Amid tussle with Facebook, Australia passes law requiring tech firms to pay for news

The Australian Parliament on Thursday passed the news media and digital platforms mandatory bargaining code that will make it compulsory for Alphabet's Google and Facebook to pay media companies for news content.

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The Australian government said it was pleased to see "progress by both Google and more recently Facebook" in reaching commercial arrangements with Australian news media.

Facebook had earlier cut off news in Australia amid tense negotiations with the government. The new code makes Australia the first country where a government arbitrator will set the rates which the tech giants have to pay.

Tech giant Google will now have to pay for news content that appears on its "Showcase" and Facebook is expected to pay providers who appear on its "News" product.

Treasurer Josh Frydenberg and Communications minister Paul Fletcher issued a joint statement, saying: "The code will ensure that news media businesses are fairly remunerated for the content they generate helping to sustain public-interest journalism in Australia."

The code will be reviewed within one year of its commencement, the statement added. 

The passage of the code developed after extensive analysis from Australia's anti-trust regulator and almost three years of public consultation may offer encouragement to countries such as Britain and Canada which are planning similar laws.