US calls on Australia to drop proposed laws to make Facebook and Google pay for news

SYDNEY (Reuters) – The U.S. government has called on Australia to drop proposed laws that will make it the first country in the world to force Facebook Inc and Alphabet Inc’s Google to pay for information from local media.

In a communication calling on the government to “put on hold” the projects, Deputy US Trade Representatives Daniel Bahar and Karl Ehlers suggested Australia “to further study the markets and, if necessary, develop a voluntary code ”.

Under the law, which enjoys broad political support and is currently before a Senate committee, Google and Facebook will be subject to compulsory price arbitration if a trade deal on Australian media payments cannot be reached.

“The US government is concerned that an attempt, through legislation, to regulate the competitive positions of specific players … to the obvious detriment of two US companies, could lead to adverse results,” said in the document, under the Header of the President’s Executive Office.

Such a move could also “raise concerns about Australia’s international trade obligations,” he said.

The Australian government announced the legislation last month after an investigation found tech giants held too much market power in the media industry, a situation it said posed a potential threat to a democracy that works well.

Asked about a response to the US bid, Australian Treasurer Josh Frydenberg said in a statement that the government “is committed to adopting a binding code” that would address “bargaining power imbalances with digital platforms and companies. media”.

The code follows an 18-month review by the chairman of the Australian Competition and Consumer Commission (ACCC) and an “extensive consultation” that included views from Google and Facebook, he said. added.

The ACCC investigation found that for every A $ 100 of online ad spending, A $ 53 goes to Google, A $ 28 goes to Facebook, and A $ 19 goes to other media companies.

Following intense but unsuccessful Australian government lobbying from the two tech giants to abolish proposed laws, which they deem unfair, Google and Facebook have suggested they may be forced to limit their offers in the country.

(1 USD = 1.3014 Australian dollar)