Google Agrees to Pay Canada’s Link Tax, Avoids Removing News from Search
Google has reached an agreement with Canadian news businesses to pay them $100 million per year in compliance with Canada’s Online News Act. Previously, Google had threatened to remove Canadian news links from its search and news platforms rather than make the required payments.
Under the deal, Google will contribute $100 million annually to support a wide range of news businesses in Canada, including independent news outlets and those serving Indigenous and official-language minority communities. This amount, denominated in Canadian currency, is equivalent to approximately $74 million in US currency. Prior to the agreement, the Canadian government estimated that Google’s annual payment obligation would be $172 million.
In response to the agreement, Minister of Canadian Heritage Pascale St-Onge stated, Google will contribute $100 million in financial support annually, indexed to inflation, for a wide range of news businesses across the country, including independent news businesses and those from Indigenous and official-language minority communities.
Google expressed gratitude to Minister St-Onge for addressing their concerns and engaging in productive discussions to find a resolution. The tech giant stated, After extensive discussions, the Canadian Government agreed to a number of changes to address our deeply held concerns that C-18 would require payment for links and create uncapped financial liability through an unworkable bargaining process, simply for helping Canadians find relevant and useful information.
The Canadian government confirmed that Google will have the option to negotiate with a single collective representing multiple news organizations instead of engaging individually with each outlet. Google will have the option to work with a single collective to distribute its contribution to all interested eligible news businesses based on the number of full-time equivalent journalists engaged by those businesses, said Minister St-Onge.
The new regulations, which will be implemented before the Online News Act takes effect on December 19, 2023, will provide a clear path for Google to continue sending valuable traffic to Canadian publishers while complying with the law.
However, Meta, the parent company of Facebook, remains steadfast in its opposition to making payments under the Online News Act. Last summer, Meta stopped distributing Canadian news on Facebook and Instagram after ending talks with the Canadian government. Canadian officials had estimated that Facebook would be required to pay $62 million annually, but the Google deal suggests that this amount could be significantly reduced.
Minister St-Onge emphasized the effectiveness of the legislation, stating, This [deal with Google] shows that this legislation works… Now it’s on Facebook to explain why they’re leaving their platform to disinformation and misinformation instead of sustaining our news system.
The forthcoming regulations and Google’s agreement highlight the ongoing efforts by governments worldwide to ensure fair compensation for news organizations operating in the digital era. While Google has chosen to comply with the payment requirements in Canada, Meta continues to resist, raising questions about the future of news distribution on social media platforms.
