ACCC releases recommendations on digital platforms

The Australian Competition and Consumer Commission (ACCC) has reported on the outcomes of its inquiry into the impact of digital search engines, social media platforms and other digital content aggregation platforms on competition in the media and advertising services markets. The inquiry looked specifically at the impact on advertisers, media content creators and consumers.

The ACCC has made a number of recommendations that would see a tough new regulatory environment for digital platforms operating in Australia. They include:

• Merger assessment: Adding to the assessment of whether a merger will result in a substantial lessening of competition consideration of the likelihood that the acquisition will result in the removal of a potential competitor as well as the nature and significance of the assets (including data and technology) being acquired. This is intended to address concerns about acquisitions in fast moving and evolving markets with dominant players and that involve data as a key asset.
• Merger notification: A protocol for advance notification to the ACCC by the large digital platforms of proposed acquisitions, given the lack of a compulsory merger filing obligation in Australia.
• Competition in search services: Users of Android devices to be permitted to choose their default search engine and internet browser from a number of options to facilitate competition in the supply of search services.
• Digital platforms branch: The establishment of a specialist digital platforms branch within the ACCC to proactively investigate, monitor and enforce issues in digital platforms markets, and specifically to inquire into competition for the supply of advertising technology services and online advertising services by advertising and media agencies.
• Oversight of content production and delivery: Development of a new platform-neutral regulatory framework to oversee entities involved in content production and delivery in Australia, including media businesses, publishers, broadcasters and digital platforms, to promote competition in the media and advertising markets.
• Digital platforms—news media code of conduct: Designated digital platforms to implement a code of conduct governing their relationships with news media businesses, going in particular to matters such as data sharing with news media, the ranking or display of news content, preserving news media’s ability to monetise its content, and sharing revenue from news media content.
• Take-down code: A mandatory Australian Communications and Media Authority (ACMA) take-down code to assist copyright enforcement on digital platforms, ensuring the effective and timely removal of protected content from digital platforms.  
• Dealing with “fake news”: A raft of recommendations in relation to broadcasting aimed at promoting access to quality news and addressing concerns about “fake news”, including:
  • addressing the stability and adequacy of funding to the public broadcasters, grants to support production of original local and regional journalism
  • adjustment to tax setting to promote production of public interest journalism
  • establishing a program to improve digital media literacy in the community
  • monitoring digital platforms’ initiatives to enable identification of the reliability, trustworthiness and source of news content, and
  • creating an industry code for handling complaints about disinformation in relation to news and journalism on digital platforms.
• Privacy: Various recommendations in the privacy space, in particular including strengthening the protections in the Privacy Act 1988 as it relates to digital platforms and the digital economy, and introducing a statutory tort for serious invasions of privacy inadequately protected by the Privacy Act.
• Unfair contract terms and unfair trading practices: Making unfair contract terms prohibited (rather than merely voidable) so that contraventions will attract civil pecuniary penalties, and prohibiting “unfair trading practices”. We await the outcome of the review by Consumer Affairs Australia and New Zealand.
• Dispute resolution standards: Developing minimum internal dispute resolution standards for all digital platforms operating in Australia, administered through ACMA.
• Digital platforms ombudsman: Establishing an ombudsman scheme for complaints about, and disputes with, digital platform providers, including giving the ombudsman power to compel production of information, make binding decisions and order compensation.

The ACCC has also confirmed its continued investigations into alleged conduct by digital platforms in contravention of the Competition and Consumer Act 2010, in particular mentioning investigations into access restrictions and representations to consumers about location data, privacy policies and data collection. These investigations are expected to be completed within the year.

Given the dramatic and continuing growth in digital platforms, the frequency with which Australian consumers interact with them and the substantial market power held by the biggest operators, it is not surprising that they have come within the ACCC’s sights. It remains to be seen to what extent, and in what form, the government will take up the ACCC’s recommendations. 

We look forward to providing an update on the outcomes of the ACCC’s digital platforms inquiry with our next issue of Consumer Matters later this year.