Mandatory mediation at the Small Claims Division: Merchants, be prepared!

January 19, 2016

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Lavery closely monitors new developments in consumer law and is committed to keeping the business community informed of the latest developments in this area of the law by regularly publishing newsletters dealing with new case law or legislative changes which may impact, influence, or even transform practices in the retail sector.

The current projects of the legislator respecting judiciary case management of consumer law may very well modify the manner in which merchants handle customer complaints. In this respect, consumer law is a privileged child of the Code of civil procedure reform.
Indeed, the Quebec government recently implemented a mandatory mediation pilot project for the Small Claims Division of the Court of Québec. On May 15, 2015, the Regulation to establish a pilot project on mandatory mediation for the recovery of small claims arising out of consumer contracts¹ (the “Regulation”)²came into force. Pursuant to the Regulation, mandatory mediation is imposed on the parties where the claim before the Small Claims Division arises from a consumer contract. A consumer contract includes any agreement between a merchant and a consumer for the acquisition of goods or services.³ When one considers that the Small Claims Division has jurisdiction to hear cases with a value of up to $15,000, it follows that a significant portion of the retail industry is covered by this pilot project.

The pilot project, which is established for 3 years, only covers the judicial districts of Gatineau and Terrebonne,⁴ but we expect that the government will make it applicable throughout the province if the results are positive. To a certain extent, Quebec would follow suit with neighbouring Ontario, where mediation is mandatory for all matters that come before the Small Claims Court.⁵

WHAT JUSTIFIES MANDATORY MEDIATION?

Mandatory mediation gives concrete expression to one of the guiding principles of the new Code of Civil Procedure (hereinafter, the “NCCP”) that came into force on January 1, 2016, which is to ensure accessibility to the courts and swiftness of civil justice. This is particularly illustrated by the fact that the legislator dedicated Title I of Book I of the NCCP to private dispute prevention and resolution processes. Contrary to these private dispute prevention and resolution processes such as negotiation, mediation and arbitration chosen by mutual agreement of the parties,⁶ the pilot project establishes mandatory mediation. The legislator therefore gives preferred treatment to judiciary claims between consumers and merchants, which may be explained by two objectives:

(i) Free up the courts and promote swift access to justice

Approximately 25% of the cases at the Small Claims Division concern claims involving consumer contracts.⁷ In addition, a study of the Office de la protection du consommateur published in 2010 reveals that 83% of the merchants continue to refuse mediation.⁸ One may think that the legislator wishes to reverse the trend and compel the parties to reestablish their communication in order to settle their disputes according to mutually agreed upon conditions. This measure will free up the courts, thus promoting swift access to justice.

(ii) Restore the balance between the parties in a consumer contract

The imbalance between consumers and merchants⁹ has always been a source of concern for the legislator. By making mediation mandatory as part of the pilot project, the government reaffirms its will to protect consumers by requiring merchants to discuss with them before an impartial third party in order to settle a dispute which ended up before the courts. Making consumer contracts subject to mandatory mediation a priority is explained by the fact that consumer contracts rank among the most common contracts, with personal consumption expenses in Quebec representing more than 100 billion dollars (which includes the automobile and food sectors).¹⁰ The obligation to submit these cases to mediation thus promotes maintaining harmony between the parties, which is an essential element to the sector’s health.

WHAT MAY WE EXPECT?

