Regulators from the UK to China have made strengthening consumer protection in the digital economy a priority
ACCC opens reviews into deceptive online practices: On 4 October 2022, the Australian Competition and Consumer Commission (ACCC) launched two ‘internet sweeps’ to identify misleading environmental marketing claims and fake online business reviews. The ‘greenwashing’ review will investigate at least 200 company websites for misleading environmental claims across a range of sectors, including energy, vehicles, food and drink packaging, cosmetics and clothing. As consumers increasingly shop with sustainability in mind, the ACCC is increasingly concerned that some businesses are falsely promoting their green credentials, as well as about the impact that such misleading claims have on consumer understanding, trust and confidence in the market. The investigation will help inform businesses as to what steps they can take to improve the integrity of their environmental claims, with the competition authority ready to take enforcement action where it sees that consumers are being misled or deceived.
Investigation seeks to identify patterns in misleading behaviour: The second review will target fake or misleading online reviews and testimonials posted to firms’ websites, Facebook pages and third-party review platforms. At least 100 businesses will be investigated, with the ACCC targeting a range of sectors, including household appliances, electronics, food and restaurants, and travel services. According to the ACCC, consumers are facing a suite of manipulative marketing techniques designed to exploit or pressure them. This is due in part to the large number of information sources available online, which consumers often rely on when making purchases. Meanwhile, businesses can also be significantly impacted by negative reviews at the hands of competitors or incentivised, third-party professional reviewers. The ACCC is particularly focused on identifying platforms or sectors where there is a pattern of misleading online reviews that have the potential to cause harm.
Regulators are strengthening consumer protection in the digital economy: The ACCC’s investigations will be followed up with compliance, education and potential enforcement activities to enable consumers to make more informed purchasing decisions. The ACCC is not the only regulatory body to be looking to strengthen consumer protections online; Ofcom in the UK has launched a review into competition and consumer issues in digital markets, while China has required local tech companies to share information on their recommendation algorithms. The recent Connected Britain and FT-ETNO events (in London and Brussels, respectively) indicated that greenwashing is an issue affecting European telecoms, prompting calls for more accurate measurement, reporting and assessment of carbon emissions and sustainability initiatives across supply chains.
Source: https://www.accc.gov.au/media-release/accc-internet-sweeps-target-greenwashing-fake-online-reviews
