Small businesses locked in a dispute with social media giants deserve further support, the SME ombudsman says, calling for a new arbitration service capable of taking the fight to powerful digital platforms.
An extensive review undertaken by the Australian Competition and Consumer Commission (ACCC) found digital platforms, including online marketplaces and social media hotspots, often fail to resolve small business complaints in a timely and effective manner.
The ACCC recommended the creation of a new and independent ombudsman service, capable of forcing social media platforms to the bargaining table when small businesses encounter scams, misleading reviews, and fake accounts.
The federal government backed that recommendation in principle in December last year.
But as the 2024/2025 federal budget approaches, it is yet to formally commit taxpayer funding to a new digital platform dispute resolution service.
Speaking to SmartCompany, Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Bruce Billson said he supports the call for a new service assisting small businesses with their complaints.
“Of course we do, whether it is ASBFEO or someone else, because we’re already doing it as part of our business-to-business dispute resolution assistance service,” Billson said.
The ASBFEO says the number of complaints it has received regarding digital platforms has more than doubled since July 2022, with 140 complaints heard in the past six months alone.
Those complaints are not simple grievances either, with Billson saying inaction by social media platforms can leave small businesses exposed to significant financial and reputational damage.
“It’s the ultimate run-around when you are hacked and locked out of your account and then told you need to access your account to report the problem,” he said.
“Too often, these small businesses watch helplessly as they lose customers and money, if a credit card linked to these accounts is being used by the hacker or the hacker uses the account to access and harm customers.
“Digital platform providers must do better by their small and family business customers.”
The ASBFEO has long argued that internal dispute resolution mechanisms be bolstered, making it easier for small businesses to defend their own interests.
But the sheer scale of the problem necessitates an external service for “small businesses that can’t gain a satisfactory outcome when working directly with the platforms,” Billson continued.
The ASBFEO is not the only small business support service to argue in favour of an arbitrator capable of fast-tracking disputes.
The Telecommunications Industry Ombudsman (TIO), the agency tasked with assisting small businesses in dispute with their phone or internet provider, says it is capable of taking on the job.
“My office is already hearing about problems with digital platform services from people and small businesses who assume we are the right body to respond to these complaints,” Ombudsman Cynthia Gebert said in March last year.
“The TIO is ready to expand its remit to take complaints about digital platforms, either through a pilot or as a permanent part of our jurisdiction.”
SmartCompany has contacted the TIO for comment.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
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