The process begins when the Small Claims Court clerk notifies the parties that they are subject to mediation.¹¹ Our interpretation of the Regulation makes us conclude that this notice will be sent by the clerk once the defence is filed with the Court. The clerk must offer the mediation mandate to a mediator whose name is on the list of mediators that he has drawn.¹²These mediators are lawyers or notaries certified by their professional orders.¹³

Once appointed, the mediator communicates with the parties to agree on a date and time for the mediation session.¹⁴ The process is intended to be swift: the mediator must hold the mediation session within 30 days following the date on which his mandate has been confirmed to him in writing.¹⁵ When a party fails to attend the mediation session so fixed or to agree on holding such a session, the mediator files with the court office a report stating that it is impossible to proceed with the mediation and the case may therefore be heard by the court.¹⁶However, the court may penalize a party’s failure to participate in the mandatory mediation by condemning such party to pay the legal costs or damages or, if the faulty party is the creditor, by reducing or cancelling the interests payable to that party.¹⁷

If the mediation is successful, the parties file either a notice that the case has been settled or the agreement they have signed.¹⁸ If it is not, the mediator sends to the clerk, within 10 days of the mediation session, a report giving an account of the facts, the positions of the parties and the questions of law raised.¹⁹ The case may then be heard by the court.²⁰

MAY ONE REQUEST TO BE EXEMPTED?

Having a vested interest for the pilot project to be successful, the government has provided that a party may only be exempted from participating in the mandatory mediation session for a serious reason.²¹ A party who wishes to be exempted from mandatory mediation must make an application in writing to the court not later than 20 days after being notified by the clerk that a case is subject to mediation.²² The clerk informs the other parties of the application; they then have 10 days to present their observations in writing.²³

HOW TO PREPARE FOR MEDIATION?

By making mediation mandatory, the government sends a clear message to merchants: they will have to modify some of their complaint processing practices. In order to make the process efficient, and taking into account the fact that time with the mediator is limited, the prior preparation of the mediation session will have a significant impact on its orientation and on the outcome of the dispute. By being well prepared, a merchant will better understand his case, both from a factual and legal point of view, and will be able to highlight the weaknesses of the consumer’s case, if any.

In order to be well prepared in the event that the merchant would face a suit and would then have to attend a mediation session, it is crucial for the merchant to do his homework in advance. Thus, he may find it beneficial to establish a clear complaint and claim management policy. Although the structure of the management policy may depend on the nature and the scope of the operations of the enterprise, merchants should minimally address the following questions when developing his policy:

a	Are calls with consumers recorded? With their consent?
b	Are reliable notes of all communications and interventions with consumers taken? In which way?
c	Is there a particular person or persons assigned full-time to complaint and claim management or is the file entrusted with the representative who knows best about the facts of the case?
d	Does the merchant wish to examine the goods which are the subject of the dispute?
e	Does he want to give a mandate to an expert? How should he proceed?
f	Is a response to the demand letter to be sent? In which cases? In which cases will the customer be contacted by phone?
g	Are third parties or witnesses involved in the matter?
h	May compensation, other than monetary compensation, be offered to the consumer in order to settle the dispute?

Once this policy is established, the following has to be done for each matter:

a	establish the facts in dispute in chronological order
b	prepare the documentary or material evidence (ex.: invoices, correspondence, recordings, etc.)
c	determine what are the practices of the sector in similar situations
d	determine the position and the arguments
e	quantify the claim
f	fix a scale to calculate how much the merchant would be prepared to pay to settle the claim

Lastly, the merchant would be well-advised to hold regular meetings with legal counsel to take stock of the claims subject to mandatory mediation. This will allow him to validate the legal framework of his file and the strategy to adopt at the mediation session. If the merchant establishes a clear complaint and claim management policy and ensures that it is well implemented in his enterprise, these periodic meetings will be quick and efficient.

WHAT ARE THE BENEFITS?

Mandatory mediation offers definite benefits to the merchant. Firstly, the process is swift and cost-efficient. In fact, the services of the mediator are free since his fees are assumed by the Ministère de la Justice.²⁴ As for the consumer, he can only be satisfied to be offered the opportunity to present his case to an impartial person without being subject to the usual judicial formalities before the court. Secondly, a successful mediation allows the merchant to avoid the risk of seeing the name of his enterprise associated with an unfavourable judgment, sometimes being cited out of context, thus allowing him to protect his image. Thirdly, mediation is a flexible process, the parties are free to negotiate the parameters of their settlement to achieve a mutually satisfying solution.

