaranteed by the Charter. It is presented to assist in informing the
public and Parliamentary debate on the Bill. It does not include an exhaustive description of the
entire bill, but rather focuses on those elements relevant for the purposes of a Charter statement.

Overview
Many Canadians access news content through digital intermediaries. Bill C-18 would enact the
Online News Act (the Act), which proposes a regime to regulate digital platforms that act as
intermediaries in Canada’s news media ecosystem in order to enhance fairness in the Canadian

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digital news market. The Bill introduces a new bargaining framework intended to support news
businesses to secure fair compensation when their news content is made available by dominant
digital news intermediaries and generates economic gain. It seeks to support balanced
negotiations between the businesses that operate dominant digital news intermediaries and the
businesses responsible for the news outlets that produce this news content. If one party initiates
it, a final offer arbitration process would be used as a last resort to address scenarios in which
negotiated agreements are not reached. The Canadian Radio-television and Telecommunications
Commission (the Commission) would support and oversee the administration of the regime.
Application of the Online News Act
The Act would regulate digital news intermediaries that make news content produced by news
outlets available to persons in Canada. Search engines and social media services fall within the
definition of digital news intermediary. Messaging services that primarily allow persons to
communicate with each other privately would be excluded from the scope of the Act. The Act
will only apply to digital news intermediaries if there is a significant bargaining power imbalance
between the operators of a digital news intermediary and the news outlets producing the news
content a digital news intermediary makes available. This will be determined according to
statutory criteria, such as the size of the digital news intermediary and whether it occupies a
prominent market position, and any regulations made by the Governor in Council. A digital news
intermediary may also be exempted from the Act if its operator has entered into agreements with
news businesses that satisfy certain conditions, such as providing fair compensation to news
businesses and contributing to the sustainability of Canada’s news marketplace.
The Act will include criteria to determine which news businesses are eligible to participate in the
bargaining process. To be eligible, a news business must be a qualified Canadian journalism
organization or meet other statutory criteria that include operating in Canada and regularly
employing two or more journalists in Canada.
A new bargaining regime to govern the making available of news content
The operators of dominant digital news intermediaries to which the Act applies would be subject
to a new duty to bargain with eligible news businesses, which may bargain individually or as a
group. This duty to bargain would arise when an eligible news business initiates bargaining with
a digital news intermediary organization subject to the Act. The bargaining process could involve
up to three sequential steps: bargaining sessions; mediation sessions; and final offer arbitration.

Final offer arbitration

When digital news intermediaries and news businesses do not reach agreements about making
news content available through bargaining or mediation sessions, outstanding monetary disputes
may proceed to a final offer arbitration process if at least one of the parties wishes to initiate
arbitration. Under this process, an independent panel of arbitrators would select a final offer
made by one of the parties. Arbitrators would be required to consider the value added to the news
content in question by both parties and the benefits that each party receives from the news
content being made available by the digital news intermediary. The parties could apply to a court

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to enforce the terms of an arbitral decision or negotiated agreement and recover any outstanding
payments owing.

Freedom of the expression (section 2(b) of the Charter)

Section 2(b) of the Charter provides that everyone has freedom of thought, belief, opinion and
expression, and includes freedom of the press and other media of communication. Section 2(b)
has been broadly interpreted as encompassing any activity or communication, aside from
violence or threats of violence, which conveys or attempts to convey meaning. Freedom of
expression protects speakers as well as listeners. It may include all phases of a communication,
from the maker or originator through supplier or distributor to receiver, whether listener or
viewer.
A new and enforceable bargaining framework applicable to the digital distribution of news
content has the potential to engage the right to freedom of expression in section 2(b) of the
Charter.
The following considerations support the consistency of Bill C-18 with section 2(b).
Bill C-18 aims to enhance fairness in the economic relationship between news businesses and
online platforms by enhancing the bargaining position of news businesses relative to that of large
and dominant digital news intermediaries. The Act would not apply to digital news
intermediaries unless there is a significant bargaining power imbalance. The goal is to support
news businesses to negotiate and receive fair compensation when third parties with a dominant
market position monetize their news content in a market environment that has been
disadvantageous to news businesses. In this way, the measures seek to support the continued
production and widespread availability of news content. This advances the fundamental values
underpinning expressive freedoms in Canada, which include promoting the search for truth
through the open exchange of ideas; participation in social and political decision-making; and the
opportunity for individual self-fulfillment through expression. Consistent with these values, the
regime will be accessible to a wide array of news businesses, including very small news
businesses and those negotiating in groups. The Bill incorporates a broad definition of news
content capable of accommodating significant diversity in the news sources and perspectives it
seeks to sustain. The Bill also expressly provides that it is to be interpreted and applied in a
manner that is consistent with freedom of expression, journalistic independence and the neutral
treatment of news content by digital news intermediaries.
The bargaining framework created by the Bill applies to a range of ways in which digital news
intermediaries may make news content or portions of it available. This scope is designed to
support the objectives of the Bill and its effectiveness in a dynamic digital environment. Under
the Bill, a digital news intermediary could make news content available by reproducing it or by
facilitating access to the news content, including by generating links to news content.
Facilitating access to news content could be done through any means, including by way of an
index, aggregation or ranking, all of which are methods used by online platforms to organize and
distribute news content. However, the Bill does not automatically or necessarily require digital
news intermediaries to compensate news publishers when they make news content or portions of
it available, including when digital news intermediaries generate links to news content. Instead,
the Bill gives parties the flexibility to bargain over compensation based on the nature of the

