The Australian Government instructed the ACCC to develop a mandatory code of conduct, marking a change from the voluntary approach initially set out.
Background: Between 2018 and 2019, the Australian Competition and Consumer Commission (ACCC) carried out an inquiry into digital platforms. In July 2019, the final report found that Google and Facebook have “substantial market power” distorting the ability of business to compete on their merits in advertising, media, and a range of other markets. The report included 23 recommendations to tackle the problems it highlighted. In December 2019, the Australian Government responded to the inquiry, committing to invest AUD26.9m (USD17.1m) in a new special unit within the ACCC to monitor competition in digital platform markets, and to implement a platform-neutral regulatory framework for media. To address bargaining power imbalances, the Government asked the ACCC to work with relevant parties on voluntary codes, to be finalised during 2020.
The Government intervenes: In its response to the inquiry, the Government had indicated that, if an agreement on voluntary codes was not forthcoming, it would develop alternative options, including the creation of a mandatory code. On 20 April 2020, the Government announced the introduction of a mandatory code of conduct to govern the commercial relationship between digital platforms and media companies, noting that the original timeframe now requires acceleration. The pressure under which the Australian media sector already was, has now been exacerbated by a sharp decline in advertising revenue driven by the coronavirus pandemic. At the same time, progress on a voluntary code has been limited, and the ACCC considers it unlikely that any voluntary agreement would be reached on the key issue of payment for content.
What will the code look like? The ACCC will have to address commercial arrangements between digital platforms and news media businesses. The code will cover elements such as the sharing of data, ranking and display of news content, and the monetisation and sharing of revenue generated from news. It will also establish enforcement, penalty, and binding dispute resolution mechanisms. The ACCC is expected to produce a draft code for consultation by the end of July 2020, with a final code to be settled soon thereafter.
