OTTAWA – The Liberal government has unveiled the draft regulations that will implement its Online News Act, legislation that Google and Meta have said could lead them to permanently block news content on their platforms in Canada.
The government has said it hopes the new regulations will cause Google and Meta to reconsider those plans, but Meta remained unmoved Friday while Google said it’s still assessing whether its concerns have been addressed.
Government officials said that under the legislation Google could contribute $172 million a year and Facebook $62 million to Canadian news publishers, based on Google’s global search revenues and Meta’s Facebook global revenues. That’s about in line with previous department estimates but lower than the Parliamentary Budget Officer’s $329 million estimate last year.
But officials said those numbers could be revised up or down because the government is open to consulting with affected parties and adjusting the formula.
Since a stand-off with the tech giants began after the passage of the Online News Act (formerly known as Bill C-18), the government has been hoping Google and Meta’s issues with the law — such as the lack of a cap on how much they would have to pay news publishers — could be addressed through the regulatory process.
“As the legislation is based on the incorrect assertion that Meta benefits unfairly from the news content shared on our platforms, today’s proposed regulations will not impact our business decision to end news availability in Canada,” Rachel Curran, head of public policy for Meta Canada said in a statement.
Curran said “the regulatory process is not equipped to address the fundamentally flawed premise of the Online News Act.”
Google has suggested it is more open to compromise, although it has also said it plans to pull news from Google search and other products if its concerns aren’t addressed.
A Google spokesperson said Friday the company is “carefully reviewing the proposed regulations to assess whether they resolve the serious structural issues with C-18 that regrettably were not dealt with during the legislative process.”
The legislation, passed in June, would force the two tech giants to share revenues with news publishers (Postmedia, publisher of the National Post, has publicly supported the legislation). If the companies pull links to news articles from their platforms, the Online News Act will no longer apply to them.
On Friday, the government provided detail on how it would provide room in the regulations to allow Google and Meta to reach voluntary deals with publishers that could exempt the tech companies from being subject to the legislation’s mandatory bargaining and arbitration process administered by the CRTC. Those deals could include both monetary and non-monetary contributions.
That also means the total payments to news publishers could be lower than the government estimates.
To calculate the revenue-sharing payments, the government is using a formula that multiplies the platforms’ global revenue with the Canadian share of global GDP, multiplied by a contribution rate of four per cent. Exactly what the government will ultimately consider as “global revenues” was not made clear Friday — for instance, whether Meta’s revenues from its Instagram platform would be included.
The deals must also include “collectives of certain size representing independent local, Indigenous and official language minority community news businesses,” the government said in background document. Small, independent news publishers say they have been the hardest hit by Meta’s decision to start blocking news a month ago.
An official said the government is “looking forward to engaging with (Meta and Google) in a constructive manner in the weeks ahead on the proposed approach.”
Paul Deegan, CEO of publishers’ group News Media Canada, said at “first pass, the regulations appear fair and balanced to both publishers and platforms. It gives everyone a level of clarity and predictability, which we have been calling for and welcome.”
The draft regulations are now open for a 30-day consultation period before being finalized.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
Companies in this story: (TSX:TRZ)
The Canadian Press. All rights reserved.
Dollarama Inc.’s food aisles may have expanded far beyond sweet treats or piles of gum by the checkout counter in recent years, but its chief executive maintains his company is “not in the grocery business,” even if it’s keeping an eye on the sector.
“It’s just one small part of our store,” Neil Rossy told analysts on a Wednesday call, where he was questioned about the company’s food merchandise and rivals playing in the same space.
“We will keep an eye on all retailers — like all retailers keep an eye on us — to make sure that we’re competitive and we understand what’s out there.”
Over the last decade and as consumers have more recently sought deals, Dollarama’s food merchandise has expanded to include bread and pantry staples like cereal, rice and pasta sold at prices on par or below supermarkets.
However, the competition in the discount segment of the market Dollarama operates in intensified recently when the country’s biggest grocery chain began piloting a new ultra-discount store.
