From the Macdonald Laurier Institute

By Leonid Sirota and Mark Mancini

When it comes to regulating the internet, Ottawa tells Canadians to simply “trust the experts.”

The federal government has pursued a far-reaching internet regulation agenda. This includes the Online Streaming Act (previously known as Bill C-11) and the Online News Act (previously known as Bill C-18). Both are ostensibly designed to force foreign online platforms – streaming ones such as Netflix, Disney+, and YouTube in the former case, Google and Facebook in the latter – to provide support, mainly but not exclusively financial, to Canadian cultural and journalistic producers. The most recent addition to this regulatory programme, Bill C-63, partly targets online platforms too, but its reach is broader. It seeks to prevent a range of “online harms” – from the distribution of child pornography to hate speech.

These legislative endeavours have attracted commentary from all corners, not least from Macdonald-Laurier Institute experts. Much of the discussion has been critical of the government’s policies on the ground of their unwisdom, immorality, and possible unconstitutionality.

But we would like to take a different tack here and focus not on the ends pursued but the means employed by C-11, C-18, and C-63: the empowerment of administrative agencies as rule-makers and arbiters of Canadians’ online world. While they purport to regulate new technologies, business models, and cultural forms, these policies are a throwback to an old philosophy of government that subverts fundamental constitutional principles: democracy, the separation of powers, and the rule of law.

It is worth beginning with a brief restatement of what these principles mean. Democracy means the exercise of political power – law-making, in particular – by either the people themselves or, more commonly, through elected representatives. The separation of powers means that the making and execution of laws are different functions, not to be confused or conflated, and that adjudication of disputes in accordance with the law is a separate function still. The rule of law is a complex idea, but perhaps the pithiest formulation of its core meaning belongs to economist and political philosopher F.A. Hayek: it “means that government in all its actions is bound by rules … which make it possible to foresee how the authority will use its coercive powers in given circumstances.”

Contrast this with the philosophy underpinning the government’s approach to internet regulation. This philosophy permeated the report of a panel commissioned by the federal government at the end of the last decade to propose reforms to Canada’s regulation of the internet. Published in January 2020, “Canada’s Communications Future: Time to Act” called for legislation that would “provide sufficient guidance to assist the [Canadian Radio-Telecommunications Commission (CRTC)] in the discharge of its duties, but sufficient flexibility for it to operate independently in deciding how to implement sector policy. To achieve this, legislative statements of policy should set out broadly framed objectives and should not be overly prescriptive.” Translation: the democratically elected Parliament should not bother with making actual rules; that would be the job of the bureaucrats at the CRTC. They know better – both what the rules should be and how to apply them. Parliament is their enabler, not their master, and the courts should defer to their judgments.

In fairness, the legislation ultimately enacted or considered by Parliament does not go quite as far in empowering the CRTC or a new Digital Safety Commission (DSC) at the expense of Parliament as that report had urged. But it does go far. Probably the most important example of this concerns the amenability of user content – the average TikTok video, rather than Netflix – to CRTC regulation. This was one of the major points of contention when Bill C-11 was before Parliament. The Bill itself – despite claims by the government to the contrary – quite clearly permitted the CRTC to regulate user content, though it did not require it to do so. Amendments to remove this discretionary power were roundly rejected at the government’s insistence, in favour of leaving the user content question open for decision by the CRTC – only for the government to issue a Policy Direction to the CRTC “not to impose regulatory requirements” on user content.

The real scope of the law, and hence the degree of its impact on the freedom of expression of ordinary Canadians, will thus be fleshed out through the interplay of policy directions from Cabinet and CRTC consultations and orders. The same goes for various other aspects of the Online Streaming Act, such as Canadian content and discoverability requirements to be imposed on online platforms. The Online News Act, had it functioned as intended, would similarly have given the CRTC the final say over the extent of the obligations of the platforms subject to it. (In reality, one of these two platforms instead banned the publication of news content, and to avoid the other doing the same thing, the government made a deal with it that eviscerated the act.) And under Bill C-63, the decisions as to whether an online platform’s policies are “adequate to mitigate the risk that users … will be exposed to harmful content” is similarly within the remit of the DSC, with little if any guidance from Parliament as to what is in fact required.

This way of doing things undermines parliamentary democracy as anyone, except some scholars of administrative law would understand it. The people elected to make laws do not, in fact, make them in any meaningful way. On the contrary, they pawn off responsibility for contentious policy choices to administrators; they enact no more than empty shells, politely described as “framework legislation,” full of blanks to be filled out later. This transgression against constitutional principle is compounded when Cabinet makes a mockery of the parliamentary process with its policy flip-flops, which can then be reversed by further Cabinet fiat. The excuse typically given for this dereliction of duty is that the problems to be addressed are too complex for parliamentarians to deal with, which only makes one wonder at their nerve to have put themselves forward to do a job they are concededly unqualified for in the first place.

Enthusiasts for the internet agenda may say that it remedies its democratic deficiencies by consulting with those subject to new registration requirements. Yet CRTC consultations on the Online Streaming Act provided no more than a shabby ersatz of what democracy is supposed to mean – debate and discussion in Parliament. The submission period was short,  and “industry-focused.” The CRTC ended up issuing orders requiring registration on a range of internet services that meet a $10 million revenue threshold, and the government issued a policy direction to the CRTC instructing that user content not be regulated. The CRTC’s regulatory plan for the Online Streaming Act is still being developed, and will likely involve further decisions about the reach of registration requirements. Whether the DSC does any better – if and when it implements Bill C-63 – remains to be seen. But, in any case, consultations that only include industry players, or some nominal number of users, cannot replicate an engaged and informed Parliament that weighs competing interests. Nor can it replace an engaged and informed citizenry, holding politicians to account for their choices at the ballot box.

