Digital giants to feel watchdog’s bite

ACCC chairman Rod Sims has promised his proposed code of conduct will have ‘real teeth’.

ACCC chairman Rod Sims prepares to brief the media on his plan to rein in digital platforms.

The nation’s competition boss has warned Facebook and Google a proposed “code of conduct” will have “enormous teeth” — dismissing concerns regulators won’t be tough enough to hold the digital giants to account.

Following the release of the ACCC’s landmark 613-page report into digital platforms and their effect on traditional media, chairman Rod Sims said he had no doubt platform providers should be treated like publishers.

“In many ways they are publishers and we have to make sure we break that distinction that’s been there before,” Mr Sims told Sky News’ Business Weekend.

“Really, you should have Google and Facebook being subject to … the same laws that apply to traditional media. Otherwise it’s simply an unfair playing field.”

The report recommends a “code of conduct” for the likes of Google and Facebook and traditional media to govern revenue-sharing, competition and fair use of journalism, governed by media regulator ACMA.

Mr Sims dismissed criticism that too many of the report’s 22 recommendations relied on “codes”, saying the media code would have “enormous teeth”.

“The trouble with codes of conduct being used as a term is sometimes we’ve got codes that are voluntary, unenforceable or you can enforce them but there’s no penalty,” Mr Sims said.

“The code we’ve got in mind here is completely the opposite. It’s compulsory, the ACMA can determine or impose a standard if it doesn’t like the code that’s being put forward by the platforms, and it’s enforceable with very large penalties. So this is a code of conduct with complete teeth.”

Mr Sims said media companies would gain access to new revenue as a result of the code.

Despite billions of dollars in fines levelled against Facebook and Google by regulators in Europe and the US over anti-competition and privacy violations, Australian regulators like the ACCC are yet to take any action against digital titans.

Mr Sims said there was no doubting his “mettle” if he needed to take either company to court, with the ACCC’s new digital unit devoted to detecting breaches of competition and consumer law.

“We’ve taken on some of the biggest companies, including Apple, Visa, Heinz. We need changes to the laws and of course we need to have a focused unit looking at this.”

Mr Sims said he found it astounding that in his discussions behind closed doors with Facebook and Google the companies would regularly claim they should not be subject to any mandatory codes: “We did speak to them about a range of our recommendations and I think their answer was ‘well look, we’ll do that, just don’t make it compulsory. We’ll do a range of things under the heading of trust us’ — which I don’t think is going to work. The most disturbing thing was the indifference to what’s going on their platforms.”

The Morrison government has deferred a response to the final report until the end of the year, embarking on “further consultation” with digital and traditional media.

Facebook managing director (Australia and New Zealand) William Easton said he was committed to the process with the government and shared the “ACCC’s view that Australians should have control of their information and that supporting a sustainable news ecosystem is critical for our modern society, and we recognise the role we have to play in these areas. We have also committed to a fundamental shift in the way we operate by placing additional responsibility for privacy on the people building our products, and creating new oversight controls to ensure privacy is at the core of everything we do.”