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Australia Competition and Consumer Commission Recommendations

There have been vast changes in the digital sector over the past 15 years which has affected both the customers and the businesses. The ACCC report on digital platforms emphasizes the effect of a digital platform on business and customers and how to disseminate their content. The two main digital platforms Affecting the Australian Customers are – Google and Facebook.

On the 4th of December 2019, the Treasurer at that time, the HON Scott Morrison MP, issued directions to the Australian Competition & Consumer Commission ( ACCC) to conduct research on digital Platforms and to come to an analysis that what effect does digital search engines, social Media Platforms such as Facebook and Twitter have on competition in the marketing sector. The ACCC chairman felt the adverse effect of the market dominance of Google and Facebook. On the 10th of December 2018, the Primary report was issued by ACCC in this regard and the final report was published on 26th July 2019.[1] The ACCC 2010 stated 60 Statutory Notices u/s 95Zl of the Competition and Consumer Act 2010. The research emphasized on three sectors – Online search engines, Social media platforms like Facebook, and Digital Content. As per the summary, there are 23 recommendations made to treat the Australian customers fairly and the privacy is respected. They provide the guidelines for the change in the law so that the customers are treated fairly and the Data and the privacy of the customers are protected. The guidelines were issued in June 2019 and the final report was published on 26th July 2019. As per the recommendations the consumers are protected and Google and Facebook should not break Competition laws. The Recommendation which the government accepted is that there should be a specialized body to monitor and enforce the issues of monopoly power and prevents privacy and breaches of Privacy Law.[2] At the time when the report was released the government came to a conclusion that in order to protect the consumers from the high cost advertising , to improve transparency among the consumers and the marketers , to balance the power imbalances and to create a substantial market with fair and lea competition in the advertising and the services markets , the recommendations that are made need to become applicable by the action of the Federal Government .

Recommendation 1 of the ACCC recommendations specifies that section 50(3) of the Competition Consumer Act 2010 (ACA) Should be amended to remove a potential Competitor and the assets can be directly acquired including data and technology. section 50(3) of the ACA act states that the time when an acquisition takes place into the market 

between two corporations the following- g factors must be considered :

  • The current level of competition in the market;
  • What are the different obstacles in the market ;
  • the number of different competitors in the market which is prevailing;
  • the number of substitutes that are available in the market ;
  • what will be the effect of the acquisition in the market?

Therefore this recommendation made by ACCC ensured that when there is an acquisition in the market between two companies, the merger should not remove the potential of completion in the market. Each and every organization should be given an equal chance to compete in the market, there should be no monopoly and the asset should be directly occupied by the owner and not the subsidiaries. Therefore this recommendation was made to secure fair competition in the market.

Section 46A of CCA states that a corporation must not take an Advantage of its Position in the Market .Recommendation 2 of the ACCC Specifies that if there is an acquisition between two large online enterprises, the ACC should be served with an advance notice which specified the type of acquisitions that needs notification and what is the minimum advance notice period that should be given for the ACCC to access the acquisition. This will enable the ACCC to get a fair idea that which companies are into acquisition, what will be the effect of the merger in the market, whether it will be a fair competition to the other marketers or not. Therefore this recommendation emphasized on the betterment of the market in Australia, in order to promote a fair completion between Different organizations. After looking to the Notice, ACCC makes a further recommendation to the government to act in this issue.

Recommendation 3 The ACCC main reason for investigation was the conduct and the Application of Certain digital platforms under the Competition and Consumer Act2010. ACCC final report states that there should be Changes given in the search engines similar to those that are prevailing in the other countries. This recommendation implies that other competitors in the market should be given an equal and fair chance to compete. Digital platforms like Google and Facebook should not take an advantage of their monopoly position in the market and give a fair chance to other competitors in the market. The report also emphasizes on the effect of the two leading Digital Platforms in the Advertising marking and the issues that cover the presence of these platforms at the different levels of the advertising chain. Eight different types of Online Advertising are as follows:-

