The Australian government has lashed Facebook and Google for threatening to remove services in response to the proposed media code, accusing the platform giants of “shifting goalposts” on the weekend.

The response suggests the government may be willing to call the bluff of the tech giants which have threatened to pull search and news services from millions of Australian users.

The proposed news media bargaining code will force Facebook and Google to pay Australian publishers for the news content shared by the platforms, either by negotiating deals with publishers or through arbitration as a last resort.

Representatives from the tech giants appeared before a Senate hearing for the proposed legislation to enable the code on Friday, escalating their arguments against it with threats to remove core functions from their platforms for Australian users.

At the same hearing, major commercial news publishers supported the code, claiming without it effective negotiations with the tech giants – which they say now operate as “unregulated monopolies” – had been nearly impossible.

Google was recently found to be conducting an “experiment” to remove Australian news publishers from search results, which media outlets say demonstrated their “extraordinary power”.

‘We don’t respond to threats’

Over the weekend, the coalition government weighed in, setting up a potential game of chicken with the tech giants over the world first code.

In response to Google and Facebook’s respective claims they would no longer be able to offer search or news content to Australian users, the Prime Minister, Scott Morrison said “we don’t respond to threats”.

By Sunday Treasure Josh Frydenberg had doubled down, calling a doorstop to tell reporters Facebook and Google’s threats in response to the code do them a “big disservice”.

Frydenberg, whose Treasury department woked with the competition regulator to develop the code, said Facebook and Google are now shifting their arguments to avoid the code altogether.

“It seems digital giants keep changing the goalposts,” Frydenberg said. “They were originally against what we were putting forward on algorithms and against what we were putting forward on a final arbitration model. Now, it seems they are against paying for any clicks on a search.

The Treasurer said it was inevitable that the tech giants would pay for news content in Australia

“My view is that it is inevitable that the digital giants will be paying for original content,” he said. “We are now in a position to implement a world-leading code – one that is fair, taking into account mutual value exchange … and we think it is a fair outcome.”

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