Australia is planning to come up with new rules to force big tech companies to pay local publishers for news. The new rules announced by the Australian government on Thursday will require social media platforms and search engines, whose annual Australian revenue is over $250m, to enter into commercial deals with media organisations or risk being hit with higher taxes.

The move succeeds the world-first law, passed by Australia in 2021, which was designed to make tech giants, such as Facebook-owner Meta Platforms and Alphabet’s Google, pay local publishers for the links that lure readers and advertising revenue.

With new rules, the Australian government is planning to pile pressure on global tech giants to pay publishers or face the risk of paying millions to continue operations in Australia.

“The news bargaining initiative will … will create a financial incentive for agreement-making between digital platforms and news media businesses in Australia,” Assistant Treasurer and Minister for Financial Services Stephen Jones said, according to a Reuters report. 

The charge will be offset for any commercial agreements that are voluntarily entered into between the platforms and news media businesses, Jones added.

The proposed new rules come as Australia toughens its approach to the mostly US-domiciled tech giants. Last month, Australia became the first country to ban children under the age of 16 from social media.

Canberra also plans to threaten the companies with fines for failing to stamp out scams.

That move is seen as setting a benchmark for other countries handling of big tech companies. 

What’s Next For Big Techs

Google, ByteDance through TikTok, and Meta through its various platforms would fall within the scope of the charges under the new rules. 

However, X, formerly Twitter, would not be covered under the regulations.

“The proposal fails to account for the realities of how our platforms work, specifically that most people don’t come to our platforms for news content and that news publishers voluntarily choose to post content on our platforms because they receive value from doing so,” a Meta spokesman said commenting on the proposed rules. 

Meta, which also owns Instagram, Threads and WhatsApp, has been scaling back its promotion of news and political content globally to drive traffic and says news links are now a fraction of users’ feeds.

In 2021, after Australia passed laws to make the US tech giants compensate media companies, Meta briefly blocked users from reposting news articles.

But, it later struck deals with several Australian media firms, such as News Corp and national broadcaster Australian Broadcasting Corp.

However, the company said it will not renew those arrangements beyond 2024 and would discontinue the news tab on Facebook in Australia and the United States. 

The company has already cancelled the tab last year in Britain, France and Germany. In 2023, it also blocked users in Canada from reposting news content after its government took similar action.