Assistant US Trade Representatives Daniel Bahar and Karl Ehlers said in a submission to the Senate panel looking into the legislation that the "US Government was concerned that an attempt, through legislation, to regulate the competitive positions of specific players in a fast-evolving digital market, to the clear detriment of two US firms, may result in harmful outcomes".
"There may also be long-lasting negative consequences for US and Australian firms, as well as Australian consumers," the two American officials said.
"While the revised draft has partially addressed some US concerns — including an effort to move towards a more balanced evaluation of the value news businesses and platforms offer each other in the context of mandatory arbitration — significant issues remain."
Three concessions were given to Google and Facebook. They will be able to put a value on the service they provide to a news organisation in monetary terms — for example, Google will be able to say its search results were worth so much — before the amount that they should pay to that organisation is set.
In response to the US submission, Treasurer Josh Frydenberg said the government “is committed to proceeding with a mandatory code” that would address “the bargaining power imbalances with digital platforms and media companies".
The Senate will hold public hearings on the legislation on 22 January.