Separation of powers fares no better. Instead of Parliament making laws, independent prosecutors bringing charges, and independent courts ruling on them, the CRTC and DSC combine their broad rule-making powers with the ability to both jawbone and outright prosecute online platforms, and to rule on the charges. The Canadian Civil Liberties Association rightly laments “the vast authority bestowed upon” the DSC “to interpret the law, make up new rules, enforce them, and then serve as judge, jury, and executioner.”

Here again, proponents of administrative power think they have an answer. Instead of the old-fashioned institutions wielding divided powers, they say the modern world requires the government’s full authority to be concentrated in the hands of experts. Agencies like the CRTC and, presumably, the DSC have the skills and wisdom to deal with the complex and increasingly difficult online environment. This claim is attractive in part because the layman often cannot comprehend the size and scale of challenges that modern regulation confronts, while politicians are all too often happy to demonstrate their unseriousness and ignorance.

But, in addition to its other problems, the vision of expert administrators who know better is simply unwarranted by the facts. For example, Konrad von Finckenstein, former chair of the CRTC, has told a Senate committee studying Bill C-11 that the CRTC simply does not normally deal with matters of this nature; and that the CRTC will likely need to hire contractors to fulfil its mandate under the legislation. The CRTC is also, by its own admission, not really up to speed when it comes to the universe of online media it is required to regulate under the Online Streaming Act: it has invoked the need to gather information about podcasting to justify its far-reaching registration requirements for platforms that host them. As for the DSC, it will of course be an entirely new bureaucratic structure with no existing expertise at all. Perhaps the government will appoint experts to it. But it doesn’t have to. Bill C-63 imposes no requirements as to the qualifications of the DSC’s members other than their being Canadian citizens or permanent residents. Under the Canadian Radio-television and Telecommunications Commission Act, the same is also true of the CRTC.

Over-reliance on administrative regulation and enforcement undermines the rule of law too, by making the rules applicable to the internet uncertain and their application unpredictable. The legislation relies on vague terms that will only be fleshed out as the agencies that apply it go along, which will discourage innovation, chill expression, and incentivize platforms to take quick action against their users to avoid getting into trouble with the regulators. And if the victims of unfavourable rulings want to challenge them in actual courts, the Supreme Court’s precedents prevent judges from coming to their own independent assessment of what the law requires, but instead require them to yield to the bureaucrats’ interpretations unless these are not “merely” mistaken, but outright unreasonable. Even the requirements of the Canadian Charter of Rights and Freedoms are dissolved in this bureaucratic acid; from the supreme law of Canada, they are diluted into values that must, to be sure, be taken into account, but only as a factor among others.

All this may seem like legalistic pedantry propounded by academics who do not care about the pressing needs of contemporary society. But that impression would be mistaken. It is precisely the government’s disregard for Canada’s constitutional foundations that ultimately ensures that the rules produced for it by its administrative instrumentalities are out of touch.

Instead of legislation reflecting Canada’s public opinion as represented in Parliament, we are to be governed by rules drafted by unrepresentative bureaucrats, potentially influenced by special interest groups with a privileged access to them. Instead of the exercise of coercive power being channelled through institutions with limited remits keeping one another accountable, we are told to trust experts who cheerfully admit having no real expertise to speak of. And instead of the law being predictably and impartially applied by judges who are not invested in the government’s policy and do not depend on government goodwill for reappointment, the law, and the constitution itself, only count insofar as they are consistent with administrative need.

It may be that we are stuck with the administrative state. Although some scholars have made arguments to the contrary, we believe that, as a matter of law, Parliament is entitled to delegate very considerable policy-making powers to agencies such as the CRTC and the DSC. If the government is set on pursuing its regulatory agenda through the old-fashioned means of creating and empowering bureaucratic structures, the courts will not save us, even though, as we have argued elsewhere, they have become rather more skeptical of the administrative state’s claim to be the solution to all the problems of the modern world than they used to be until fairly recently.

But the government having the authority to do something does not mean that doing it would be a good idea. It, and we the citizens, should embrace the judiciary’s skepticism of the vision of government-by-administrator that characterizes the federal government’s plans. More to the point, we should recall what our most important constitutional principles mean. If we are not to erode them, we need to reject the means the government is proposing to employ, as well as, arguably, the ends it is pursuing.

Leonid Sirota is Senior Fellow with the Macdonald-Laurier Institute, and an Associate Professor in the School of Law at the University of Reading, in the United Kingdom, where he teaches public law. His research interests include the rule of law, constitutional interpretation, administrative law, the freedoms of conscience and expression, election law, and other aspects of Canadian and comparative public law.

Mark Mancini, a Senior Fellow with the Macdonald-Laurier Institute, is a Ph.D. candidate at the University of British Columbia, Peter A. Allard School of Law. He holds a J.D. from the University of New Brunswick, Faculty of Law, and an LL.M. from the University of Chicago Law School.