Moreover, since mediation is confidential,²⁵ the information shared during the process cannot be used in legal proceedings if mediation is unsuccessful. Lastly, the process may allow the merchant to better understand the consumer’s case and prepare accordingly for a trial should mediation fail. However, this statement is subject to a caveat: even if the mediation session reveals the other party’s cards, one must always remember that the parties are required to participate in good faith.²⁶In other words, the merchant should not participate in the mediation session for the sole purpose of verifying the solidity of the consumer’s case, but rather attend with the sole objective of trying to find a solution to the dispute.²⁷

WHAT IS THE BOTTOM LINE?

One has to keep in mind that with the pilot project which subjects the claims arising from a consumer contract to mandatory mediation, the legislator wants to promote the dialogue between consumers and merchants. The merchant may participate in this dialogue in an effective manner by establishing a clear complaint and claim mangement policy, which may also include a resolution process which would take place before matters are submitted to the court. Such an approach allows the merchant to quickly demonstrate the seriousness of his file, thus maximizing his chances of achieving a profitable settlement.

A merchant can only derive benefits from the process, as establishing a dialogue with consumers shows that he has a clear understanding of his customers’ needs.

Regulation to establish a pilot project on mandatory mediation for the recovery of small claims arising out of consumer contracts, CQLR, c. C-25.01, r. 1.
In accordance with articles 28 and 836 of the Act to establish the new Code of Civil Procedure, S.Q. 2014 c. 1.
According to section 1 of the Regulation, the definition given to the expression “consumer contract” is that set out in article 1384 of the Civil Code of Québec, that is, “a contract whereby one of the parties, being a natural person, the consumer, acquires, leases, borrows or obtains in any other manner, for personal, family or domestic purposes, property or services from the other party, who offers such property and services as part of an enterprise which he carries on.”
Prec., note 1, s. 1.
Rules of the Small Claims Court, Reg. 258/98 (Ont.), s. 13.01.
Prec., note 2, art. 1.
Pierre-Claude LAFOND, L’accès à la justice civile au Québec : portrait général, Cowansville, Éditions Yvon Blais, 2012, p. 140.
Pierre-Claude LAFOND, L’accès à la justice civile au Québec : portrait général, Cowansville, Éditions Yvon Blais, 2012, p. 138.
Pierre E. AUDET, “La médiation obligatoire pour les petites créances d’au plus 15 000 $ découlant d’un contrat de consommation”, Justice privée et décrochage judiciaire, Les Entretiens Jacques-Cartier, Montréal, October 3, 2014.
Luc THIBAUDEAU, Guide pratique de la société de consommation, Cowansville, Éditions Yvon Blais, 2013, p. 157. In 2014, the retail sector has represented in excess of 505 billion dollars in Canada: http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/trad15a-eng.htm.
Id.
Prec., note 1, s. 6.
Id., s. 7.
Id., s. 22.
Id., s. 21..
Id., s. 26.
Id., s. 27.
Préc., note 1, s. 28.
Id., s. 29.
Id.
Id., s. 2. For the purposes of the Regulation, the expression serious reason particularly means the existence of an order preventing a party from being in the presence of the other party, the fact that the travelling expenses related to the party’s participation in the mediation exceed the possible advantages or the fact that the parties have already participated in a mediation session for the same dispute.
Id., s. 3.
Id.
Prec., note 1, s. 12.
Id., s. 18 to 20.
Id., s. 16.
Id., s. 16.

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Despina Mandilaras
Senior Associate
Myriam Brixi
Partner, Lawyer

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Almost two years after the issuance of the Single-use Plastics Prohibition Regulations, where do we stand and how are businesses affected?

