ACCC urges social media regulatory reform, eyeing data collection, fake reviews

Rakshnna Pattabiraman

2nd May 2023

A range of harm consumers and small businesses face in Australia has been highlighted in a new report by the Australian Competition and Consumer Commission (ACCC).

ACCC chair, Gina Cass-Gottlieb, said the regulator is “concerned about the level of influence social media platforms hold over users” and their position as “critical intermediaries” for businesses to reach customers.

Issues such as excessive data collection, lack of effective dispute resolution options and transparency, scams and insufficient disclosure of sponsored content by influencers and other brands warrant a systemic reform.

The report also found Facebook-parent Meta possessing a “significant market power” in operating social media services as Australians spend more time on Facebook and Instagram combined compared to other platforms.

“Limited competition in these services can lead to poorer outcomes for consumers and small businesses,” said Gottlieb.

She has urged implementing specific reforms including mandatory processes for consumers and businesses to report on social media platforms to remove scams, harmful apps and fake reviews, and establishing an external Digital Ombuds Scheme.