  • Display Advertising;
  • Search Engine Marketing ( SEM ) and optimization ( SEM ) & (SEO) ;
  • Social Media – Facebook and YouTube;
  • Native Advertising/ Blogs ;
  • PPC- Pay Per Click ;
  • Affiliate Marketing ;
  • Remarking and ;

Video Ads that generally Pop up at the beginning of a Video. [3] The following diagram shows the impact of Social media, that is how the different Marketers use Social Media to compete and the importance of Digital platforms in marketing:-

Recommendation 4 of the report specifies that there should be a proper and a proactive investigation in the monitoring and the application of the issues in the market in which the Digital Platforms Operate . The issues in which the market perform are –

  • New Regulatory Constrains which states that more attention should go towards the customers, matching their needs and to ensure data transparency.
  • Growth Pressures – Marketers are constantly looking for the platforms that are underdeveloped and how that they be improved . For example Amazon included the option of Groceries in order to compete in the market with the other monopolistic Platforms.
  • A change from B2C ( Business to Consumers ) to Enterprise Markets – Most Digital Platforms built AL and ML capabilities in order to create interest for the new business Opportunities and ;
  • Technology changes continue to shape the platform and increase competition in the market .[5]

Therefore , regulation 4 specifies that there should be a Proper Authority who should look towards the factors that are impacting the marketers and a proper monitoring and investigation should but done in order to promote fair market and Data Transparency .The final report that is being issued only focuses on the imbalance between media , business and the digital platforms and specifies that there should eb a proper chain of communication followed up.

Recommendation 8 of the ACCC final Report on the Digital Platform States that there should be a mandatory and a proper ACMA ( Australia Communications and Media Authority )takedown code to prevent copyright issues and enforcement in Digital Platforms. A mandatory industry code is made applicable to govern the control or regulate Digital Platform Operating in Australia. Codes are defined as a set of codes that protest consumers and help the market perform and operate in a transparent way. Copyright owners will have the right to information about their infringement and will get a series of escalating notices from the ISP. As per Section 4.2 of the INDUSTRY CODE C653:2015, COPYRIGHT NOTICE SCHEME states that it Is the responsibility of the Copyright information panel to report interested persons, Holders, ISP’s, Consumers, the Federal Government, the office of ACMA in the operating.[6] But, the ACC in its final report has stated that it should not only be the responsibility there Should be a proper code in ACMA to prevent Copyright issues. Copyright infringement is a matter of great concern therefore, effective steps should be taken by the government in order to protect the marketers and the Digital Platforms like Google and Facebook from infringing the copyright of the other business and marketers.

The report also specifies the importance of funding in the News and Journalism sector in order to improve the quality and the quality of the news being supplied to the consumers.

Recommendation 9 of the ACCC states that there should be a proper, stable, and adequate funding for the public broadcasters to ensure the quality of the news delivered between the consumers. To protect the media and to help them, more than 100 regional newspaper publishers and broadcasters across Australia will be getting funding the Federal Government. Since Google and Facebook have acquired a dominant position in the marketing sector, so the marketers opt for Digital Platforms to acquire a dominant position among the other competitors. Therefore ACCC specifies that the government should provide adequate funding to the newspapers and the other broadcasting services in order to ensure that the quality of the news that is delivered is Stable and the broadcasters and the local and the regional newspapers face no Burden. Digital platforms have no right to use their Dominant Position and affect the other competitors. There should be no financial burdens on the other broadcasting and the news services.

Recommendation 10 of the ACCC Digital Report Covers Grants for Local Journalism. In April the Federal Government had made an announcement that $50 million fund will be provided as due to the pandemic the growth of local and regional newspapers have come extensively low . The fund comprises of new funds combined with the repurposed funds in order to support high quality news in Australia.[7]

The Recommendation states that when it comes to Regional and small promoters they should be provided with grants program in the place of innovation package , that promotes local and regional journalism covering local courts as well as the journaling related to local Government affairs and policy. The government should also review the program once in every three years to look up at the effectiveness and to ensure that if there are any changes that needs to be made , they are done effectively and efficiently . The review also takes place in order to determine that whether the program should be expanded more or to the other areas of Public interest and under provision by the Australian Commercial Media Market. Moreover the funds not only provides grants to local and regional newspapers but also to five TV and Thirteen radio Stations , and 92 newspapers in addition with the local and regional newspaper. Due to the inadequate amounts of fins , the regional news and the small towns are not covered at the time of Public health crisis which the major media companies do not want to cover. Therefore grants should be allocated so that the small advertising marketers and companies also sustain in the society.