On December 20, 2022, the federal government's Single-Use Plastics Prohibition Regulations1 (the “Regulations”) gradually came into force, with the effect, as the name suggests, of prohibiting (or restricting, in certain cases) the manufacture, import and sale of certain single-use plastics that pose a threat to the environment. In principle, it is now prohibited to manufacture, import and sell certain single-use plastic products made entirely or partially of plastic, such as foodservice ware, checkout bags and straws. On June 20, 2024, beverage ring carriers and flexible straws packaged with beverage containers have been added to this list.2 However, there are cases currently pending before the courts that have the potential to change the situation. Currently contested: the Regulations and the Order A contestation to the Regulations has been before the Federal Court since July 15, 2022, in an application for judicial review brought by Petro Plastics Corporation Ltd et al3 (the “Petro Plastics Case”). However, the parties to this case have asked for it to be suspended pending a final judgment in another case4 brought by the Responsible Plastics Use Coalition (the “Coalition Case”).5 In the Coalition case, the validity of the order by which plastic products were added to the list of toxic substances in Schedule 1 of the Canadian Environmental Protection Act (“CEPA”)6 is called into question. The Federal Court of Appeal will soon hear this case and render a judgment that will affect the Petro Plastics case. On November 16, 2023, in the Coalition Case, the Federal Court ruled in favour of the Coalition, retroactively quashing the Order Adding a Toxic Substance to Schedule 1 to the Canadian Environmental Protection Act (the “Order”) and declaring it invalid and unlawful as of April 23, 2021.7 Essentially, the Federal Court had two main reasons for concluding that the registration was illegal. Findings of the Federal Court Order found unreasonable The Federal Court concluded that the Order was unreasonable because the evidence that the federal government had in hand did not support the conclusion that all plastic manufactured articles were toxic within the meaning of CEPA. On the contrary, the evidence showed that certain plastic manufactured articles included in the scope of the Schedule 1 list were not toxic. According to the Federal Court, the government acted outside its authority by listing the broad category of plastic manufactured articles on Schedule 1 in an unqualified manner. Order found unconstitutional The Federal Court also concluded that the Order was unconstitutional because it did not fall within the federal government’s criminal law power. Only substances that are toxic in “the real sense” can be included on the list of toxic substances. They must be substances that are harmful, dangerous to the environment or human life, and truly have the potential to cause harm. In other words, according to the Federal Court, the power to regulate the broad and exhaustive category of “single-use plastics” lies with the provinces. The Attorney General of Canada appealed this decision with the Federal Court of Appeal on December 8, 2023. The Federal Court of Appeal granted a stay of the judgment rendered on November 16, 2023, until disposition of the appeal,8 such that the Order and the Regulations remain in force, at least for the time being. If the Federal Court of Appeal upholds the decision that the Federal Court rendered on November 16, 2023, this will affect the validity of the Regulations. Under section 90 of CEPA, a substance can only be added to Schedule 1 by order if the federal government determines that it is toxic within the meaning of CEPA, and, under section 93 of CEPA, the government only has the power to regulate such a substance after it has been added to the list. The plastic items in question Subject to the outcome of the court cases discussed above, here is the exhaustive list of items that the Regulations prohibit: Single-use plastic ring carriers designed to surround beverage containers in order to carry them together.9 Single-use plastic stir sticks designed to stir or mix beverages or to prevent a beverage from spilling from the lid of its container.10 Single-use plastic foodservice ware that (a) is formed in the shape of a clamshell container, lidded container, box, cup, plate or bowl, (b) is designed to serve or transport ready-to-eat food or beverages and (c) contains certain materials.11 Single-use plastic checkout bags designed to carry purchased goods from a business and : (a) whose plastic is not a fabric,12 or (b) whose plastic is a fabric that will break or tear, as the case may be, (i) if it is used to carry 10 kg over a distance of 53 m 100 times; (ii) if it is washed in accordance with the washing procedures specified for a single domestic wash in the International Organization for Standardization standard ISO 6330, as amended from time to time.13 Single-use plastic