Rise of digital marketplaces


INSIGHT
Published
Jul 28th '21
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With more and more consumers turning to online shopping, the Australian Competition and Consumer Commission (ACCC) has announced that it will investigate digital marketplace giants such as Amazon, eBay, Kogan, and Catch. The aim is to examine competition and consumer concerns.

 

Scope of the ACCC’s inquiry into digital marketplaces

One side-effect of the pandemic is a 57% growth in online purchasing in 2020. ACCC Chair Rod Sims said: “These online marketplaces are an important and growing segment of the economy, so it is important that we understand how online marketplaces operate and whether they are working effectively for consumers and businesses.”

 

The ACCC is particularly interested in:

 

  • Competition: the degree of competition between the marketplaces in Australia and the extent to which competition from other sources constrains or affects their practices
  • Third-party sellers: the benefits consumers and third-party sellers derive from using the marketplaces
  • Payment terms: the nature of the marketplaces’ terms and conditions, fees, and other charges and their impact on third-party sellers and consumers
  • Placement and priority of certain brands: how marketplaces determine which products are given more prominent placement or are more visible in the marketplace, and how this impacts competition and consumers
  • Use and collection of data: the extent to which marketplaces collect, analyse, and use data from third-party sellers and consumers
  • Supply of own products: where marketplaces also supply their own products on the platform, the impact that these sales and associated practices may have on competition with third-party sellers
  • Pricing strategies of suppliers: the impact of the marketplace’s terms, conditions, and functionality on the pricing strategies of sellers and on the final consumer prices
  • Promotions and advertising: the impact of practices engaged in or facilitated by marketplaces to influence consumers to purchase goods
  • Consumer protection: the role marketplaces play in protecting consumers
  • Complaint handling: the effectiveness of the marketplaces’ complaints handling and dispute resolution processes

 

The ACCC is seeking submissions from consumers, platforms, and third-party sellers by 19 August 2021. A final report is due by 31 March 2022. The issues paper outlines the scope of the inquiry.

 

Read the full article, here.

 

Source: marshalls+dent+wilmoth lawyers

 

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