Global streaming companies are lodging objections against recent Canadian regulations that mandate their contribution towards local news support. The Motion Picture Association-Canada, representing Netflix and Walt Disney Co, has initiated legal proceedings in federal court, seeking leave to challenge and review the rules imposed without legal justification.

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The Canadian Radio-television and Telecommunications Commission (CRTC) decreed in June that major online streaming services must allocate 5 percent of their Canadian revenues to bolster the national broadcasting system, including news creation.

MPA-Canada asserts that the decision lacks a valid rationale for forcing foreign online entities to fund news production and deems the CRTC's actions as unreasonable.

The allocated funds are earmarked for critical broadcasting sectors like local news on radio and TV, French-language, and Indigenous content, as identified by the regulator.

The CRTC refrained from commenting on ongoing litigation, maintaining that the directive, slated to be enforced from September, is estimated to yield approximately 200 million Canadian dollars annually.

Enacted under a law passed last year, the measure aims to ensure that online streaming services promote Canadian music and narratives, as well as sustain Canadian employment opportunities.

The MPA-Canada represents various streaming platforms, such as Paramount, Sony, NBCUniversal, and Warner Bros Discovery.