Technology

The Australian treasurer says discussions with Facebook about the new media law have been “lengthy and difficult”.

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In this photo illustration, the Facebook and Google logos can be seen on a smartphone in front of an Australian flag.

Pavlo Gonchar | SOPA pictures | LightRocket via Getty Images

Australian treasurer Josh Frydenberg told CNBC that negotiations with Facebook over the country’s new media law were “quite lengthy and difficult”. but both sides have finally managed to resolve their differences.

The Australian Parliament last week passed a law requiring companies like Facebook and Google to pay media and publishers to link their content in news feeds or search results.

Before the bill was passed, Facebook banned Australian users from viewing and sharing news content on its platform in retaliation against the proposed bill. The Australian government criticized the move, which Facebook later reversed after the two sides reached an agreement.

“Well, there have been challenging negotiations,” Frydenberg told CNBC’s Will Koulouris on Wednesday.

“Obviously, we on Facebook were deeply disappointed with their actions to remove Australian news from their website … but since then we’ve been on the phone, working through our differences and, I believe, reaching an amicable position,” he said.

Things are moving in the right direction, although this has been a rather lengthy and difficult series of negotiations.

Josh Frydenberg

Australian treasurer

The negotiations resulted in the Australian government introducing last-minute changes to the bill – officially known as the Mandatory Code of Negotiation for News Media and Digital Platforms – before it was passed.

“Facebook is currently negotiating in good faith with Australian news media companies,” said Frydenberg. He cited the letter of intent from Seven West Media, which owns the Seven broadcast network, to make news content available to Facebook.

“Things are moving in the right direction, although this has been a rather lengthy and difficult series of negotiations,” said the treasurer.

Facebook’s response to the media code has often been compared to Google’s reaction.

Google also pushed back heavily, threatening to pull its search function out of the country – but eventually the company relented and signed deals with multiple media outlets, including Seven West Media and the family-owned News Corp. by Murdoch.

Frydenberg said there was “no doubt” that other countries were watching developments related to Australia’s new media law.

The passage of the bill made Australia the first country where a government-appointed arbitrator can decide the final price that digital platforms will have to pay news publishers if a commercial deal cannot be independently reached.

Countries like France have taken some measures to make tech companies pay for news, while others like Canada and the UK are considering their next steps.

– CNBC’s Saheli Roy Choudhury contributed to this report.

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Katherine Clark