By Paul Vieira

OTTAWA--Canada's broadcast regulator on Tuesday said foreign streaming services like Netflix and Disney would need to contribute 5% of their Canadian sales to help fund local broadcast newscasts, and content for indigenous and francophone communities.

The Canadian Radio-television and Telecommunications Commission said the payments would begin in the 2024-25 broadcast year, starting Sept. 1, and are expected to annually contribute 200 million Canadian dollars, or the equivalent of $146 million. The order to hand over 5% of Canadian revenue would apply to streaming services with more than C$25 million sales in the country.

The financial contributions are mandated as part of a law that Canada's parliament adopted last year, which compels streaming services and digital platforms such as Alphabet's YouTube and Bytedance's TikTok, to prominently showcase Canadian programming to users in this country.

Officials said this marked an initial contribution from digital players to the Canadian broadcasting system, and suggested they may be ordered to pay more to help ailing Canadian broadcasters and the local artistic community. Canada's Liberal government has previously said that digital platforms and streaming services could end up making annual contributions totaling C$1 billion.

The decision "will help ensure that online streaming services make meaningful contributions to Canadian and indigenous content," said the regulator's chairwoman, Vicky Eatrides.

Representatives for Netflix, Disney and Amazon, owner of Amazon Prime Video, were not immediately available for comment. The Biden administration has previously warned Canada that measures targeting online streaming could "discriminate against U.S. businesses."

Write to Paul Vieira at paul.vieira@wsj.com


(END) Dow Jones Newswires

06-04-24 1008ET