cutlery that is formed in the shape of a fork, knife, spoon, spork or chopstick and that (a) contains polystyrene or polyethylene; or (b) changes its physical properties after being run through an electrically operated household dishwasher 100 times.14 Single-use plastic straws that either (a) contain polystyrene or polyethylene, or (b) change their physical properties after being run through an electrically operated household dishwasher 100 times. Exceptions Single-use flexible plastic straws Single-use flexible plastic straws, i.e., those with a corrugated section that allows the straw to bend and maintain its position at various angles,15 may be manufactured and imported.16 These flexible straws may also be sold in any of the following circumstances:17 The sale does not take place in a commercial, industrial, or institutional setting. This exception means that individuals can sell such flexible straws. The sale is between businesses in packages of at least 20 straws. The sale of a package of 20 or more straws is between a retail store and a customer if the customer requests straws and the package is not displayed in a manner that permits the customer to view the package without the help of a store employee.18 The sale of straws is between a retail store and a customer, if the straw is packaged together with a beverage container and the packaging was done at a location other than the retail store. The sale is between a care facility, such as a hospital or long-term care facility, and its patients or residents. Export of single-use plastic items All the manufactured single-use plastic items listed above may be manufactured, imported or sold for export until December 20, 2025.19 That said, any person who manufactures or imports such items for export will be required to keep a record of certain information and documents as appropriate for each type of plastic manufactured item.20 Records of the information and documents will have to be kept for at least five years in Canada.21 Conclusion: an opportunity to rethink the use of plastics In the short term, businesses will need to start thinking about how they will replace the plastic manufactured items they use. To help businesses select alternatives to single-use plastic items, the federal government has released its Guidance for selecting alternatives to the single-use plastics in the proposed Single-Use Plastics Prohibition Regulations.m22 According to this document, the aim should be to reduce plastics. Businesses may begin by considering whether a single-use plastic product should be replaced or no longer provided. Only products that perform essential functions should be replaced with non-plastic equivalents. Stir sticks and straws can be eliminated most of the time. Another way to reduce waste is to opt for reusable products and packaging. Businesses are invited to rethink their products and services to provide reusable options. Reusable container programs (i.e., offering customers the option of bringing their own reusable containers) are a reuse option that businesses may want to consider, in particular to reduce the amount of plastic foodservice ware. Only where reusable products are not feasible should businesses substitute a single-use plastic product with a recyclable single-use alternative. In such cases, businesses are encouraged to contact local recycling facilities to ensure that they can successfully recycle the products at their end of life. Ultimately, charging consumers for certain single-use alternatives (e.g., single-use wooden or moulded fibre cutlery) may also discourage their use. SOR/2022-138 Regulations, ss. 3 (2), s. 11 and ss. 13 (4) Petro Plastics Corporation Ltd et al v Canada (Attorney General), Court File No. T-1468-22. Order registered on April 23, 2021 and published in the Canada Gazette on May 12, 2021 Court File No. T-824-21 S.C. 1999, c. 33 Responsible Plastic Use Coalition v. Canada (Environment and Climate Change) 2023 FC 1511 2024 FCA 18 Regulations, s. 1 and 3 Regulations, s. 1 and 6 Regulations, s. 1 and 6 “Any material woven, knitted, crocheted, knotted, braided, felted, bonded, laminated or otherwise produced from, or in combination with, a textile fibre” as defined in section 2 of the Textile Labelling Act, RSC 1985, c. T-10 Regulations, s. 1 and 6 Regulations, s. 1 and 4 and ss. 5 (1) Regulations, s. 1 Ibid, s. 4 Regulations, ss. 5 (2)–(6) According to Guidance for selecting alternatives to the single-use plastics in the proposed Single-Use Plastics Prohibition Regulations, the goal is to ensure that people with disabilities who need flexible single-use plastic straws continue to have access to them at home and can carry them to restaurants and other premises. Regulations, ss. 2 (2), s. 10 and ss. 13 (5). Ibid., s. 8 Ibid, ss. 9 (1). https://www.canada.ca/en/environment-climate-change/services/managing-reducing-waste/consultations/proposed-single-use-plastics-prohibition-regulations-consultation-document.html