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content and how it is made available by the intermediaries. In a complex and fluid market
environment, the Bill approaches the broad range of ways in which news content may potentially
be monetized – including to the benefit of digital news intermediaries, news publishers, or both
parties to a negotiation – in a consistent and format-neutral manner. In this way, the Bill is
designed to avoid disruptions to the ways in which news content is currently made available and,
in conjunction with its other features, to incentivize balanced and market-driven negotiations.
The Bill is carefully tailored to achieve its overarching objectives. News businesses are not
required to participate; they may choose whether to bargain under the regime. The Bill contains
measures to incentivize compensation arrangements that are negotiated between the parties.
Dominant digital platforms may be broadly exempted from obligations under the Act if they
independently negotiate agreements with news businesses. The Act provides that any such
agreements must not allow the freedom of expression and journalistic independence enjoyed by
news outlets to be undermined by corporate influence.
Where the Act is engaged and negotiated agreements are not achieved, the regime relies on a
final offer arbitration mechanism. This mechanism will resolve disputes on the basis of one of
the parties’ final offers. It will be available only for monetary disputes and only where
bargaining sessions and mediation have failed to produce a negotiated agreement. For the
purposes of the Act, fair compensation is closely tied to economic and other gain. By requiring
arbitrators to consider that digital platforms’ communication of news content can create benefits
and value for both digital platforms and news publishers, the Bill clarifies that fair compensation
should be assessed in a balanced fashion. Arbitrators would have the power to dismiss any offers
that could cause serious harm to the provision of news content to persons in Canada or were
otherwise inconsistent with the purposes of the Act. Digital platforms are also prohibited from
engaging in any undue preference or perpetuating any undue disadvantage in relation to their
dissemination of news content.

Role and powers of the Canadian Radio-television and Telecommunications Commission

The Bill would grant new roles and powers to the Commission. The Commission’s new
responsibilities would include drafting a Code of Conduct to guide negotiations; determining
which news businesses are eligible to participate; maintaining a list of digital news
intermediaries to which the Act applies; determining when a digital news intermediary may be
exempt from the regime because voluntary negotiated agreements satisfy statutory criteria;
supporting the arbitration process; receiving complaints about various matters related to the
framework; and applying administrative monetary penalties for non-compliance. The
Commission would also have the power to draft regulations to govern various aspects of the
operation of the Act.

The Bill authorizes the Commission to gather the information it requires to fulfil its
responsibilities. Persons designated by the Commission may also order the production of records
from a digital news intermediary operator or eligible news business where there are reasonable
grounds to believe the records will be relevant to verifying compliance with the Act or
preventing non-compliance. Parties who provide certain types of sensitive commercial
information to the Commission, including trade secrets, may designate this information as
confidential. Information designated as confidential would be subject to special use and

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disclosure restrictions backed by offence provisions. The Commission would have the authority
to disclose designated information in the public interest, after considering representations from
interested individuals and entities, or to disclose it to the Commissioner of Competition, where
the Commission considers the information to be relevant to competition issues that have arisen.
Both the responsible Minister and the Chief Statistician of Canada may request and obtain
information submitted to the Commission, including designated information, for the purpose of
performing their statutory functions.

