Shares in social media companies under pressure as US President Donald Trump is likely to sign an executive order on Thursday to review a law that protects Twitter (NYSE: TWTR), Facebook (NASDAQ: FB), and Alphabet’s Google (NASDAQ: GOOG) from being responsible for the material posted by their users.
The order would require the Federal Communications Commission (FCC) to clarify regulations under Section 230 of the Communications Decency Act, a federal law largely exempting online platforms from legal liability for users posts, according to Reuters, which has seen a draft document. Such a move could expose tech companies to more lawsuits.
Twitter is down 3% in premarket trading on Thursday at $32.01, Facebook slipped 1.3% at $226.36, although Google parent was largely unchanged at $1417.84.
White House officials gave no further details on what is expected in the executive order.
The move comes after Twitter added fact-check links to two of Trump’s tweets for the first time on Tuesday, including one that claimed mail-in ballots would lead to widespread voter fraud.
The President, who has more than 80 million followers on Twitter, has threatened to shut down social media platforms he accused of stifling conservative voices.
This latest episode with Twitter feeds Trump’s narrative that there are powerful forces in the media aligned against him, and that his is the only voice his supporters can trust, say observers.
“This plays right into President Trump’s hands,” Jason Miller, the communications director for Trump’s 2016 campaign and someone who has been directly involved with Trump’s social media strategy told CNN. “They basically handed him a massive gift.”
President Trump hit out at the social media giant on Tuesday over being fact-checked. He wrote: “Twitter has now shown everything we have been saying about them… is correct and vowed “big action to follow”.
But Twitter’s chief executive Jack Dorsey said: “We’ll continue to point out incorrect or disputed information about elections globally.”
Trump wrote a similar post on Facebook post about mail-in ballots on Tuesday, and no such warnings were applied.
In an interview with Fox News on Wednesday, Facebook chief executive Mark Zuckerberg said censoring a social media platform would not be the “right reflex” for a government concerned about censorship. Fox said it would play its full interview with Mr Zuckerberg on Thursday.