Google has threatened to make its search engine unavailable in Australia if the government goes ahead with plans to make tech giants pay for news content.
Australian Prime Minister Scott Morrison quickly hit back, saying “we don’t respond to threats”.
Mr Morrison’s comments came after Mel Silva, the managing director of Google Australia and New Zealand, told a Senate inquiry into the bill the new rules would be unworkable.
The mandatory code of conduct proposed by the government aims to make Google and Facebook pay Australian media companies fairly for using news content they siphon from news sites.
Ms Silva said: “If this version of the code were to become law, it would give us no real choice but to stop making Google search available in Australia.
“And that would be a bad outcome not only for us, but also for the Australian people, media diversity, and the small businesses who use our products every day.”
Ms Silva said it was willing to pay a wide and diverse group of news publishers for the value they added, but not under the rules as proposed, which included payments for links and snippets.
She said the code’s “biased arbitration model” also posed unmanageable financial and operational risks for Google and suggested a series of tweaks to the bill.
“We feel there is a workable path forward,” she said.
Like in many other countries, Google dominates internet searches in Australia, with Ms Silva telling senators about 95% of searches in the nation are done through the company.
Mr Morrison, speaking to reporters in Brisbane, said: “Australia makes our rules for things you can do in Australia.
“That’s done in our Parliament. It’s done by our government. And that’s how things work here in Australia.”
Facebook also opposes the rules and has threatened to remove news stories from its site in Australia.
Simon Milner, a Facebook vice president, said the sheer volume of deals it would have to strike would be unworkable.
The Australia Institute, an independent think tank, said politicians should stand firm against Google’s bullying.
“Google’s testimony today is part of a pattern of threatening behaviour that is chilling for anyone who values our democracy,” said Peter Lewis, the director of the institute’s Centre for Responsible Technology.