Crikey | 27 May 2026
US lobbyists claim plan to force Meta and Google to pay for news violates our free trade agreement. Do they have a point?
by Anton Nilsson
Two US tech lobby groups filed submissions to the Australian government last week, arguing the new policy proposal known as the news bargaining incentive should be withdrawn.
As Crikey reported, the lobbyists argued the incentive — aimed at making companies like Google and Facebook pay Australian news publishers for using their content to drive traffic on their platforms — was an unfair “tax” that would hurt the trade relationship between the US and Australia.
Both of the Washington-based lobby groups claimed the incentive would violate the US-Australia free trade agreement, signed in 2004, by discriminating against US companies. The US government has also lashed out at the policy, calling it “foreign extortion” in comments by a White House spokesperson last month.
Do they have a point?
Well, if they do, it’s not a great one, according to two experts in international trade and law.
Sydney Law School professor of comparative and private international law Jeanne Huang said that because the incentive wouldn’t apply by reference to nationality, and therefore isn’t specifically targeting only American companies, the US tech giants wouldn’t have a strong case to make.
“The bill applies by reference to service type, Australian user numbers, and Australian-attributable revenue, not by reference to nationality,” she said. “The fact that TikTok/ByteDance, a non-US supplier, would also likely be captured strengthens Australia’s defence against [that] argument.
Is the new plan to force big tech to pay for Australian news any good? We ask the experts
Is the new plan to force big tech to pay for Australian news any good? We ask the experts
Daanyal Saeed
11
“Currently, there is no evidence showing that Australia would apply the bill in an arbitrary or unjustifiable manner, constituting a disguised restriction on investment or international trade.”
Either way, it’s too early to tell whether US tech companies could end up being able to make a credible case of discrimination.
“It’s possible that the final design of the legislation could result in some indirect discrimination, but a lot depends on the final shape and nuance of the legislation,” said UNSW professor of law Lisa Toohey.
“If some indirect discrimination were to creep into the final version of the legislation, would [the US tech companies] have any recourse? The answer is yes, under the free trade agreement, there are mechanisms that the US and Australia have agreed on, to try to deal with disputes between them.”
Those mechanisms include a joint committee with representatives from both countries’ governments, as well as a formal dispute settlement process managed by the World Trade Organisation.
“If you have a disagreement about one facet of behaviour, then you can have a dispute about that and resolve it,” Toohey said. “If it went through a dispute settlement process, Australia might have to amend that legislation to bring it into conformity with what the agreement says, but free trade agreements don’t limit the ability of a country to make laws.”
When China engaged in a trade war with Australia, beginning during tensions between the two countries that were heightened by comments made by the Morrison government about the origins of the coronavirus pandemic, that fight was resolved by a combination of pressure applied through the WTO process and political overtures.
“A critical ingredient in the restoration of trade ties has been the multilateral trading system, overseen by the World Trade Organisation (WTO),” the Australian Financial Review reported in 2023. “This system, which supports open and competitive global markets, blunted the effects of Beijing’s bans by facilitating the redirection of Australian coal, barley and other commodities previously destined for China, elsewhere.”
However, as Trade Minister Don Farrell said after Australia suspended its WTO appeal shortly before the body was due to hand down a finding, Australia’s “preferred method” of resolving such disputes was “to discuss and negotiate with our trading partners”.
“On this occasion, we have sought dialogue with our Chinese counterparts to see if there’s any possibility of resolving these impediments through sensible dialogue,” Farrell said in 2023.
It’s also worth remembering that the US has been far from shy in ripping up the international trade rulebook when it suits its own interests, as President Donald Trump’s “Liberation Day” tariff move showed.
It’s safe to say that the Albanese government has baked in the potential for US blowback into its political calculations regarding the incentive. As Toohey put it: “The Australian government will be making its own risk calculations in deciding that this is important politically, and that’s a very complex and nuanced decision they’re making.”
