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ACCC Appeals Google Adverts Decision

Issued: October 01 2011

The Australian Competition and Consumer Commission has filed an appeal against the recent decision by Justice Nicholas of the Federal Court in relation to certain advertisements appearing on Google’s website.

The ACCC alleged that Google had engaged in misleading or deceptive conduct by publishing these advertisements on Google’s search results page where a headline of the advertisement comprised a business name, product name or web address of a business not sponsored, affiliated or associated with the advertiser. When a user clicked the words in the heading of the advertisement associated with the competitor’s business or product, he or she was taken to the advertiser’s website.

Nicholas found that although a number of the advertisements were misleading or deceptive, Google had not made those representations. Google merely communicated representations made by the advertiser. As such, Nicholas ruled that Google had not breached the Trade Practices Act.

The ACCC appeal to the Full Federal Court is in respect of four advertisements. Nicholas found that Google would have been unable to show that it had no reason to suspect that publication of these advertisements was a breach of the Act. The ACCC considers that the Full Court may find that Google made the representations in question and find Google directly responsible for the publication.

The ACCC takes the view that Google’s key word insertion system, plus the role of Google staff, were fundamental to the representations being made.

It is significant that the previous Federal Court decisions considered by Nicholas related to publishers of advertisements in traditional forms of media, such as print and television. The reasoning in those cases is not easily translated to the practices of search engine providers such as Google in publishing sponsored entries as part of search results.

“The role of search engine providers as publishers of paid content needs to be closely examined in the online age. Specifically, it is important that they are held directly accountable for misleading or deceptive paid search results when they have been closely engaged in presenting and publishing those results.” ACCC chairman Rod Sims said.

It is estimated that online search advertising in Australia through search engines such as Google, is currently worth around $830 million per year. Google is the dominant search engine provider and player in the Australian market. Online advertising grew around 20% in the last financial year.

“It is very important that the law in this area is clarified and fully understood,” Sims said.

NBN Releases 12-month National Rollout Plan

Work has begun on the rollout of the National Broadband Network in areas that are expected to cover more than half a million homes and businesses across Australia when complete. Eventually, NBN will offer wholesale speeds of up to 100 Mbps to 93 percent of Australian premises by 2021. The remaining 7 percent of premises are expected to receive highspeed broadband via fixed-wireless and satellite, with the rollout of both services expected to be complete by 2015.

NBN’s inaugural 12-month construction plan names 28 new locations as part of the national rollout passing 485,000 premises where construction of the fibre optic network is expected to commence over the following 12 months. It also lists those sites where the rollout is already underway, accounting for a further 63,500 premises, including Second Release Sites, such as Geraldton in Western Australia, and extensions to First Release Sites such as Townsville in Queensland.

On average, it is expected to take 12 months from the start of the fibre network rollout in a given area until individuals are able to receive high-speed broadband over the NBN. Once the network is built and ready for service, householders and business owners can purchase broadband and telephony packages from one or more of the 28 retail telecommunications providers that have signed up to offer services over the network. Twelve of these companies have already completed the necessary accreditation and onboarding process in preparation for service delivery.

“[This] announcement represents the start of a major nationwide construction effort that should eventually see us offer National Broadband Network coverage to every one of Australia’s 13 million premises,” said NBN CEO Mike Quigley. “We’ll be publishing regular updates about where precisely the NBN is being rolled out and when it will reach each area. Public education activity, to launch next year, will also explain what the rollout will mean for every Australian, how to connect to the network and why it is important that the nation upgrades its telecommunications infrastructure.”

Copyright Safe Harbour May be Expanded

The Australian government is currently considering extending the “safe harbour” provisions under the Copyright Act 1968 (Cth) to include a broader range of service providers. The Attorney General has recently released a consultation paper outlining the proposed amendments.

“Under the current provisions, the safe harbour scheme applies only to carriage service providers, namely service providers operating primarily as a provider of network access to the public,” say lawyers at Blake Dawson, writing in the firm’s Online TMT newsletter. The proposed amendments seek to expand the safe harbour scheme to include:

 The provision of network access to clients, customers, students and other users who do not constitute the public at large;

 The provision of online services which do not constitute “network access,” which will incorporate online search engines, bulletin board operators and online vendors; and

 The provision of network access where it is not a primary operation.

“The proposed expanded definition of service providers will include a person who provides services relating to, or provides connections for, the transmission or routing of data, or operates facilities for, online services or network access, but does not include such person or class of persons as the Minister may prescribe in the Regulations,” the firm said.


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