SYDNEY (Reuters) – The US government has asked Australia to drop proposed laws making it the first country in the world to force Alphabet Inc’s Facebook Inc and Google to pay for news from local media.
In a submission asking the government to “suspend” the plans, US Assistant Trade Representatives Daniel Bahar and Karl Ehlers suggested Australia should instead study the markets further and develop a voluntary code if necessary.
Under the law, which enjoys widespread political support and is currently before a Senate committee, Google and Facebook will be subject to mandatory price arbitration if a commercial agreement on payments to Australian media cannot be reached.
“The US government is concerned that an attempt, through legislation, to regulate the competitive positions of specific players … to the detriment of two US companies could lead to damaging results,” the document under the Executive Bureau’s letterhead said. from the president.
Such a move could also “raise concerns regarding Australia’s international trade obligations,” he said.
The Australian government announced the legislation last month after investigations showed the tech giants had too much market power in the media industry, a situation it believes posed a potential threat to a functioning democracy.
Asked for a response to the US submission, Australian Treasurer Josh Frydenberg said in a statement that the government is “determined to proceed with a mandatory code” that would address “the imbalances in bargaining power with digital platforms and media companies” .
The code followed an 18-month review by the Chair of the Australian Competition and Consumer Commission (ACCC) and “extensive consultation” with the views of both Google and Facebook, he added.
The ACCC survey found that for every A $ 100 in online advertising, A $ 53 goes to Google, A $ 28 to Facebook, and A $ 19 to other media companies.
After intensive but unsuccessful lobbying by the Australian government of both technology giants to strike proposed laws, which they deem unfair, Google and Facebook have suggested they may be forced to restrict their offerings in the country.
($ 1 = 1.3014 Australian dollars)
Reporting by Paulina Duran in Sydney; Editing by Richard Pullin