The Australian government on Monday unveiled a proposed competition scheme to introduce new laws that would allow global technology companies to be fined up to $50 million AUD for anti-competitive behavior and obstructing consumer choice.
The proposal seeks to impose broad obligations upon digital platforms through primary legislation in order to prohibit acts that involve anti-competitive self-preferencing, anti-competitive tying, impediments to consumer switching, restrictions on interoperability, unfair treatment of business users, or a lack of transparency.
Assistant Treasurer and Minister for Financial Services Stephen Jones announced in a recent media release that app stores and ad technology are likely to be the first services investigated under the proposed digital competition regime, with social media also being considered a priority. App store platforms, in particular, have been criticized for favoring their own apps in search results, undermining competitors, and engaging in anti-competitive practices such as mandating the use of their payment systems, which drives up costs for businesses and consumers while limiting choice. Highlighting the broad economic impact of these practices, Australian Competition and Conusmer Commission (ACCC) Acting Chair Catriona Lowe stated: “Companies like Google, Apple, Meta, Microsoft, and Amazon supply services that most Australians use every day. These digital platforms are often unavoidable ‘gatekeepers’ between Australian businesses and consumers, giving them huge influence across the whole economy.”
The regime proposal was established in response to findings by the ACCC in their September 2022 Digital Platform Services Inquiry Report. The ACCC determined that existing competition provisions alone were not sufficient to address current or potential future competition harms arising from the existing conduct of global technology giants. The government accepted the ACCC’s findings in 2023 and has since worked closely with the organization to develop the newly proposed regime.
The proposed regime is part of a wider effort by the Australian government to curb the influence of digital technology and social media platforms and is similar to efforts being made to prevent monopolization in the European Union, United Kingdom and Japan. Last week, the Australian government passed legislation banning residents under 16 from accessing social media platforms. The government, however, had to abandon proposed laws targeting misinformation on these platforms. The government now welcomes submissions on the proposed digital competition scheme, a move that has been welcomed by the ACCC.
