The Federal Treasury of Australia has revealed its first key steps in tackling anti-competitive behaviour on digital platforms such as Google, Amazon and eBay.
It comes a year after the Australian Competition & Consumer Commission (ACCC) released its recommendations in a Digital Platform Services Inquiry report.
Anti-competitive conduct identified in the report included self-preferencing - where platforms favour their own services in search results and app stores - and tying, for example with developers being forced to use app stores’ in-app payment systems that charge commissions of up to 30 per cent.
The ACCC also raised concerns around fake and misleading online reviews on digital platform services, saying they reduce the ability of consumers to make informed choices and undermine their trust in the digital economy, while causing financial and reputational damage to businesses.
In an estimate supplied by the ACCC, 4% of all online reviews are fake, impacting $900 million of spending in 2021 in Australia.
"While fake reviews are found across e-commerce sites, major general online retail marketplaces such as Amazon and eBay have been an enduring target for review manipulation," the ACCC wrote in the report.
"Fake reviews are also prevalent on social media services, including Meta’s Facebook and Instagram, and in results returned in response to Google search queries and the reviews feature on Google Maps."
The report also noted examples of unfair and arbitrary treatment of smaller businesses that rely on the platforms to reach customers.
According to the ACCC, Australian consumers and small businesses often find it hard to achieve quick and easy resolution of complaints and disputes with digital platforms. The consumer watchdog highlighted the suspension or termination of a user’s accounts, and scam content, harmful apps and fake reviews as areas where disputes can arise.
As a result, further work will be undertaken by the Treasury and the Department of Infrastructure, Transport, Regional Development, Communications and the Arts, to consider options to improve the dispute resolution processes available to users of digital platforms.
As a first step, the Government is calling on members of the digital platforms industry to develop voluntary internal dispute resolution standards by July 2024.
The ACCC also advocated for the development of a new ex ante digital competition regime to address anti‑competitive behaviours of certain digital platforms. Treasury will consult on the design of a potential ex ante digital competition framework in 2024.
According to the Treasury, this response complements other major work the Albanese Government has underway. This the launch of a National Anti-Scam Centre, where the Government is currently consulting on mandatory industry anti-scam codes.
In 2022, the Government passed laws to ban unfair contract terms, and is considering options to address unfair trading practices.
“We want Australians to have confidence that they can use digital platforms safely, and that they’ll be heard by the platform if something goes wrong,” Assistant Treasurer and Minister for Financial Services, Stephen Jones said.
“The steps we are taking here build on the work that the Albanese Government has already done to put Australian consumers and small businesses first after a decade of neglect.”
The ACCC welcomed the in-principle agreement from the Australian Government in tackling anti-competitive behaviour on digital platforms.
“Companies like Google, Apple, Meta, Microsoft and Amazon supply services that most Australians use every day,” ACCC acting chair Catriona Lowe said. “These digital platforms are often unavoidable ‘gatekeepers’ between Australian businesses and consumers, giving them huge influence across the whole economy.
“The proposed reforms will ensure fairer and more transparent treatment of small and medium-sized businesses, allowing Australians to fully realise the benefits of participating in the digital economy.
“By promoting competition in these markets, the reforms will also provide consumers more choice, higher quality services, and fairer terms and conditions.”
Lowe said the United Kingdom, Germany, Japan and the European Union have already announced or implemented significant new competition and consumer regulations for digital platforms.
“It is our experience that platforms rarely extend changes made in one jurisdiction to others, so it is critical that the Australian Government works quickly to implement these reforms so that consumers and small businesses aren’t left behind.”