Searches or seizures (section 8 of the Charter)

Section 8 of the Charter protects against “unreasonable” searches and seizures. A search or
seizure will be reasonable if it is authorized by a law, the law itself is reasonable in the sense of
striking an appropriate balance between privacy interests and the state interest being pursued,
and the search is carried out in a reasonable manner. Because the information gathering, sharing
and disclosure powers have the potential to interfere with privacy interests, they may engage
section 8.
The following considerations support the consistency of these powers with the Charter. The
information gathering, sharing and disclosure powers would not be available for penal purposes.
Instead, these powers would be used to support the important regulatory aims of the regime –
regulating digital news intermediaries to enhance fairness in the digital news marketplace and
contribute to its sustainability. Privacy expectations will be diminished in this regulatory context.
The Bill provides for the protection of confidential information. The restrictions on the use and
disclosure of information designated as confidential would be backed by offences for non-
compliance. Powers to gather, compel the production of, or disclose relevant information for
regulatory or administrative purposes, rather than for the purpose of investigating offences, have
been upheld as reasonable under s. 8. In reviewing the relevant provisions, the Minister has not
identified any potential effects that could constitute an unreasonable interference with privacy as
protected by s. 8.
Right to freedom of expression (section 2(b) of the Charter)

Section 2(b) may provide a limited right of access to documents in the possession of government
bodies. Such access is constitutionally protected only where, without the desired access,
meaningful public discussion and criticism on matters of public interest would be substantially
impeded. However, even where a case for public access is established, access may be declined
based on countervailing considerations. The limitations on public disclosure of confidential
information submitted to the Commission have the potential to engage section 2(b) of the
Charter.
The following considerations support the consistency of the prohibition restricting disclosure of
confidential information with section 2(b). The Bill does not generally restrict public access to
information submitted in the course of Commission proceedings. The restrictions on public
disclosure would apply only to specific and limited types of information, such as trade secrets,
where public disclosure could lead to harm. The prohibition on disclosure would not be absolute.
The Commission would have the discretion to provide public access to confidential information
if it determines that the disclosure is in the public interest.

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Fair trial rights (section 11 of the Charter)
Section 11 of the Charter guarantees certain procedural rights to persons who have been charged
with an offence. Its protections apply to proceedings that are “penal in nature” or that may lead
to “true penal consequences”. True penal consequences include imprisonment and fines with a
punitive purpose or effect, as may be the case where the fine or penalty is out of proportion to the
amount required to achieve regulatory purposes. Section 11(d) guarantees the right to be
presumed innocent until proven guilty according to law in a fair and public hearing by an
independent and impartial tribunal.
The Bill would create offences for contravening the prohibition on disclosing information
designated as confidential at Clause 55(2) and for contravening the prohibition on using
information disclosed to the Commissioner of Competition for unauthorized purposes at Clause
55(6). While not punishable by imprisonment, the proposed offence provisions would provide
for criminal charges, prosecution, and sentencing that could engage rights under section 11 of the
Charter. In reviewing the relevant measures, no potential inconsistencies between the offence
provisions and rights under section 11 have been identified.
The Bill would also create an administrative monetary penalty regime for certain violations of
the Act. Persons designated by the Commission could issue notices of violation where they have
reasonable grounds to believe that a violation has been committed. A notice of violation would
include the act or omission giving rise to the violation, the amount of the penalty, and a summary
of the person’s rights and obligations, including the right to make submissions to the
Commission with respect to the violation or the penalty. The Commission would determine, on a
balance of probabilities, whether the person committed the violation, subject to any undertakings
accepted by the Commission.
Administrative monetary penalties under the Act could give rise to the possibility of substantial
monetary penalties and therefore could potentially be perceived as impacting section 11 rights.
The following considerations support the consistency of the administrative monetary penalty
regime with the Charter. The proceedings leading to the imposition of a monetary penalty would
be administrative in nature. The purpose of these penalties would be to promote compliance with
the Act, not to “punish” as that concept is defined for the purpose of section 11 of the Charter.
The penalties would not be subject to any prescribed minimums and would be determined on the
basis of the compliance-related factors listed in the Bill. The Bill properly construed and applied
would not authorize the imposition of a penalty that could give rise to “true penal consequences”.

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