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Stefan Labbé, Glacier Media – Jun 2, 2023 / 1:13 pm | Story: 429950
Photo: Glacier Media file photo.
The Catalyst paper mill in Powell River was indefinitely shut down not long after Paper Excellence purchased it.
Earlier this year, Paper Excellence capped off an unprecedented series of multibillion-dollar buyouts to become the largest forestry company in Canada.
Members of Parliament investigating the company’s business ties and corporate structure learned Friday that Industry Canada did not conduct a net benefit analysis to see if company’s recent US$3-billion purchase of Domtar and US$2.7-billion buyout of Resolute Forest Products were in the economic interests of Canadians.
NDP natural resource critic Charlie Angus said he was “absolutely gobsmacked.”
“How is it possible the government could say that there wasn’t an obligation to question the net benefit to Canada?” said Angus.
“I certainly can’t see there’s any benefit in turning over our forests, our environment to a company that’s a series of shell companies, and they refuse to tell us who owns it.”
The federal probe follows the release of a journalistic investigation by the International Consortium of Investigative Journalists (ICIJ) that found a series of links — including leaked emails, corporate documentation, shipping records and interviews with former employees — connecting Paper Excellence, ostensibly owned by Jackson Wijaya, and APP, headed by Wijaya’s father.
The committee motion to investigate Paper Excellence, passed in March, called on Wijaya and Minister of Innovation, Science and Economic Development Francois-Phillipe Champagne to answer questions. Neither Wijaya nor Champagne have appeared before the committee.
On Friday, officials from Champagne’s ministry told MPs net benefit reviews of foreign acquisitions only occur in cases where they meet certain guidelines — including whether they are linked to military supply chains, espionage, critical minerals, sensitive technology, or are near a sensitive site or military base.
Paper Excellence — a foreign-owned company, controlled through a number of shell companies — does not meet that bar because its acquisitions dealt in the purchase of pulp and paper infrastructure and logging concessions now totalling more than 22 million hectares (roughly seven times bigger than Vancouver Island).
“I want to know if anybody representing the Canadian government thought there were red flags when turning over such a massive amount of forest,” said Angus.
“Because if they didn’t think any of that mattered, then God help Canada.”
Bloc Québécois MP Mario Simard questioned senior department officials whether its national security review of the deals revealed Paper Excellence was ultimately controlled by Asia Pulp and Paper (APP).
“The link that we’re trying to see is the link between Mr. Wijaya and another firm,” Simard said through an interpreter.
“My question is quite simple: do you have the result of an analysis, which yes or no… does establish a link between Mr. Wijaya and Asia Pulp and Paper?”
Mark Schaan, the department’s senior assistant deputy minister of strategy and innovation policy sector, said Jackson Wijaya was found to be the beneficial owner of Paper Excellence. Schaan declined to comment on any links it found between Paper Excellence and APP, citing confidentiality agreements under the Investment Canada Act.
A day before the meeting, Glacier Media and other ICIJ media partners reported on a 2017 briefing note provided to the Nova Scotia government affirming Paper Excellence was ultimately controlled by APP.
On Tuesday, a Paper Excellence executive told MPs ties had been cut with APP in 2015, two years earlier.
Dan Albas, Conservative MP for B.C.’s Central Okanagan-Similkameen-Nicola riding, asked Schaan to provide any documentation that would refute the links drawn in the Nova Scotia government briefing note. The department official once again said the confidentiality agreement prevented him from doing so.
Angus later put the committee on notice. In addition to summoning Wijaya, he would request ministerial briefing notes and documentation related to national security reviews conducted in Paper Excellence’s acquisitions of Domtar and Resolute.
Earlier this week, Conservative MP and natural resources critic Shannon Stubbs said she would back Angus’s motion to summon Wijaya, and would submit her own motion to summon Minister Champagne to answer questions before the committee.
Since the investigation was announced, Angus said Paper Excellence lobbyists had put “heavy pressure” on a number of MPs with mills in their ridings. He said he was concerned “scaring local communities” would get in the way of the committee’s obligation to carry out due diligence.
“This is not a witch hunt. This is about giving Canadians accountability and answers,” Angus said.
“My message to Mr. Wijaya is ‘you got a good story to tell? Then come and tell it,’ because what was done behind the scenes under the protection of the confidentiality agreements doesn’t cut it.”
They investigation is scheduled to continue June 6.
