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Australia Proposes Fines for Big Tech to Boost Fair Competition

By  |  December 2, 2024

Australia has proposed legislation that could impose hefty fines of up to A$50 million ($33 million) on Big Tech companies engaging in anti-competitive practices. The proposed law is the latest effort by the centre-left Labor government to curb the influence of Big Tech, following last week’s parliamentary approval of a ban on social media access for children under 16.

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    Assistant Treasurer Stephen Jones, addressing the McKell Institute in Sydney, highlighted the challenges posed by the digital economy to existing legal frameworks. According to excerpts of his speech obtained by Reuters, Jones stated, “The digital economy challenges our current legal framework,” emphasizing the monopolistic tendencies of dominant platforms, which can lead to higher costs, restricted consumer choice and barriers to innovation.

    The proposed legislation would grant Australia’s competition regulator the authority to oversee compliance, investigate anti-competitive behaviors, and enforce penalties. Inspired by the European Union’s Digital Markets Act, the law aims to facilitate consumer freedom to switch between competing services, such as app stores, browsers, and social media platforms.

    Targeting Dominant Players

    The Australian Competition and Consumer Commission (ACCC) has been instrumental in shaping the draft law. Based on its recommendations, the government plans to prioritize app marketplaces and advertising technology services for regulatory obligations. Jones remarked that these obligations would prevent companies from unfairly promoting their own products, such as apps with low user ratings, or giving preferential treatment to their services over those of third-party competitors.

    Read more: Australia Passes Strict Social Media Ban for Under-16s

    The dominance of tech giants like Apple, Google and Meta has been a focal point of concern. According to a 2022 ACCC report cited by Reuters, Google controls an overwhelming 93% to 95% of online search services in Australia. In the app download market, Apple’s App Store holds 60% of the share, with Google Play accounting for the remaining 40%.

    Seeking Public Input

    The government is encouraging feedback on the proposed law, with a consultation process open until February 14, 2024. More discussions are expected before a draft bill is finalized. While Apple, Google, and Meta have yet to comment on the proposed measures, the legislation signals a shift toward stricter oversight of digital platforms.

    Jones warned that unchecked market power stifles competition, innovation and consumer choice. By targeting dominant platforms, the proposed law seeks to level the playing field for smaller players and promote a healthier digital ecosystem.

    Source: Reuters