Google announced on Jan. 22 that they will shut down their search engine services if a new law requiring the organization to pay news publishers for their content passes.

The company said this law would “break the way Google works” because it would require them to pay to show news articles on their platform. The company would need to negotiate with local news organizations and a government-appointed arbitrator if a decision can’t be made.

“The most critical of these [concerns] is the requirement to pay for links and snippets in Search,” said Mel Silva, Managing Director of Google Australia and New Zealand

“It’s not compatible with how search engines work, or how the internet works, and this is not just Google’s view – it has been cited in many of the submissions received by this Inquiry.”

The law was designed to help struggling news agencies in the country, which many argue that large tech corporations have benefited too long from their work without proper payment.

This new law would require Google and other large companies like Facebook to share the revenue they make off of media companies.

Google and Facebook argue that these companies do benefit from their partnership because they receive clicks and referrals from larger platforms. This new law would put that partnership in jeopardy.

The U.S. government intervened and asked Australia to scrap the proposed law. Assistant US trade representatives, Daniel Bahar and Karl Ehlers, suggested that Australia “further study the markets, and if appropriate, develop a voluntary code.” 

The Australian government introduced this legislation in December after an investigation found that tech companies held too much market power in the media industry, which allegedly poses a threat to a well-functioning democracy.

Australian Treasurer, Josh Frydenberg, said the government was “committed to proceeding with a mandatory code” that would address “the bargaining power imbalances with digital platforms and media companies.”

The law is currently in front of a senate committee.

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Written ByJasmine Perry

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