The Canadian Press – Jun 2, 2023 / 10:35 am | Story: 429931
Photo: The Canadian Press
Kerry Benjoe, editor of Eagle Feather News, poses for a photo at First Nations University of Canada in Regina on Wednesday March 15, 2023. THE CANADIAN PRESS/Michael Bell
Independent publishers across Canada are expressing mixed feelings about Meta’s decision to temporarily block news on Instagram and Facebook for some Canadian users.
The company says it’s a response to the Liberal government’s Bill C-18, which would require tech giants to pay publishers for linking to or otherwise repurposing news content, and it plans to block news in Canada completely if the bill passes in the Senate.
Kerry Benjoe, president of Eagle Feather News Media in Saskatchewan, says she relies on Facebook to grow her newspaper’s audience, which she uses to grow her ad revenue.
She says her team of four heavily relies on social media as a tool to reach people they wouldn’t otherwise reach, especially in remote Indigenous communities.
But William Pearson, co-publisher of Peterborough Currents, is against the online news bill because he believes he won’t benefit from it, and he says publishers need to develop ways to reach people that aren’t mediated by tech companies.
He says while he relies on Facebook to promote his digital platform, he’s more focused on growing the business through subscriptions, newsletters and interacting with his community in person.
The Canadian Press – Jun 2, 2023 / 10:00 am | Story: 429918
Photo: The Canadian Press
The Real Estate Board of Greater Vancouver says May home sales rose 15.7 per cent from a year earlier.
The B.C. board says Vancouver’s housing market is showing signs of heating up heading into the summer, as prices increased for the sixth consecutive month.
The board says sales for the month totalled 3,411, which was 1.4 per cent below the 10-year seasonal average of 3,458.
The composite benchmark price for all residential properties in Metro Vancouver was $1,188,000 last month, down 5.6 per cent from a year ago but up 1.3 per cent from April.
There were 5,661 new listings last month, an 11.5 per cent decrease compared with a year ago and 4.3 per cent lower than the 10-year seasonal average of 5,917.
Andrew Lis, the board’s director of economics and data analysis, says in a release that prices are increasing because there are more buyers than sellers in the market, keeping resale homes in short supply.
Lis says the higher sales in May nearing historical averages were a “surprising twist” amid higher interest rates and slower new listing activity.
“If mortgage rates weren’t holding back market activity so much right now, I think our market would look a lot like the heydays of 2021/22, or even 2016/17,” he says.
The Canadian Press – Jun 2, 2023 / 9:20 am | Story: 429904
Photo: The Canadian Press
DesRosiers Automotive Consultants Inc. says May brought hope after several years of disrupted sales patterns, as vehicle sales rose.
The consultancy firm says total light vehicle sales in May were up 13.5 per cent from a year ago.
Sales totalled 159,705 units in May, up 10.9 per cent from April.
However, sales were still 21.0 per cent below pre-pandemic levels.
But the firm says that with the economy proving resilient and a predicted recession not yet in sight, there is optimism that the market could see a stronger summer for sales.
DesRosiers managing partner Andrew King says in a statement that the seasonally adjusted annual rate for May was 1.54 million units, breaking a three-month run of consecutive declines.
The Canadian Press – Jun 2, 2023 / 9:16 am | Story: 429903
Photo: The Canadian Press
Air Canada says travellers should be prepared for further flight disruptions as it works to return service to normal following a technical malfunction Thursday.
In its daily travel outlook, the carrier said that while its IT system is now stable, flights may be affected at nine of Canada’s busiest airports, including Toronto’s Pearson, Montreal, Vancouver and Calgary.
Thursday’s outage led to more than 500 flights — over three quarters of its trips — to be delayed or cancelled on the day, creating what the airline says are “rollover effects” that may lead to further delays Friday.
“Air Canada has stabilized its communicator system and it is functioning normally. However, due to the effects of Thursday’s IT issues on our schedule, some flights may be delayed this morning as we reposition aircraft and crew,” it said in an emailed statement.
“Customers are advised to check the status of their flight before going to the airport. Our flexible travel policy remains in effect for customers to change their travel plans at no charge.”
The source of the disruption was in the system used by the airline to communicate with aircraft and monitor their performance, which Air Canada has been in the process of upgrading.
On May 25, it grounded its planes for about an hour when the system experienced a separate issue, causing delays for nearly half of Air Canada’s flights that day.
A total of 89 Air Canada flights, or 17 per cent of the airline’s scheduled load, had been delayed Friday as of around 11:30 a.m. EDT, along with 32 cancellations, according to tracking service FlightAware.com.