Recommendation 11 of the ACCC Digital Platform Report covers Tax settings. It states the tax laws that are prevailing in the State of Australia, the changes or the amendments should be made in such a way to form new categories of charitable purpose and DGR in order to increase the Production of PIJ ( Public Interest journalism ) . PIJI ( Public Interest Journalism Initiative ) Chairman Mr. Allan Fels stated that regional media and local newspapers are on the verge of crisis and it’s the duty of the government to take necessary steps in order to reduce the crisis of regional media and local newspapers.[8] When Parliamentary concerns raised ACCC inquiry into digital Platforms, it came across the Australian Government is working hard in the area of Digital Disruption. Digital disruption has the power to affect and it can even destroy Industries. Suburbs and 45% of regional areas have experienced a decline in Journalism. Therefore a tax- based initiative needs to take place in order to promote local and regional Journalism. the public are willing to pay $380 million and $740m a year for Public Interest Journalism funding that would bring a tremendous change in the whole sector.[9] The future of Journalism mainly focuses on supply and side questions, and to keep in mind that why people are not buying or reading news and whey they are in a position to pay for High – Quality Journalism.

Recommendation 12 of the Report of ACCC Digital Platforms report states that there should be an improvement in digital media in the Community. People Should be made more aware of Digital media. Various types of online and offline programs should be run by the Government in order to educate and make people more and more aware of Digital Platforms. The resources and the training should be provided at Community Centres, Schools, Libraries, Local Educational centres, and Senior Centres for the Benefit of Australian Citizens.

ACCC Conducted an investigation where amendments mere made in the Completion and Consumers Act , for the application of fair market in the society .Recommendation 15 of the ACCC Digital platform report states that there should be a proper set of codes for Digital Platforms in Order to Counter Disinformation. Since there are an ample number of people using Digital Platforms for different types of purposes and work so there should be a proper and a Definite Set of Codes to handle complaints that are related to disinformation and related to news and journalism. Moreover, the code should be also be regulated and enforced by an Independent authority so that the codes can be applied freely without any sort of interference, if the code if not submitted to a regulator within Nine months then it is the duty and the responsibility the Regulator to introduce a mandatory Digital Platform industry Standards. The codes should be regularly reviewed by the regulator once in every two years and recommendations should be made in accordance with the review and whether amendments are required or not.

The ACCC report of Digital Platform has made in total 27 Recommendations in relation to the Australia Competition and Consumers Act 2010 to regulate various issues in the field of Digital Advertising and Journalism so that the Leading Digital Platforms such as Google and Facebook do not use their dominant position in the market, creating a Monopolistic Market. It also focuses on creating a fair and transparent market for the marketers and competitors in order to prevent digital platforms from using their monopolistic approach. The recommendations also majorly focused on the steps that can be taken in order to promote the growth of Regional Newspapers and Local Newspapers so the local and the regional news can be covered and the quality of the news which is delivered ais also for better quality. An adequate amount of funds and grants are also distributed amount the local and regional advertising companies in order to encourage them, motivate them, and bring them out from the loophole of the Financial Crisis. New Policies related to tax policies are also implemented, the Dominant digital platforms are restricted from doing certain actions so that they cannot take advantage of their position and do not dominate the medium and small scale advertising agencies. Therefore, the whole motive of the report and the 27 recommendations made were for the small scale, medium, regional, local newspaper and advertising companies, to promote them and motivate them to perform their functions, giving financial assistance and restricting the Highly demanded Digital Platforms like Google and Facebook to use their Dominant position in the society.

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