By Ismail Shakil
OTTAWA (Reuters) - A Canadian regulator said on Wednesday it will impose a fee on Google to recover the cost of enforcing a law that requires large internet platforms to pay for news content on their websites.
The imposition of the levy on the Mountain View, California-based search engine giant comes at a time of increased tension between Canada and the United States over trade, border security, and a digital services tax on U.S. technology firms.
The Canadian Radio-television and Telecommunications Commission said the vast majority of its operations are funded by fees charged to the companies it regulates, and the cost recovery rule for the Online News Act will come into effect from April 1. The charge may vary from year to year and does not have an upper limit.
The CRTC finalized the rule after a period of public consultations, during which Google intervened to argue against its implementation saying it was "not a rational approach" to impose 100% of the costs on one entity.
Part of a global trend to make internet giants pay for news, Canada passed the law last year to address media industry concerns that tech companies were elbowing news businesses out of the online advertising market.
Only Alphabet (NASDAQ:GOOGL)'s Google and Facebook-parent Meta met the threshold of a large enough company that would need to pay news organizations.
Google, after months of negotiations with the government, agreed to pay C$100 million annually in a deal with publishers to keep news stories in search results. Meta, however, decided to block news from its Facebook (NASDAQ:META) and Instagram platforms in Canada to avoid payments.
Google, among other comments in its submission to the CRTC, argued the rule was "an unfair additional regulatory burden on a company that has continued to support the news ecosystem in this country."
In a policy notice posted to its website on Wednesday, the CRTC said due to the structure of the Online News Act, the recovery costs can only be levied on the digital platforms to which the law applies.
Google declined to comment beyond its response submitted during the CRTC consultation.