An additional 40 flights with Air Canada Rouge saw delays, plus 19 cancellations.
The Canadian Press – Jun 2, 2023 / 9:15 am | Story: 429902
Photo: Alberta Wildfire
The wildfires plaguing residents in Alberta and Nova Scotia are part of a larger trend that’s driving up the cost of home insurance as extreme weather becomes more common, insurance experts say.
“Premiums in Canada have been increasing for some time already,” said Marcos Alvarez, global head of insurance at DBRS Morningstar.
After a large event like the wildfires dominating Canadian headlines, customers in those geographical areas might see their policies re-priced, said Alvarez, or might see insurers becoming more involved: “When you have losses of this magnitude, you might reassess how you approach your underwriting price.”
Over time, these changes on a local level will contribute to the larger trend, he said.
According to a July 2022 report by Ratesdotca, home insurance premiums in Ontario had risen around 10 per cent in less than a year, with increasing incidences of severe weather one of several factors contributing to higher costs for homeowners, especially those in smaller population centres.
A similar report published a year earlier found that home insurance rate growth was well outpacing inflation, with average home insurance rates in Alberta up 140 per cent over 10 years to $1,779 as of early 2021, while in Ontario the average annual rate was up 64 per cent to $1,284.
Larger losses are the biggest contributor to higher premiums, whether those losses are due to natural disasters, inflation or other rising costs, said Daniel Ivans, an insurance expert with Ratesdotca.
“When you have a loss, it’s more expensive now than it’s ever been,” he said.
According to the Insurance Bureau of Canada’s annual report, severe weather caused $3.1 billion in insured damage in 2022, up from $2.1 billion in 2021, and the third worst year in Canadian history. The Fort McMurray fire put 2016 in the highest spot at almost $6 billion.
The increasing cost of insuring homes at risk for damage from extreme weather was highlighted this week in California, when insurer State Farm announced it would no longer accept commercial and residential insurance applications in the state due to “historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure and a challenging reinsurance market.”
The trend where certain risks become less, or completely, uninsurable because of climate change is happening around the world, said Alvarez. State Farm isn’t even the first insurer to leave the California market, he noted.
Insurers in Canada face the same problems as State Farm, said Craig Stewart, IBC’s vice-president of climate change and federal issues. These include higher costs for rebuilding and reinsurance, plus more frequent events like wildfires, he said.
But it’s unlikely Canada will see an insurer make the same move as State Farm any time soon, said Alvarez. For one, home insurance prices in California are regulated, meaning insurers have limits on how much they can charge, while in Canada insurers don’t have the same barriers.
The California situation is extreme, Stewart said, with fires becoming not just more common, but essentially a predictable event.
“Living in California is akin to living on a floodplain in Canada,” he said. “We know that the disaster is going to happen.”
Ivans said while insurers in Canada sometimes pause new business amid a disaster, this happens rarely and is only a matter of days or weeks.
Alvarez said while homeowners are currently covered for wildfires as part of standard home insurance, they’re underinsured for other risks, including flooding.
When a segment becomes uninsurable, it’s a public policy problem, he said. That’s often when the government steps in, which it did with flooding, promising to create a national low-cost flood insurance program in the latest federal budget.
Alvarez thinks we could see the Canadian government getting more involved in insurance in the future if other natural disasters become increasingly difficult to insure against.
“Wildfire could be a potential candidate for some sort of public program if this becomes more and more prevalent,” he said.
As weather events become more extreme, it is becoming more challenging for insurers to keep coverage affordable without government partnerships, said Stewart.
The National Flood Insurance Program, once developed, can be used as a framework for covering other types of extreme weather, said Stewart.
“So it’s a national flood insurance program now, but built to be multi-peril in the future,” he said.
However, Stewart said it’s clear Canada needs more than just insurance for weather events, as the current wildfire situation is showing a lack of preparation and investment in certain areas, he said.
Extreme weather is highlighting the need for risk mapping, awareness campaigns, infrastructure improvements and other elements making up a “holistic game plan” for natural disasters, said Stewart.
“We’re seeing these events now year after year after year,” he said.
“We’re having catastrophic events several times a year in some parts of the country, and so these aren’t flukes. We now have to realize that this is now going to be the trend moving forward.”
The Canadian Press – Jun 2, 2023 / 9:09 am | Story: 429901
Photo: The Canadian Press
Canada’s main stock index leaped more than 200 points in late-morning trading as gains in energy, industrials and base metal stocks drove the rise, while U.S. stock markets also shot up.
