Protection needed for small sellers on online platforms, Ombud says

Australian small business and family enterprise ombud (ASBFEO) Bruce Billson said an increase in complaints his office received from small businesses about digital platforms demonstrated that the sector needs formal dispute resolutions and more regulation. 

In a submission to the Australian Competition and Consumer Commission (ACCC)’s Digital Platforms Inquiry dated last Friday, Billson said he estimated ASBFEO had received 500 complaints from small businesses about online platforms that the platforms had not been able to resolve themselves. 

Billson’s submission echoes the ACCC’s own finding in its fourth Digital Platform Services Inquiry report, which said that online marketplaces lack adequate dispute resolutions for sellers. 

Billson said complaints mainly fell into four categories. 

These included ‘account blocking and hacking’ and ‘a lack of appeal processes’, in which a digital platform makes a decision on a business that is unable to be appealed even if it is against the platform’s own policies.

They also included ‘fraudulent misrepresentation’: when other operators fraudulently misrepresent themselves by mimicking Australian small businesses online with the aim of hijacking the trade, and  ‘fake review campaigns’ which are orchestrated campaigns targeting small businesses with fake negative reviews. 

Billson gave the example of ‘a young social media-based sole-trader’ whose Instagram business account was hacked by a bitcoin scam account and was unable to restore it until ASBFEO reached out to Meta on their behalf. 

“Our experience with Meta has demonstrated a typical 7-day timeline for resolving account access issues, which may seem timely for an individual user, but can be incredibly damaging to those relying on Facebook or Instagram for the entirety of their trade.”

Billson recommended the creation of a small business disputes Federal Circuit Court list, minimum dispute resolution standards, and enforceable guidelines for review platforms, including an amendment to the Social Media (Anti-Trolling) Bill 2022 to impose timeliness requirements on digital platforms’ responses.