Australia passes law making Big Tech pay for local news
What's the story
Australia has passed a new law that will force major tech companies, including Meta and Google's parent company Alphabet, to pay a levy if they don't strike commercial deals with local media outlets. The legislation, called the News Bargaining Incentive, imposes a 2.5% tax on these companies' advertising revenues unless they reach agreements with Australian publishers.
Targeted companies
Who does the levy apply to?
The levy applies to companies offering a "significant" social media or search service in Australia and earning more than A$250 million ($178 million) in local advertising revenue.
If these platforms reach agreements with at least eight different publishers by the end of their reporting period, they can avoid the charge.
The value of such deals would be offset against their levy liability.
Deal requirements
Spending with large publishers carries a 150% offset
The legislation mandates that the deals should either support the production of news content or relate to news content produced by publishers being made available online by platforms.
Spending with large publishers carries a 150% offset, while spending with small and medium-sized outlets carries a 200% offset.
However, any single deal is capped at 25% of a platform's levy liability.
Government stance
'Message to platforms to pursue commercial deals is clear'
The Australian government has stressed the importance of platforms pursuing commercial deals.
"The legislation is here, and the message to platforms to pursue commercial deals is clear," it said in a statement.
The law comes just a day after parliament passed laws restricting gambling advertisements.