Home Telecoms & NBN Tech disruption poses consumer advocacy challenges: ACCC

Australian consumer watchdog chief Rod Sims says new technology and digital disruptions pose new challenges for the ACCC, not least of all the importance of ensuring robust consumer advocacy continues to play a part in protecting consumer interests.

Sims says that while technology brings access to more products, services or information than at any previous time, with it come new challenges in ensuring consumer protections in a changing world.

“In the past year we’ve been working on issues as varied as the sharing economy, rogue online traders, and, of course, raising awareness about scam artists finding ever-more sophisticated ways to part people from their hard-earned cash,” Sims told an audience at the National Consumer Congress on Wednesday.

“We’re seeing new retail practices like ‘subscription traps’, some of which do and some of which don’t comply with Australian Consumer Law, and the challenges of working with and ensuring compliance with what is a truly global marketplace.”

Sims highlighted the recent data availability inquiry being undertaken by the Productivity Commission and the role of consumer advocacy in protecting consumers.

“The amount of data people share day to day is enormous, yet much of it is inaccessible to the people who created it. And often this is taken for granted by the consumer.

“It’s in this sort of situation that advocacy can make a significant impact. By fighting for the rights of the consumer in a changing digital landscape, you can help ensure that consumer protection moves with the times and that consumers are not caused detriment by fast moving, disruptive technologies or by anti-competitive responses to those technologies by incumbent businesses.”

He was scathing about some large companies and their attitudes towards customers.

“Since coming into this position 5½ years ago, I am continually puzzled as to why some large companies treat their customers so badly, and with so little respect,” Sims told his audience.

“We are often told that companies will only succeed by meeting customer needs. It is clear that some companies seek to deceive their consumers about these needs.

“Companies also often enter public policy debates making only self-serving arguments. This is why it is vital that you and we are available to put a counter view.

“Companies often then wonder why their standing in the community and their ability to influence public debate is so low. They often do not seem able to connect the obvious dots.”

Sims said consumer advocacy was essential to ensuring all consumers gained the benefits of a well-functioning market economy and, “while the ACCC plays a role in this through our enforcement and compliance activities, we cannot do this alone".

“And this is where you all come in. A big part of today is to acknowledge the importance of the work you all do.

“When consumers experience unfairness, whether through unconscionable conduct, being misled or deceived, or finding themselves locked into a standard form contract containing terms that unfairly benefit the business, it’s all too easy for them to become angry and disengage from the process of defending their rights.

“The contribution you all make to empowering consumers is considerable and essential to making sure that our market economy works as it should.”

Sims said the ACCC’s consumer-focused priorities covered a diverse range of areas and the commission would move beyond the “traditional” areas of consumer guarantees from, for example, consumers’ well-known rights for a repair, replacement or refund when sold defective goods such as clothing, electrical items and household appliances.

The telecommunications industry is on notice of more scrutiny from the ACCC, with Sims saying this year the commission will look at more complex products such as motor vehicles and the provision of services in industries such as telecommunications and airline travel.

He said the commission’s new car retailing market study would also look at the difficulties consumers faced when trying to exercise their consumer guarantee rights and the factors that contribute to this.

The study would go beyond consumer guarantees and cover issues such as access to data and efficiency and emission claims.

“The access to data issues in particular have implications across many areas of interest to consumers.

“Clarity around broadband speed advertising for consumers will also be a focus. Consumers are calling for standardised information to help them make informed comparisons between the different speeds available on the market.”

Sims reconfirmed the ACCC’s recent announcement that, to address broadband speed issues, it had published six principles to help ensure Internet service providers’ claims about broadband speeds weren’t misleading under Australian Consumer Law.

“We will also publish a best-practice broadband speeds advertising guide for providers in the coming months and we’re hoping there’s some more news to announce soon in relation to a broadband monitoring programme.”

On the year-long review of Australian Consumer Law, Sims said consumer groups had “brought a lot to the table and the review had provided the opportunity to examine the law and determine what was working and what could be improved".

He made it clear he considered penalties for breaches of the law were inadequate.

“One point we have particularly advocated for during the review is the importance of penalties that act as an effective deterrent.

“To be effective, the penalties handed out to companies that breach consumer laws have to make their boards and shareholders sit up and take notice.

“You would have heard me say this before, but the penalties, as they currently stand, simply do not resonate. And they certainly don’t reflect the detriment experienced by the consumer as a result of the misconduct.”

Sims said penalties should be seen as more than just a cost of doing business.

“And businesses should understand the seriousness of the issues involved with them breaking the law,” he warned.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

 

 

 

 

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