Competition boss Rod Sims warns Australia must act to thwart tech takeovers

Competition tsar Rod Sims has warned Australia will be left behind if the government does not give it fresh powers to block mergers and acquisitions involving tech titans as its global counterparts unite behind the proposal.

Following an 18 month inquiry into digital platforms such as Google and Facebook, the Australian Competition and Consumer Commission has asked for new laws allowing it to block tech giants from buying startups, if the acquisition risks thwarting a potential competitor from being created.

ACCC chairman Rod Sims.Credit: Eamon Gallagher

The digital giants have opposed additional oversight of their future merger plans as potentially damaging to the Australian tech sector.

Mr Sims told The Sydney Morning Herald and The Age that when he convened a meeting in New York in September of about eight global competition regulatory bodies to talk about common approaches "everybody was keen to do that".

He said, in particular, that there was broad agreement among the global regulators that there needed to be additional oversight on mergers built into legislation.

If Australia doesn't act on that everybody else will be, so we'll be left behind. [There's] absolutely uniformity on that.

ACCC chair Rod Sims

The merger recommendation was the first of a string of proposals made by the ACCC to the government after its 18 month investigation, which specifically asked for competition laws to be amended to consider the "nature and significance of assets" such as data and technology when determining whether a merger or takeover can take place.

"The recommendation we have about making sure when you're assessing whether there's a substantial lessening of competition and therefore a potential breach of the merger laws that you take into account potential competition and you take into account data ... I think there's complete agreement on that," Mr Sims said.

"If Australia doesn't act on that everybody else will be, so we'll be left behind. [There's] absolutely uniformity on that."

The other change Mr Sims said there was already global alignment around was "unfair practices" which most other countries have a law against.

"There's unfair practices laws in the US, Europe, Canada, Singapore ... but there's no law here," he said.

While the ACCC does not regulate privacy issues, which fall under the Office of the Australian Information Commissioner, Mr Sims said there were clear concerns around consumers being fully aware of what they were signing up for when using services online.

"I don't think people are well-informed about what's happening to their data. I don't think privacy policies do anything other than confuse people and ... if you want to use Facebook and Google you've got no choice," he said.

"So I think the traditional model of being informed and having choice is probably getting overtaken and we're not the experts of where privacy law should go but what we are saying is we can already see that people aren't well-informed, they're probably misinformed, and they can't exercise valid choice."

While he could see merit in global alignment on privacy, something Facebook founder Mark Zuckerberg has himself called for, Mr Sims said that Europe was still learning as it went along with the General Data Protection Regulation and working through the issue of what counts as a legitimate use of data.

"That means as the government looks to Europe, to the extent that they do, they'll have to wrestle with that issue as well. It's all very new."