The ACCC released its 5th interim report for the Digital Platform Services Inquiry last Friday 11 November – available here.
The report is detailed and comprehensive, and we will be providing further updates and summaries as we work our way through the issues.
Very briefly however, the ACCC recommends the following to address competition concerns:
- Establishment of a new regulatory regime comprising new legally binding codes of conduct, to be applied service-by-service.
- The exact services will be subject to further consultation, but the ACCC refers to examples from the Digital Markets Act in the Eu such as:
- intermediation services
- online search engine services
- social networking services
- video-sharing platform services
- web browsers
- online advertising services
- virtual assistants
- cloud computing services, etc.
- The ACCC recommends these Codes be guided by high level principles established in legislation.
- To be subject to the new regime, platforms would need to be designated based on their market power/ importance to consumers, businesses and markets.
- The Codes would address issues such as anti-competitive self-preferencing, tying and exclusive pre-installation agreements, data advantages, fair treatment of business users, switching, interoperability and transparency.
To protect consumers and small businesses the ACCC recommends:
- New targeted obligations be applied to search, social media, online private messaging, ap stores, online retail marketplaces and digital advertising services.
- These are to address issues including:
- user-friendly processes for reporting scams, harmful apps, fake reviews, including a notice and action mechanism and public reporting on mitigation efforts
- verification of certain business users (eg advertisers, app developers) and publish review verification processes
- meet minimum internal dispute resolution standards
- A new digital platform ombuds scheme to resolve disputes
- (as it has recommended previously) a new economy-wide unfair trading practices prohibition and strengthening of the existing unfair contract term laws.
It notes that new obligations in these codes could also aim to improve consumer switching, information transparency and interoperability between different services, and to better protect business users of digital platform services.
On Ad Tech, as you may recall, the ACCC’s previous recommendations 4 and 6 from its Final Digital Advertising Services Inquiry Report (September 2021) provided:
- Recommendation 4: Industry should establish standards to require ad tech providers to publish average fees and take rates for ad tech services, and to enable full, independent verification of demand-side platform services.
- Recommendation 6: The ACCC should be given powers to develop and enforce rules to improve transparency of the price and performance of ad tech services. The rules would apply across the Australian ad tech supply chain.
In this 5th interim report, the ACCC reiterated these recommendations, noting that industry is currently implementing recommendation 4 and taking steps to address the concerns raised in recommendation 6 (broader transparency across the advertising supply chain).
It has also noted:
- that transparency obligations should only be included in an ad tech code of conduct for relevant Designated Digital Platforms if voluntary industry measures are not effective in resolving transparency issues, but that
- while the ACCC supports industry-led initiatives, any ad tech code should be able to include measures to promote transparency if industry measures are not effective.
- These obligations could address:
- Providing publishers with the ability to compare bids received from all sources in an auction (auction transparency).
- Facilitating independent assessment of the performance of its services (ad verification transparency), to enable advertisers to independently assess the quality of demand-side platform services, and so they are not required to use the demand-side platforms’ bundled systems for these verification services.
- Providing average fees and take rates for services (pricing transparency) to assist to advertisers and publishers to understand the fees and take rates that are charged at each stage of the supply chain, increasing their ability to compare the price of different ad tech services.
Next steps are not entirely clear yet but will likely be a further consultation process with Government on these recommendations. We will keep you updated.