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Bill 8: Amendments to the Code of Civil Procedure to improve access to justice

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We note the following, in particular: Jurisdiction of the Court Exclusive jurisdiction granted to the Court of Québec to hear applications in which the amount claimed or the value of the subject matter of the dispute is less than $75,000,6 instead of $85,000, which is the limit in effect on the date of this bulletin. However, the Court of Québec will continue to hear applications under the $85,000 limit that were filed prior to June 30, 2023, and these will remain governed by the provisions of the C.C.P., as they read before June 30, 2023;7 Concurrent jurisdiction with that of the Superior Court granted to the Court of Québec where the amount claimed or the value of the subject matter of the dispute is equal to or exceeds $75,000 but is less than $100,000.8 Case management The Bill also introduces a special procedure for applications in civil matters brought before the Court of Québec in which the amount claimed or the value of the subject matter of the dispute is less than $100,000:9 The preparation of a case protocol will no longer be necessary, as set time limits will now apply to all recourses;10 Originating applications must not exceed five pages in length;11 Preliminary exceptions must be disclosed within 45 days of filing an application;12 A defendant’s arguments must be disclosed within 95 days of filing an application;13 Settlement conferences will be held automatically after trial readiness is achieved (settlement conferences may also be replaced by pre-trial conferences);14 Cases will be set down for trial and judgment by a court clerk.15 Requests for particulars as to allegations made or to strike immaterial allegations The Court of Québec will only authorize such requests by way of exception and if warranted on serious grounds.16 Examinations The limit below which holding an oral examination on discovery is not permitted will be increased to $50,000.17 Currently, the limit is $30,000; Each party will be entitled to only a single oral examination on discovery, unless the Court decides otherwise;18 Written examinations must not exceed three pages in length.19 Expert opinion Parties must seek a joint expert opinion in cases where the amount claimed or the value of the property claimed is equal to or less than $50,000, unless the Court decides otherwise.20 Small claims With the parties’ consent, the Court may render judgment on the face of the record when the matter concerns the recovery of a claim of $15,000 or less.21 Adjustments Each of the monetary limits for the Court of Québec’s jurisdiction will be adjusted annually.22 Conclusion The proposed measures will significantly impact how lawyers will now handle and manage disputes in which the amount claimed is less than $100,000. The concurrent jurisdiction of the Court of Québec with that of the Superior Court for cases with a value equal to or exceeding $75,000 but less than $100,000 is interesting: Although the procedure for conducting proceedings in the Court of Québec has been simplified for such cases, it is likely that many cases will nonetheless be instituted in the Superior Court, as its procedural process is a little less intrusive, particularly with respect to joint expert opinions, mandatory settlement conferences and the number of examinations. The Minister of Justice is hopeful that the amendments to the Act will improve access to justice for persons subject to trial, thanks to faster and less costly justice services, among other things. While these amendments will allow for more out-of-court settlements and prevent costly trials, we believe that there is still some uncertainty as to how accessible the expedited process will be, given the current staffing shortages in courthouses. 1. An Act to improve justice efficiency and accessibility, in particular by promoting mediation and arbitration and by simplifying civil procedure in the Court of Québec, Bill 8 (Introduced — February 1, 2023), 43rd Legislature, 1st Session (Qc) (“B.”). 2. Courts of Justice Act, CQLR c. T-16. 3. Professional Code, CQLR, c. C-26. 4. Code of Civil Procedure, CQLR c. C-25.01. 5. Transitional provision: claims of $85,000 initiated in the Court of Quebec before June 30, 2023 will continue under the provisions in effect prior to the coming into force of the PL amendments (PL, s 44). 6. B., s. 3; C.C.P., art. 35. 7. B., s. 44. 8. B., s. 3; C.C.P., art. 35. 9. B., s. 8; C.C.P., art. 535.1. 10. B., s. 8; C.C.P., art. 535.2. 11. B., s. 8; C.C.P., art. 535.3. 12. B., s. 8; C.C.P., art. 535.5. 13. B., s. 8; C.C.P., art. 535.6. 14. B., s. 8; C.C.P., art. 535.12. 15. B., s. 8; C.C.P., art. 535.13. 16. B., s. 8; C.C.P., art. 535.11. 17. B., s. 7; C.C.P., art. 229. 18. B., s. 8; C.C.P., art. 535.9, para. 2. 19. B., s. 8; C.C.P., art. 535.9. 20. B., s. 8; C.C.P., art. 535.15. 21. B., s. 15; C.C.P., art. 561.1. 22. B., s. 3; C.C.P., art. 35.

