The Australian government has been wargaming scenarios if Meta pulled news from Facebook and Instagram, including whether it could force the company to carry news or influence it via the tax system, parliament has heard.
Facebook and Instagram’s parent company, Meta, announced in March it would not enter into new agreements with media companies to pay for news, following the end of contracts signed in 2021 under the Morrison government’s news media bargaining code.
The assistant treasurer, Stephen Jones, is considering whether the Albanese government should use the powers under the news media bargaining code legislation to “designate” Meta under the code, which would force the tech company to enter negotiations for payment with news providers, or risk fines of 10% of its Australian revenue.
News publishers have warned that Meta may pull news off Instagram and Facebook if designated, as the company did in Canada in August last year.
The Treasury’s assistant secretary in the competition and consumer branch, Tony McDonald, told a parliamentary inquiry into social media that the government was considering how to respond should this scenario play out.
“I think the experience we’re seeing internationally with digital platforms is that a static target won’t work because they will react and they’ll respond. And the challenge for sovereign governments is to work out how to react and respond in relation to that,” he said.
“So some of the nature of the work that we’ve been doing – any advice we’ve been providing to government – is thinking through those different scenarios.”
McDonald said he was not suggesting it was what Meta would do, but it was something being considered.
“We’ve been exploring … what might you be able to do to encourage them to continue, to encourage or force them [to] continue to carry news in those circumstances.”
The department was also assessing potential “must carry” rules to force Meta to keep news on its platforms, but they were being assessed as to whether they are compatible with the code and whether they would be enforceable.
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An alternative under consideration, McDonald said, was to understand to what extent taxing powers could be used to encourage platforms to comply with the news media bargaining code.
Legal advice had also been sought on how it might work to enforce any changes on a global tech company, McDonald said.
“Some of the challenges we have is applying the policy tools for an analogue world, where you have infrastructure that physically is here, and companies that are actually physically here and have key personnel here, to those that very much look like they’re operating here, but from a legal basis, that may not be quite as straightforward,” he said.
The chair of News Corp Australia, Michael Miller, told the committee last week that new laws should be introduced to force the social media companies to comply, and if they refuse then they should be banned in Australia.
The chair of Digital Publishers Alliance, Tim Duggan, responded that any news ban or platform ban would favour larger publishers the most.