ACCC to probe Australian sharing economy ratings

Sharing economy platforms such as Uber and Airbnb will be probed by the Australian Competition and Consumer Commission as it moves to assess the online review and endorsement process of the players in the local market.

The Australian Competition and Consumer Commission (ACCC) has announced it will be looking into the sharing economy, probing the review and endorsement policies of platforms in the local market.

The consumer watchdog said the review forms part of the International Consumer Protection and Enforcement Network (ICPEN) annual internet sweep, which involves over 50 consumer protection agencies around the world.

"The ACCC has three clear messages for businesses handling online reviews," ACCC Deputy Chair Delia Rickard said in a statement. "Be transparent about commercial relationships and don't let these influence the order in which reviews are published; don't post or publish misleading reviews; and editing or deleting unfavourable reviews may be misleading."

While the ACCC understands reviews and ratings have the potential to play a large role for both providers and users in the sharing economy, it noted that Australian Consumer Law prohibits businesses from making or inducing false or misleading representations through testimonials or reviews.

"The ACCC has also looked closely at the consumer law issues involved in the sharing economy, where a platform connects providers and users, both of whom are usually individuals or small businesses," the watchdog said.

The ACCC has previously produced its own guidance for businesses [PDF] and has also taken action against businesses that have done the wrong thing in the past.

Rickard believes the sharing economy is a "fantastic development" in that it offers a range of benefits for consumers and businesses. However, she noted that operators of sharing economy platforms must make sure that they have appropriate policies to regulate the use of reviews to avoid misleading consumers.

The ACCC probe is expected to look into a range of platforms to find out what each are disclosing about their policies for publishing reviews and ensuring that reviews, and the way they are presented, are accurate and not misleading for consumers.

The information will also be shared with all 58 of the ACCC's ICPEN partners, as well as to the Australian state and territory consumer protection agencies.

Earlier this year, Kate Burleigh, Intel Australia managing director, said that when it comes to the sharing economy, the onus is on a business to determine what regulations should be put in place to make it a trustworthy space.

"My premise would be that we can't really wait for the regulators to catch up. It's definitely our jobs as companies like Intel ... but the reality is, industry is always going to move faster than the regulators," she said.

"So our advice to everyone is set your own standards. Set those standards really high and start running ahead of the regulators because if you wait for the regulators to define it, you'll be waiting too long and someone will work it out before you."

Almost a year ago, Federal Opposition Leader Bill Shorten provided his thoughts on the sharing economy, announcing he wanted Australians to make money from sharing their properties and services.

"The sharing economy offers exciting potential at the edge of today so that we can do better in the future," Shorten said.

At the time, the Labor Party published a fact sheet [PDF] that outlined six principles for the sharing economy that Shorten wanted to turn into rules and regulations to help give rise to the next Uber or Airbnb.

When fighting the Australian Taxation Office (ATO) on the Goods and Services Tax (GST) paid by Uber drivers last year, David Rohrsheim, Uber Australia and New Zealand general manager, said the ATO had singled out Uber drivers for "special treatment". He also said that the ATO's process involved a "whole bunch of red tape", which he was adamant would get in the way of the sharing economy.

At the time Rohrsheim said that it was a missed opportunity by the states and territories in Australia to take up what is on offer by the sharing economy.