The No Name stores being tested by Loblaw Cos. Ltd. in Windsor, St. Catharines and Brockville, Ont., are billed as 20 per cent cheaper than discount retail competitors including No Frills. The grocery giant is able to offer such cost savings by relying on a smaller store footprint, fewer chilled products and a hearty range of No Name merchandise.
Though Rossy brushed off notions that his company is a supermarket challenger, grocers aren’t off his radar.
“All retailers in Canada are realistic about the fact that everyone is everyone’s competition on any given item or category,” he said.
Rossy declined to reveal how much of the chain’s sales would overlap with Loblaw or the food category, arguing the vast variety of items Dollarama sells is its strength rather than its grocery products alone.
“What makes Dollarama Dollarama is a very wide assortment of different departments that somewhat represent the old five-and-dime local convenience store,” he said.
The breadth of Dollarama’s offerings helped carry the company to a second-quarter profit of $285.9 million, up from $245.8 million in the same quarter last year as its sales rose 7.4 per cent.
The retailer said Wednesday the profit amounted to $1.02 per diluted share for the 13-week period ended July 28, up from 86 cents per diluted share a year earlier.
The period the quarter covers includes the start of summer, when Rossy said the weather was “terrible.”
“The weather got slightly better towards the end of the summer and our sales certainly increased, but not enough to make up for the season’s horrible start,” he said.
Sales totalled $1.56 billion for the quarter, up from $1.46 billion in the same quarter last year.
Comparable store sales, a key metric for retailers, increased 4.7 per cent, while the average transaction was down2.2 per cent and traffic was up seven per cent, RBC analyst Irene Nattel pointed out.
She told investors in a note that the numbers reflect “solid demand as cautious consumers focus on core consumables and everyday essentials.”
Analysts have attributed such behaviour to interest rates that have been slow to drop and high prices of key consumer goods, which are weighing on household budgets.
To cope, many Canadians have spent more time seeking deals, trading down to more affordable brands and forgoing small luxuries they would treat themselves to in better economic times.
“When people feel squeezed, they tend to shy away from discretionary, focus on the basics,” Rossy said. “When people are feeling good about their wallet, they tend to be more lax about the basics and more willing to spend on discretionary.”
The current economic situation has drawn in not just the average Canadian looking to save a buck or two, but also wealthier consumers.
“When the entire economy is feeling slightly squeezed, we get more consumers who might not have to or want to shop at a Dollarama generally or who enjoy shopping at a Dollarama but have the luxury of not having to worry about the price in some other store that they happen to be standing in that has those goods,” Rossy said.
“Well, when times are tougher, they’ll consider the extra five minutes to go to the store next door.”
This report by The Canadian Press was first published Sept. 11, 2024.
Companies in this story: (TSX:DOL)
TORONTO – The U.S. Consumer Financial Protection Bureau has ordered TD Bank Group to pay US$28 million for repeatedly sharing inaccurate, negative information about its customers to consumer reporting companies.
The agency says TD has to pay US$7.76 million in total to tens of thousands of victims of its illegal actions, along with a US$20 million civil penalty.
It says TD shared information that contained systemic errors about credit card and bank deposit accounts to consumer reporting companies, which can include credit reports as well as screening reports for tenants and employees and other background checks.
CFPB director Rohit Chopra says in a statement that TD threatened the consumer reports of customers with fraudulent information then “barely lifted a finger to fix it,” and that regulators will need to “focus major attention” on TD Bank to change its course.
TD says in a statement it self-identified these issues and proactively worked to improve its practices, and that it is committed to delivering on its responsibilities to its customers.
The bank also faces scrutiny in the U.S. over its anti-money laundering program where it expects to pay more than US$3 billion in monetary penalties to resolve.
This report by The Canadian Press was first published Sept. 11, 2024.
Companies in this story: (TSX:TD)
The Canadian Press. All rights reserved.
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