The S&P/TSX composite index was trading up more than one per cent or 217.66 points to 19,889.91.
In New York, the Dow Jones industrial average was up 505.32 points to 33,566.89. The S&P 500 index increased by 51.86 points to 4,272.88, while the Nasdaq composite grew 133.52 points to 13,234.50.
The Canadian dollar traded for 74.39 cents US compared with 74.17 cents US the day before.
The July crude contract was up US$1.57 at US$71.67 per barrel and the July natural gas contract was up seven cents at US$2.22 per mmBTU.
The August gold contract was down US$14.30 at US$1981.20 an ounce and the July copper contract was up two cents at US$3.73 a pound.
The Associated Press – Jun 2, 2023 / 7:33 am | Story: 429887
Photo: NASA
Boeing’s astronaut capsule faces more launch delays after the discovery of problems that should have been caught earlier, officials said.
Boeing and NASA announced the latest setback Thursday.
Until recently, the Starliner capsule was on track for a July test flight with two astronauts to the International Space Station, a planned trip that was already well behind schedule.
But final reviews uncovered issues with the parachute lines and other problems that were present on last year’s test flight with no one on board and, officials said, should have been caught years ago.
As for whether Starliner might fly by year’s end, Boeing program manager Mark Nappi said, “I think it’s feasible, but I certainly don’t want to commit to any dates or time frames” until the problems are fixed.
The capsule is full of wire harnesses wrapped in white tape that’s flammable, according to Nappi. Rather than trying to remove the hundreds of feet of tape, which was supposed to protect against scuffing, the company may cover it with a safer material.
The parachute lines also were not designed to be strong enough to meet safety standards.
“These tests were run many years ago. We reviewed those results. We missed those results, and this could have been caught sooner,” Nappi said.
Following the retirement of the space shuttles more than a decade ago, NASA hired Boeing and SpaceX to transport astronauts to and from the space station. SpaceX has now completed 10 crew flights, three of them private. Boeing had to repeat its 2019 test flight without a crew because of software and other issues.
“NASA desperately needs a second provider for crew transportation,” said Steve Stich, the space agency’s commercial crew program manager.
The goal is to have one SpaceX and one Boeing taxi flight to the station each year.
The Canadian Press – Jun 2, 2023 / 7:31 am | Story: 429886
Photo: The Canadian Press
Lululemon Athletica Inc. reported net income of US$290.4 million for the first quarter of 2023, up almost 53 per centfrom US$190.0 million a year earlier.
The Vancouver-based company, which reports in U.S. dollars, says net revenue for the quarter was US$2.0 billion, up 24 per centfrom US$1.6 billion the same quarter last year.
The retailer, which trades on the NASDAQ, says diluted earnings per share were US$2.28, up from US$1.48 a year earlier.
Lululemon chief financial officer Meghan Frank says an acceleration of sales in China and lower air freight costs contributed to the company’s better-than-planned financial performance.
While net revenue increased by 17 per cent in North America, Lululemon says it increased by 60 per cent internationally.
The company revised its net revenue outlook for the full fiscal year upwards to between US$9.4 billion and US$9.5 billion, going from approximately 15 per cent growth to 17 per cent.
The Associated Press – Jun 1, 2023 / 5:50 pm | Story: 429828
Photo: The Canadian Press
FILE — Supporters of Airbnb hold a rally outside City Hall in New York, Jan. 20, 2015. Airbnb sued New York City, Thursday, June 1, 2023, over an ordinance that the company says imposes arbitrary restrictions that would greatly reduce the local supply of short-term rentals. (AP Photo/Bebeto Matthews, File)
Airbnb sued New York City on Thursday over an ordinance that the company says imposes arbitrary restrictions that would greatly reduce the local supply of short-term rentals.
The 2022 ordinance, which the city plans to begin enforcing next month, would require owners to register with the mayor’s office, disclose who else lives in the property, and promise to comply with zoning, construction and maintenance ordinances.
Airbnb said called the restrictions “extreme and oppressive” and a de facto ban against short-term rentals that left the company no choice but to sue.
“Taken together, these features of the registration scheme appear intended to drive the short-term rental trade out of New York City once and for all,” Airbnb said. The company said the mayor’s Office of Special Enforcement “failed to consider reasonable alternatives.”
A spokesman for Mayor Eric Adams said city hall will review the lawsuit.
