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Google, Facebook racing against the clock for changes to media code

In a sign the government anticipates its swift passage through the Senate, Mr Frydenberg and Mr Fletcher said the code would be reviewed by Treasury after one year “to ensure it is delivering outcomes that are consistent with the government’s policy intent”.

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The Treasurer has described the laws as a “world first” and said they would ensure news media businesses were fairly remunerated for the content they generated and from which digital platforms benefited.

The Senate committee delivered its findings after holding two days of public hearings over January and February, where it heard evidence from Google and Facebook as well as news publishers including News Corp and Nine Entertainment Co, owner of this masthead.

Liberal chair senator Slade Brockman said the committee was confident the bill would level the playing field between tech giants and news publishers “despite the concerns raised by various submitters and witnesses”.

“Its provisions will provide the basis for a more equitable relationship between the media and Google/Facebook and, through this, help safeguard public interest journalism in Australia,” Senator Brockman said in the report.

Labor and the Greens have given in-principle support to the laws, strengthening the prospects of its smooth passage through the Senate, where the government needs three extra votes.

Labor communications spokeswoman Michelle Rowland urged the government to make clear whether it was considering amendments to the code in light of threats by the tech giants to scale back their services in Australia if it passed unamended.

“The government needs to get its ducks in a row and circulate any amendments to end the uncertainty and level the playing field between the news media and digital platforms,” she said.

The Greens have flagged they will pursue a number of amendments, including explicit provisions requiring news outlets to spend any revenue they obtain under the code on public-interest journalism, and a review in 12 months to assess the impact on smaller publishers.

Independent South Australian senator Rex Patrick confirmed he would vote for the bill.

“This bill will support public-interest journalism here in Australian and that is far more important to me than the profits of a large foreign-based tech company,” he said.

Google has threatened to shut down its search engine in Australia if the laws pass unamended while Facebook has warned it will block the sharing of local news on its platform.

Both Google and Facebook maintain they are willing to pay for news, but argue the code is “unworkable” in its current form and exposes them to an “unknowable and unacceptable level of financial liability”.

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Google Australia director of government affairs, Lucinda Longcroft, said the company remained committed to achieving a “workable code”.

“We look forward to engaging with policymakers through the parliamentary process to address our concerns and achieve a code that works for everyone – publishers, digital platforms, and Australian businesses and users,” she said.

A Facebook spokeswoman said the company was reviewing the committee’s report.

“We hope the Australian government will agree on a workable solution that truly protects the long-term sustainability of the news industry,” she said.

The code uses the threat of mandatory arbitration to force the digital platforms to broker commercial deals with Australian media companies for the value they obtain from having news content in news feeds and search results. It will also force them to comply with a number of strict regulatory provisions, including giving media companies 14 days’ notice of major algorithm changes.

It is backed by major media companies including News, Nine and Guardian Australia, which have advocated for it to be legislated immediately.

In a statement, Nine said the issues had been “exhaustively” examined and “now is the time for action and for the media code to be legislated”.

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