The new code, which the Australian Parliament passed on Thursday, “will ensure that media companies receive adequate compensation for the content they generate,” Australian treasurer Josh Frydenberg said in a statement.
The country’s unprecedented new law had been hotly debated in recent months. Facebook ( and )Google ( had spoken out against the original version of the legislation, which would have allowed the media to negotiate either individually or jointly with them – and to initiate binding arbitration if the parties could not reach an agreement. Facebook even shut down news sites in Australia last week to oppose the legislation. However, earlier this week it was announced that it would restore it after the country made some changes to the code, including a provision that “must take into account whether a digital platform has made a significant contribution to the sustainability of the Australian news industry by reaching advertising agreements with” News media company. “ )
Arbitration is only used as a “last resort” after a period of “good faith” mediation.
Following these revisions, Facebook said the new agreement would allow it to “support the publishers we selected”. A contract was later announced with the major Australian news company Seven West Media, with the aim of entering into further contracts with other publishers.
Google had already tried to push the new legislation by announcing partnerships with media organizations in Australia, including Seven and Rupert Murdoch News Corp. (. )
The Australian government said the code will be reviewed by the finance department after a year to “ensure that it produces results that are in line with the government’s political intentions”.
While Facebook has found a workaround for its problems in Australia, it remains vigorously defending its opposition to similar far-reaching measures.
“The events in Australia show the danger of camouflaging an offer of cash subsidies that is distorting the way the Internet works,” wrote Nick Clegg, vice president of global affairs for the company, in a blog post on Wednesday.
Clegg, a former UK Deputy Prime Minister, spoke in his statement about the company’s decision to end communications in the country, admitting that the move “would have felt abrupt and dramatic for many”.
“It was not an easy decision,” he wrote, adding that the company “had discussed with the Australian government for three years to explain why this proposed law, which was not changed, was not enforceable.”
The company had no choice but to take swift action last week “because it was required by law before the new law came into effect”.
The showdown is to continue. Similar case studies could soon emerge in other countries, with the United States and the European Union facing increasing pressure to take such action. The Canadian government has also announced that it will introduce laws in the coming months.
– Julia Horowitz contributed to this report.