White House warns Australia over social media algorithm rules carrying A$109M fines

The White House has warned Australia over draft laws that would force social media platforms to offer users a feed not built by an algorithm, placing the bill in the same category as digital services taxes and describing penalties on American technology companies as a form of extortion.

The Trump administration intends to raise the legislation with Canberra, the Guardian reported today.

Kush Desai, a White House spokesperson, told Cyber Daily:

“President Trump has unequivocally warned trading partners against imposing digital services taxes, fines, and other forms of extortion on America’s leading technology sector”, adding that the administration remained committed to raising the issues with trading partners.

Anika Wells, the communications minister, said she had not received the concerns directly and would not accept the framing.

“I wouldn’t characterise that statement as (calling the regulations extortion) whatsoever,” she told The New Daily.

She also said Australia was a sovereign nation with the right to defend its parents and children.

The draft Digital Duty of Care bill, released on Tuesday, would require platforms to repeatedly prompt users to switch off algorithmic ranking rather than merely allowing them to.

We have covered the proposal when it was published. Breaches would carry penalties above A$109M, and the obligations extend past social feeds to games, apps and AI chatbots. The word that matters in Desai’s statement is fines, as Washington is not objecting to the idea that users should be able to turn off a recommendation engine.

It is objecting to a penalty regime that lands on American companies, and it is filing that objection alongside taxes, which are unambiguously trade instruments. Platform design has just been reclassified as a trade issue, and that reclassification does not stop at Australia.

Europe should read it that way. Article 38 of the Digital Services Act already requires very large platforms to provide at least one recommender option not based on profiling.

Australia has taken that right and added the part Brussels left out, which is an obligation to put it in front of people. The DSA is the largest platform-design regime in the world and carries fines of up to 6% of global turnover.

If penalties on platform design are extortion, Australia is not the target. It is the cheaper place to establish the precedent.

That reading is consistent with what has already happened. Trump has threatened 100% tariffs over digital services taxes, US lawmakers have pressed for a probe into EU tech rules, and the tech provisions of the Turnberry agreement remain the unresolved part of that deal. Australia has now been added to a list it was already close to joining.

It is the second American objection to Australian technology regulation in under a month, following criticism of a levy on platforms that do not pay for news. Canberra has been here before

. The news media bargaining code produced a standoff with Meta in 2021, and a threat from Washington that trade consequences would follow, and the code passed anyway.

Whether the bill is worth the fight is a separate question, and Australian researchers are not unanimous. Rashina Hoda, a professor in Monash University’s department of software systems and cyber security, called the move long overdue but pointed out that opt-out and opt-in are vastly different control settings, and that inertia favours whichever one is the default.

Steven Roberts, a professor in the university’s school of social sciences, said the value of the approach is that it restores user control without removing any content, which is the answer to the censorship objection domestic critics have raised.

Anthony Albanese is expected to discuss the reforms at the United Nations and may meet Trump. On the evidence of the last five years, the interesting question is not whether Australia backs down.

It is whether the bill survives the consultation period in a shape that still requires the prompt, because the prompt is the only part of it that platforms have any reason to fight.