“This administration is committed to protecting safety and community livability for residents, preserving permanent housing stock, and ensuring our hospitality sector can continue to recover and thrive,” said the spokesman, Jonah Allon. “The rules governing short-term rentals … have been clear for years,” and the 2022 registration law was properly adopted by the city council, he added.
San Francisco-based Airbnb filed the lawsuit in state court in Manhattan. Three Airbnb hosts filed a companion lawsuit against the city.
Airbnb sued New York state in 2016 over a ban on advertising short-term rentals. It dropped that lawsuit when the city promised not to enforce it. In 2020, Airbnb settled a lawsuit against the city over monthly reporting requirements for its listings. Airbnb said the 2022 ordinance violates both settlements.
The New York restrictions are among many efforts by local communities to regulate short-term rentals without banning them. New Orleans is among cities taking on the rental giant, after a court struck down a previous law.
In some places, opponents have raised concerns about noise and safety. Critics also say the growth of short-term rentals pioneered by Airbnb has contributed to a shortage of affordable housing for residents, particularly in vacation towns. Those complaints extend far beyond U.S. borders.
On Thursday in Italy, the popular tourist destination of Florence announced an immediate ban on new vacation rentals in the city’s historic center.
Photo: The Canadian Press
The daughter of hockey star Tim Horton has retired as a franchisee in the coffee chain that bears his name, urging her peers to “keep demanding better” as declining profitability has led to tensions with parent company Restaurant Brands International Inc. QSR-T
In a letter sent to fellow franchisees in April, which was obtained by The Globe and Mail, Jeri Horton-Joyce announced her retirement effective May 31. She owned three Tim Hortons locations in Cobourg, Ont., and one in nearby Colborne, Ont.
In a statement, Tim Hortons president Axel Schwan confirmed that Ms. Horton-Joyce had transferred her restaurants to a family member, “and in addition to other extended family members who are current franchisees, this means that these important family legacies with the Tim Hortons brand will continue.”
Recently, Ms. Horton-Joyce was part of the board of directors of the Alliance of Canadian Franchisees (ACF), an independent group representing some disgruntled Tim Hortons franchisees. The ACF board resigned in March after Restaurant Brands International (RBI) sent default notices to the Tim Hortons owners serving on the board. RBI also terminated the franchise contract of its president, Ron Fox, at the time.
The board members had only been in their roles for a short time after the ACF appointed a new executive director the previous fall. The group had raised concerns in February about falling profits at Tim Hortons, a problem the parent company’s executives have said is a priority to address.
Ms. Horton-Joyce did not attribute her retirement decision to the recent tensions, writing only that the move came “sooner than I anticipated but for a variety of reasons it is the right time,” according to the letter. “I will still have family involved in the business and I want them to continue to prosper.”
Ms. Horton-Joyce declined a request for comment. ACF executive director Dave Lush also declined to comment.
“I am asking that everyone continue to help keep this fantastic brand going and to make it what we know it can be,” Ms. Horton-Joyce wrote in the letter. “Keep demanding better, never give up.”
Sales across the Tim Hortons chain have been going up, but cost pressures have squeezed restaurant owners’ profits. In February, Restaurant Brands disclosed that the average Tim Hortons location made $220,000 in earnings before interest, taxes, depreciation and amortization (EBITDA) in 2022 – down from $320,000 in 2018 when the company last reported those numbers. It has committed to reporting profit numbers annually in the future.
Last month, RBI chief executive Joshua Kobza said that franchisee profitability improved in its first quarter, though the company also acknowledged that it has continued to pass on rising commodity prices to franchisees. On a call to discuss first-quarter earnings, RBI executive chair Patrick Doyle said franchisee profitability is being given greater weight in incentive compensation for employees. But Mr. Doyle also reiterated a message that a “small number” of franchisees who were not “all in” on the company’s plans will be leaving the system.
Despite the tensions, Restaurant Brands says the vast majority of restaurant owners whose franchise agreements have come up for renewal in recent months have remained with the business. Since January, RBI has granted 215 new restaurant agreements to existing franchisees, and declined five owners who wanted to renew, according to the company.
Ms. Horton-Joyce’s decision was preceded by her husband and co-owner, Ron Joyce Jr. – son of the chain’s co-founder and first franchisee – who previously retired from the business.
“The Horton and Joyce families have contributed so much to Canada’s culture and fabric over the last 60 years. Jeri and Ron have all my best wishes for their retirement,” Mr. Schwan wrote in his statement.
