Facebook, Google, Yahoo and eBay have written to the government expressing "grave concerns" about the Digital Economy Bill.
The bill, which had its second reading in the House of Commons today, provides a legal framework for tackling copyright infringement. The companies say some of it goes too far.
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They have particular problems with clause 17, which could give the secretary of state unprecedented powers to amend the Copyright, Design and Patent Act in the future. The companies are urging the government to remove the clause.
The letter says, "We believe the bill's clause 17 opens the way for arbitrary measures. This power could be used, for example, to introduce additional technical measures or increase monitoring of user data even where no illegal practice has taken place." This would discourage innovation and impose unnecessary costs, it adds.
The clause is so wide, they say, that it could put legitimate use of the internet at risk.
The Department for Business, Innovation and Skills says clause 17 will help the government deal with new methods of copyright infringement, which will develop as technology evolves.
But Facebook, Google, Yahoo and eBay say it could cause difficulties for entrepreneurs seeking solutions to the current business model problems surrounding creative content on the internet.
"We all acknowledge that new business models need to emerge to support creative content. They are inherently risky and entrepreneurs rely heavily on there being a consistent and stable approach to copyright enforcement. This clause would inject an unprecedented level of uncertainty in this regard."