Lack of transparency and choice
The ACCC has noted the potential privacy risks for consumers arising from the large amounts of data held by digital platform providers, as well as potential risks relating to scams and business harms arising from fake reviews.
Harms observed by the ACCC
The ACCC identified that there is a lack of transparency for consumers in relation to how their data will be handled by digital platform providers. It noted there are few comparable alternative services and that consumers can be subject to social pressures to join these platforms and accept otherwise undesirable terms of use presented on a 'take-it-or-leave-it' basis. The ACCC also noted that the use of dark patterns and other interface design strategies can affect transparency and discourage consumers from exercising their preferences in how their information is handled.
ACCC's recommendation
The ACCC considered that additional disclosure measures for digital platform providers may be required, including in relation to ad tech. The ACCC identified various options for reform, including data portability rights to allow consumers access to their own data and data use limitations that could be imposed on digital platform providers. Any such rights would need to be counterbalanced with appropriate privacy and security measures.
The ACCC noted that any measures to safeguard consumers’ privacy should not be considered for inclusion in any proposed code until after the introduction of any privacy law reforms that result from the review of the Privacy Act that is currently being undertaken by the Attorney-General's Department. The Attorney-General has indicated that the current review of the Privacy Act should result in proposed amendments being introduced to Parliament in the first half of 2023, following a comprehensive public consultation process.
Potential implications
The ACCC's focus on transparency is consistent with recent court action it has taken against Google. Acknowledging that the current Privacy Act review may cut across these issues (and awaiting the outcome of that review) reflects a sensible approach by the ACCC, particularly in light of recent developments relating to data breaches affecting Optus and Medibank and subsequent calls for greater privacy law reform.
Scams, harmful apps and fake reviews
Harms observed by the ACCC
The ACCC noted that digital platforms present an efficient opportunity for unscrupulous actors to target Australian consumers and businesses, including via scams and other fraudulent activity, using harmful apps or submitting fake reviews.
ACCC's recommendation
The ACCC has recommended the introduction of targeted measures to protect users of digital platforms, which would apply to all relevant digital platform services. These measures include:
- mandatory processes to prevent and remove scams and fake reviews;
- mandatory internal dispute resolution standards; and
- ensuring consumers and small businesses have access to an independent external ombuds scheme.
The ACCC considers that these measures would be most effective if introduced into primary legislation and separated from existing competition measures. The ACCC has also outlined alternative options for regulatory approaches.
Potential implications
The ACCC considers that the harm caused by scams and fake or manipulated reviews is growing, and that digital platforms are insufficiently incentivised to address these issues.
It considers that the mandatory measures outlined above are warranted to adequately protect consumers and businesses across digital platforms, given the severity of the issues and harms which are occurring.
Excessive user-data tracking
Harms observed by the ACCC
The ACCC has identified that digital platforms engage in a high degree of tracking of users (including the collection, use and disclosure of significant amounts of personal information of consumers) and are then able to leverage this data in various ways, including to display targeted advertisements to consumers. While the ACCC noted that data-access rights for third parties could promote competition in the ad tech sector and remove barriers to entry, it considered that access to personal information as a result of such a data-access regime could raise significant privacy concerns.
ACCC's recommendation
The ACCC acknowledges that there are likely to be tensions between achieving the benefits of increased competition while protecting the privacy and security of consumers' personal information. It has noted that further consideration of these issues may be appropriate after the introduction of any privacy law reforms that result from the review of the Privacy Act that is currently being undertaken by the Attorney-General's Department.
Potential implications
The ACCC appears to be adopting a 'wait and see' approach to determine whether the proposed Privacy Act reforms go far enough to address the identified consumer harms, including to consider how any reforms may affect other issues identified by the ACCC in relation to counter-balancing interests in promoting competition in the ad tech sector. It may be that the ACCC will propose additional and more targeted approaches to address specific concerns after the Privacy Act reforms are passed.