Google and Facebook could face multimillion-dollar fines if they fail to comply with proposed legislation introduced in Australia’s parliament on Wednesday that would force tech giants to pay for the journalism they display.
Australian Treasurer Josh Frydenberg has laid out the so-called mandatory news media and digital platforms trading code and revealed details of his plan for Australia to become the first country to force digital platforms to compensate media information for journalistic content.
We are not seeking to shield traditional media companies from harsh competition or technological disruption, which we know benefits consumers, Frydenberg told parliament. Rather, we seek to create a level playing field where market power is not misused and where there is appropriate compensation for the production of original news content.”
Details of the bill will be considered by a Senate committee before lawmakers vote on it next year.
Breaches of the code, such as failure to bargain in good faith, would be punishable by a fine of 10 million Australian dollars ($7.4 million) or the equivalent of 10% of annual turnover in Australia .
If a platform and a news company fail to agree on a price for the news after three months of negotiations, a three-member arbitration panel would be appointed to make a binding decision for payment over at least two years.
The panel would then accept in full either the platform or the final offer from the news organization.
In very limited circumstances, when neither option is in the public interest, the panel can change the more reasonable of the two offers, according to government documents.
The bill does not specify how the payment would be made. The platform and the media company could agree on a lump sum or regular payments depending on the amount of news content used.
Facebook and Google said they would read the details of the bill before commenting.
Facebook has previously warned that it may block Australian news content rather than pay for it.
Google has previously said the proposed laws would cause significant damage to Google Search and YouTube, jeopardize free services, and could lead to users’ data being passed on to major news companies.
The government fears that Google will take 53% of online advertising dollars while Facebook has taken a 28% share without paying for the news the platforms share with their users.
Michael Miller, executive chairman of News Corp Australia, one of the country’s largest media organisations, hailed the legislation on Tuesday as an important step towards fairness.