ACCC boss Rod Sims lays down law on Facebook and Google, says Australia can act alone

Rod Sims has warned Google and Facebook to either abide by the law or leave our shores.

Head of the ACCC Rod Sims in his Sydney office. John Feder/The Australian

Australia’s competition boss Rod Sims has warned tech giants Google and Facebook to either abide by our laws or leave our shores.

Mr Sims, who led a landmark regulatory investigation into digital platforms over 19 months that uncovered many “adverse effects” associated with the tech giants, said “Australia can, if necessary, act alone” with its crackdown.

“Facebook and Google are clearly subject to our laws. They either comply or do not do business in Australia,” Mr Sims said in a speech to the Melbourne Press Club.

In the past, the tech giants have threatened to withdraw services from a country in response to local laws, but Mr Sims does not think that will happen here.

“Not only are our measures carefully calibrated, but we are closely in touch with our overseas counterparts who are sympathetic to both the issues we have raised, and our solutions,” he said.

Some tech executives have argued that increasing regulation in digital markets will stifle innovation, which Mr Sims dismissed.

“This fails to recognise that while digital innovations have the potential to transform societies for the better, there are also forms of innovation that can be harmful or corrosive; as fake news and the promotion of extremist content online illustrates.

“Thoughtful regulatory frameworks can help us harness the benefits of innovation while protecting society from its potential harms,” he said.

Mr Sims said the tech giant’s might won’t deter Australia’s crack down.

“Do not underestimate the power of what we have recommended to be put in place now.

“First, taking the digital platforms to court here or overseas lays down rules within which they must work. These are more important than the level of penalties. Once found to breach a law, it will be very difficult for a digital platform to continue with that behaviour in any effective way,” he said.

Great talk by @acccgovau Chairman Rod Sims to the @MelbPressClub on Google, Facebook and the future of journalism. Thanks to @Channel9 CEO Hugh Marks & @AAPNewswire CEO Bruce Davidson for coming along! pic.twitter.com/dwbBPjfhqp

— Michael Rowland (@mjrowland68) August 13, 2019

The Australian Competition & Consumer Commission’s landmark 600-plus page report, which was released by the Australian government last month, listed 23 recommendations, including a specialist digital platforms branch within the regulator to investigate, monitor and enforce, changes to the merger law to take account of data being acquired, and also to give advance notice of acquisitions by tech giants that might affect competition in Australia.

“The codes we have recommended are, and must be, binding, legally enforceable and with meaningful penalties for breaching them. Otherwise I agree they will be of little use,” Mr Sims said.

The ACCC’s digital platform inquiry found that Google and Facebook have “substantial market power” in several markets, which requires greater scrutiny.

“As Google and Facebook grow and expand into adjacent markets, they increasingly have the incentive and ability to favour their own businesses; so there are clearly competition issues that need to be addressed.

“There are also consumer issues surrounding digital platforms that concern us; about what Australians know, how well informed they are, whether they are being misled about the use of their data, or whether it is being misused,” Mr Sims said.

Mr Sims raised concerns about the tech giant’s impact on the media industry, noting that “many media businesses are now reliant on digital platforms, particularly Google, for referrals to their websites.”

“It is because of their role as the gateways to Australian consumers that media businesses have legitimate concerns with their practices,” he said.