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Cybersecurity and the dangers of the Internet of Things

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April 26, 2022

Bill C-18 (Online News Act): Canada looking to create a level playing field for news media

Earlier this month, Canadian Heritage Minister Pablo Rodriguez introduced Bill C-18 (Online News Act) in Parliament. This bill, which was largely inspired by similar legislation in Australia, aims to reduce bargaining imbalances between online platforms and Canadian news outlets in terms of how these “digital news intermediaries” allow news content to be accessed and shared on their platforms. If passed, the Online News Act would, among other things, require these digital platforms such as Google and Facebook to enter into fair commercial agreements with news organizations for the use and dissemination of news related content on their platforms. Bill C-18, which was introduced on April 5, 2022, has a very broad scope, and covers all Canadian journalistic organizations, regardless of the type of media (online, print, etc.), if they meet certain eligibility criteria. With respect to the “digital news intermediaries” on which the journalistic content is shared, Bill C-18 specifically targets online communication platforms such as search engines or social media networks through which news content is made available to Canadian users and which, due to their size, have a significant bargaining imbalance with news media organizations. The bill proposes certain criteria by which this situation of bargaining imbalance can be determined, including the size of the digital platform, whether the platform operates in a market that provides a strategic advantage over news organizations and whether the platform occupies a prominent position within its market. These are clearly very subjective criteria which make it difficult to precisely identify these “digital news intermediaries.” Bill C-18 also currently provides that the intermediaries themselves will be required to notify the Canadian Radio-television and Telecommunications Commission (“CRTC”) of the fact that the Act applies to them. The mandatory negotiation process is really the heart of Bill C-18. If passed in its current form, digital platform operators will be required to negotiate in good faith with Canadian media organizations to reach fair revenue sharing agreements. If the parties fail to reach an agreement at the end of the negotiation and mediation process provided for in the legislation, a panel of three arbitrators may be called upon to select the final offer made by one of the parties. For the purposes of enforceability, the arbitration panel’s decision is then deemed, to constitute an agreement entered into by the parties. Finally, Bill C-18 provides digital platforms the possibility of applying to the CRTC for an exemption from mandatory arbitration provided that their revenue sharing agreements meet the following criteria: Provide fair compensation to the news businesses for news content that is made available on their platforms; Ensure that an appropriate portion of the compensation would be used by the news businesses to support the production of local, regional and national news content; Do not allow corporate influence to undermine the freedom of expression and journalistic independence enjoyed by news outlets; Contribute to the sustainability of Canada’s digital news marketplace; Ensure support for independent local news businesses, and ensure that a significant portion of independent local news businesses benefit from the deals; and Reflect the diversity of the Canadian news marketplace, including diversity with respect to language, racialized groups, Indigenous communities, local news and business models. A bill of this scope will certainly be studied very closely by the members of Parliament, and it would not be surprising if significant amendments were made during this process. We believe that some clarifications would be welcome, particularly as to the precise identity of businesses that will be considered “digital information intermediaries” for the purposes of the Online News Act.

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