Australia’s competition and consumer regulator has called for sweeping changes to the regulation of digital platforms after warning for years about anti-competitive behaviour and a lack of user protections from tech giants.
On Friday, the Australian Competition and Consumer Commission (ACCC) publicly released the recommendations it gave the Treasurer in September, outlining its plan for new consumer protection laws and enforceable service-specific codes of conduct.
The laws and codes have been developed specifically to address concerns around large digital platforms operated by the likes of Meta, Google, Amazon and Apple, and would target scams, fake reviews, harmful apps, and competition barriers like self-preferencing, opacity and poor interoperability.
The new laws targeted at platforms would establish better scam reporting, introduce mandatory dispute resolution processes supported by a new digital platform ombudsman scheme, a requirement to verify certain business users such as advertisers, app developers and merchants, and require the disclosure of how reviews are verified.
Additional competition measures would come through enforceable, service specific codes of conduct. The codes would be developed by regulators and aimed at stopping the anti-competitive self-preferencing, tying and exclusive pre-installation arrangements. Platform giants have been fined for such practices in Europe and the ACCC is concerned about similar practices in Australia.
The codes would also address consumer switching barriers and data portability, provide more transparency for market participants, particularly the online advertising third parties working with platforms, and improve interoperability by requiring platforms to improve access to their hardware software and systems.
The codes of conduct would only apply to designated platforms – those deemed by the government to have the ability and incentive to harm competition. But similar to the ACCC developed News Media Bargaining Code, the mere threat of the code of conduct could force changes from the global giants.
“Our analysis has identified concerning consumer and competition harms across a range of digital platform services that are widespread, entrenched, and systemic,” ACCC chair Gina Cass-Gottlieb said.
“The critical positions that digital platforms hold, as ‘gatekeepers’ or ‘intermediaries’ between businesses and consumers, mean they have a broad influence across the economy, making the reforms we are recommending crucial and necessary for all Australians.”
The ACCC is also recommending targeted competition obligations based on existing legislated principles and a new economy-wide unfair trading practices prohibition.
For the regulator’s recommended changes to come into effect the Parliament will need to introduce new legislation. Regulators would develop the specific codes of conduct which would be applied to platforms when designated by the government, likely through the Treasurer.
The Albanese government welcomed the ACCC’s proposition on Friday and flagged further public consultations on any response, meaning it could take years for the laws and codes to come into effect.
The ACCC has been closely monitoring digital platforms for half a decade, with a landmark 2019 Digital Platforms Inquiry setting up ongoing scrutiny through a dedicated digital platforms branch at the regulator.
The watchdog has used a series of interim reports to probe areas like messaging services, apps, browsers and search, marketplaces, and digital advertising. The next interim report is focusing on social media.
Based on these reports, the ACCC delivered recommendations for new platform regulation to Treasurer Jim Chalmers in September. The report was released by the ACCC on Friday.
The government said it will consider the recommendations and will consult publicly to seek the views of stakeholders “as part of its efforts to ensure Australia has the right regulations in place to be a leading digital economy”.
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