Government’s digital platforms inquiry response ‘lacks holistic approach’

By Jerome Doraisamy|17 December 2019
ACCC

The federal government’s proposed changes to the digital platforms landscape are a “clear step towards implementing regulatory change, but may signal a move away from a holistic overhaul” of technology regulation, according to one global firm.

The Morrison government’s response to the Australian Competition and Consumer Commission’s (ACCC) Digital Platform Inquiry is running the risk of potentially falling short of the ACCC’s initial vision, argues Herbert Smith Freehills.

HSF senior associate Lisa Emanuel said the government’s response will “no doubt drive change, though arguably moves us away from the comprehensive and holistic view” of technology regulation that the ACCC advocated for.

“At the time the Digital Platforms Inquiry was announced, it was groundbreaking in its attempt to take a comprehensive and cross-functional view of the complex regulatory landscape applying to digital platforms,” she said.

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“The final report, at over 600 pages, considered the intersection of competition, consumer and privacy issues from a broader perspective of consumer welfare and trust. The ACCC advocated for a holistic approach to addressing competition law, consumer law, data protection and privacy and media regulation where digital platforms are concerned.

“Given the nature of policy and legislative reform, there is some cause to address each of these in a piecemeal way. But the government’s proposed reforms are to be made over a long timeframe, a move that may, in practice, result in a breakdown of the overarching approach the ACCC is advocating.”

HSF senior associate Anna Jaffe added that the government’s “incremental approach” could still lead to significant changes in the regulatory environment, not only for digital platforms, but for many other data- and media-driven businesses.

“The tech regulatory landscape is changing rapidly. It is complex and fragmented, both globally and by subject matter, making it difficult for technology providers to navigate,” she said.

“The government’s proposed changes are significant. However, there is a risk that this piece-by-piece approach could lose sight of the broader, more fundamental challenges that the inquiry highlighted as being posed by new and emerging technologies and technology providers to existing regulatory environments worldwide.”

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Technology companies are welcoming of regulatory change that provides them with guidance, Ms Jaffe continued, provided any reforms promote innovation and business growth.

“Trust in the technology industry has been damaged over recent years, particularly in respect of the privacy and security of data. This has then led to a fundamental rethink of the formerly ‘light-touch’ approach to its regulation,” she said.

“Regulation can take a critical role in building trust. If implemented in a way that drives toward a coherent and holistic global standard, regulation can help industry [participants] establish or maintain a social licence to operate, and accordingly create an environment for their activities to flourish.”

Ms Emanuel said that any approach the government decided to take over the coming years would “lead to substantial change for Australian businesses”.

“Whatever the outcome, there is no doubt that businesses in every sector will need to monitor and approach compliance comprehensively, holistically, and with an eye towards driving standardisation over time in order to remain ready to respond to the digital age,” she said.

Government’s digital platforms inquiry response ‘lacks holistic approach’
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