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ACCC Calls for stronger Digital Platform Regulation to Protect Australian Consumers
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Canberra, Australia – The Australian Competition and Consumer Commission (ACCC) has released its final report from the Digital Platform Services Inquiry, urging the Australian government to implement stronger regulations for digital platforms to protect consumers and businesses from harmful practices. The five-year inquiry concluded that current laws are insufficient to address the challenges posed by dominant digital platforms [1].
Key Findings of the ACCC’s Digital Platform Services Inquiry
ACCC Chair Gina Cass-Gottlieb emphasized the critical role of digital platform services in the Australian economy, stating that while these services offer numerous benefits, they also create harms that existing laws cannot adequately address. The report calls for targeted regulation to foster competition, encourage innovation, and protect consumers in digital markets.
Did You Know? The ACCC’s Digital Platforms Branch conducted a five-year inquiry into markets for the supply of digital platform services in Australia and their impacts on competition and consumers, following a direction from the Treasurer in 2020.
The ACCC’s recommendations include:
- an economy-wide unfair trading practices prohibition.
- An external dispute resolution body for digital platform services.
- A new digital competition regime.
Continued Risks to Consumers and Small Businesses
The report highlights the ongoing risk of consumer and competition harms on digital platforms. Consumers face unfair trading practices, including manipulative design interfaces that steer them toward more expensive options. According to the ACCC, 72% of Australian consumers have encountered potentially unfair practices while shopping online.
Moreover, 82% of consumers surveyed support the creation of an independent external dispute resolution body to handle complaints against digital platforms. This body would also assist small businesses facing issues such as fake reviews or account deactivations.
A New Digital Competition Regime for australia
The ACCC has observed anti-competitive conduct by powerful digital platforms,including denying interoperability,self-preferencing,and withholding access to essential hardware,software,and data. Such practices can lead to higher prices, less choice, and reduced quality for consumers.
Pro Tip: Businesses should regularly monitor their online presence for fake reviews and be prepared to escalate issues to the platform or,eventually,to the proposed external dispute resolution body.
Several jurisdictions, including the European Union, the United Kingdom, Germany, and Japan, have already introduced regulations to improve competition in digital markets. The ACCC believes it is crucial for Australia to follow suit to increase contestability and support a growing economy.
Emerging technologies and the Need for Scrutiny
The ACCC’s report also addresses the risks associated with rapidly evolving digital markets and emerging technologies like cloud computing and generative AI. The major providers of cloud computing in Australia-Amazon, Microsoft, and Google-are vertically integrated, which could incentivize anti-competitive behavior.
Generative AI developers also require important cloud computing power, potentially leading to cloud providers self-preferencing their own AI products. this could stifle innovation and increase costs for Australian businesses and consumers.
To mitigate these risks, the ACCC emphasizes the need for ongoing monitoring of existing services and emerging technologies under the proposed digital competition regime.
Timeline of ACCC’s Digital Platform Services Inquiry
| Date | Event |
|---|---|
| 2020 | Treasurer directs ACCC to conduct a five-year inquiry into digital platform services. |
| December 2023 | Government accepts ACCC’
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