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U.S. urges Australia to abandon news payment plan for tech giants

Christian Fernsby |
The United States has urged Australia to abandon its plan to force Google and Facebook to pay media outlets for their news content, saying there could be "long-lasting negative consequences" for consumers and companies.

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Topics: U.S.    AUSTRALIA   

Australia wants to force the U.S. tech giants to pay local media organisations for hosting news content or face millions of dollars in fines, in one of the most aggressive moves globally to check their power.

It will apply to Facebook's "News Feed" and Google searches, prompting the digital firms to threaten to limit the services they offer Australians.

In a submission to an Australian Senate inquiry in the draft legislation, the Office of the US Trade Representative called it a "burdensome" plan that will "exclusively target" two American companies "without having first established a violation of existing Australian law or a market failure".

"The US government is concerned that an attempt, through legislation, to regulate the competitive positions of specific players in a fast-evolving digital market, to the clear detriment of two US firms, may result in harmful outcomes," the submission says.

"There may also be long-lasting negative consequences for US and Australian firms, as well as Australian consumers."

The submission, dated January 15, argues the plan's mandatory arbitration process to determine compensation for news businesses is "fundamentally imbalanced" in their favour, as news production costs must be considered but not the costs incurred by digital platforms.

It also says the world-first rules "could raise concerns with respect to Australia's international trade obligations" by excluding foreign media from the compensation scheme.

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