Ms. Horton-Joyce’s brief tenure on the board of the breakaway franchisee group was not her first time in the spotlight. In 2018, she and Mr. Joyce drew widespread criticism after they cut back on paid breaks and reduced employee benefits at two locations in Cobourg. A memo from the owners claimed the changes were necessary because of the increase in Ontario’s minimum wage that year.
Ms. Horton-Joyce spent 37 years with the company as a franchise owner and operations representative. In her letter, she wrote about her memories of her father bringing home product recipes and coffee blends, turning to his family as a “test market,” although she added that the children were not permitted to drink the coffee “until our feet could touch the floor.”
“Hang in there,” she wrote. “Better times hopefully will return soon.”
The Associated Press – Jun 1, 2023 / 3:54 pm | Story: 429827
Photo: The Canadian Press
Assemblywoman Buffy Wicks, D-Oakland, left, discusses her measure that would force Big Tech companies to pay media outlets for using their news content, with Assemblyman Al Muratsuchi, D-Torrance, at the Capitol in Sacramento, Calif., Thursday, June 1, 2023. If approved by the Senate and signed by the governor, the bill would require companies such as Google and Meta to share with California media companies their advertising revenue stemming from the news and other reported content Muratsuchi wanted to make. (AP Photo/Rich Pedroncelli)
A California bill that would force Big Tech companies to pay media outlets for posting and using their news content cleared another critical hurdle Thursday.
The measure is among hundreds of bills that passed in the state Senate and Assembly this week before Friday — the last day a bill can pass out of its original chamber and get a chance to become law later this year.
The bill, which passed the Assembly floor with bipartisan support, would require companies such as Google and Meta to share with California media companies their advertising revenue stemming from the news and other reported content. The amount would be determined through an arbitration process. The bill would also require at least 70% of the shared revenue go toward journalists’ salaries.
Such payments would help local media organizations survive after many have seen their advertising revenues nosedive in the digital era, said the bill’s author, Democratic Assemblymember Buffy Wicks. California has lost more than 100 news organizations in the past decade, she said.
“The California Journalism Preservation Act will not save journalism, but it will provide a support for news outlets and journalists at a moment when the stakes could not be higher,” Wicks said Thursday.
The bill is backed by major journalism unions such as the News Media Alliance and Media Guild of the West, which represents The Los Angeles Times and other newsrooms. The California Labor Federation joined in supporting the bill Thursday, saying the bill would protect journalism jobs by “leveling the playing field between publishers and social media websites.”
Meta, which owns Facebook and Instagram, threatened to pull all news content from its platforms if the bill becomes law. The company has made similar threats to the U.S. Congress in 2022 and the Canadian government this year when those lawmakers attempted similar measures to bolster local journalism.
Meta also said the California bill would create a “slush fund” primarily benefiting out-of-state newspaper chains and hedge funds.
“The bill fails to recognize that publishers and broadcasters put their content on our platform themselves and that substantial consolidation in California’s local news industry came over 15 years ago, well before Facebook was widely used,” a Meta spokesperson said in a statement a day ahead of the vote. “It is disappointing that California lawmakers appear to be prioritizing the best interests of national and international media companies over their own constituents.”
Wicks called Meta’s statement “an empty threat,” noting that “these are companies that have made billions and billions and billions of dollars while our newsrooms are shutting down across the state of California.”
Google didn’t immediately respond to a request for comment.
Opponents of the bill, including LION Publishers, a national news group representing more than 450 independent newsrooms, have also raised concerns that the measure would encourage more clickbait news content. An analysis of bill, conducted by the Legislature, says news organizations would more likely invest in high-quality and investigative journalism if they are financially healthy. The analysis also said concerns the bill would potentially violate the First Amendment are “mostly overstated.”
Republican Assembly member Bill Essayli, who co-authored the bill, said it doesn’t impose a tax on Big Tech.
“I do not support corporate welfare, … but I also do not support unjust enrichment,” Essayli said Thursday. “If you’re taking other people’s work product and you’re financially benefiting from it, you must compensate them for it.”
Democratic Assembly member Al Muratsuchi urged Wicks to continue working with local news organizations to make sure small and ethnic-owned newsrooms are not left behind. Wicks said she’s committed to resolve that concern.
“I know that this is still a work in progress, but what I also know is that doing nothing is not an option,” Wicks said.
The bill now heads to the state Senate.
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