Submission to the Australian Competition and Consumer Commission
Regarding the Australian Direct Marketing Association (ADMA)'s Application for Approval of a Code of Practice

Roger Clarke

Principal, Xamax Consultancy Pty Ltd, Canberra

Visiting Fellow, Department of Computer Science, Australian National University

Version of 15 December 1998

© Xamax Consultancy Pty Ltd, 1998

This document is at http://www.anu.edu.au/people/Roger.Clarke/DV/ACCC-ADMA-2.html

A previous submission was made on this matter.

Comprehensive information is provided on Robin Whittle's site.

15 December 1998

Dear Mr O'Neill

Re: Application for Authorisation No. A40077 - A.D.M.A.

I refer to my previous written submission of 21 October, my verbal submission of 26 November, and your request for further submissions.

I make the following additional comments:

• nothing subsequently provided by ADMA in written or verbal form has in any manner changed the situation: far from conferring public benefits, ADMA's code is seriously harmful to the consumer interest;
• the submissions of consumer and privacy interests groups have made abundantly clear that ADMA has made serious misrepresentations to the Commission concerning the extent to which it has undertaken consultation;
• the submissions of consumer and privacy interests groups have identified a very large number of deficiencies in many different aspects of the code;
• ADMA showed itself at the pre-decision conference to have no interest whatsoever in modifying its code to address its many, significant deficiencies;
• a meaningful consultation process is essential. Submissions need to be catalogued into generic, segment-specific and clause-specific points; and a succession of workshops need to establish which points are uncontroversial and which require debate, negotiation and consensus-building. This requires the support of a secretariat that is accepted by all parties as being independent and trustworthy;
• the code does not reflect the public's great and still-growing concern about outbound telemarketing, but simply assumes that consumers' telephones and consumers' time are there to be plundered by marketers;
• the code demonstrates ADMA's abject failure to appreciate the nature of the Internet, and of Internet marketing. In Mr Rob Edwards' own words, this was merely "a starting-point for further negotiations" (although consumer and privacy advocates would describe it as an 'ambit claim').
• In addition to the substantial amount of information provided in my paper on 'Direct Marketing and Privacy' (previously submitted), I draw to your attention the following further sources:
  • Issues in Business-With-Consumer Electronic Commerce, which is a segment of a paper completed on 22 November 1998 , at
  • http://www.anu.edu.au/people/Roger.Clarke/EC/Issues98.html#Iss2
  • the statement by the Australian Computer Society (authored by myself, but revised and approved by ACS Council), which is published in 'The Australian' Computer Pages of today, 15 December 1998 (p.55), and available at http://www.acs.org.au/news/oz151298.htm
• The submissions by organisations with competence in relation to Internet matters have urged the removal of Part D, as a completely inappropriate approach to the matter;
• the code sets an extremely low hurdle even for members of ADMA. For the large number of direct marketers that are non-members of ADMA, approval of the code would be a signal that their activities will not attract attention from the authorities unless they are seen to be a great deal worse than the norms that fall within the code.

In summary:

• it would be to the serious detriment of consumer interests in this country were the Commission to approve the code, or any part of it;
• the case against the code is so overwhelming that approval of the code would also be to the serious detriment of the Commission's reputation in relation to its consumer protection responsibilities;
• the Commission should make clear to ADMA that for a code to be approved as being in the public interest, it would have to be clearly the result of a meaningful consultation process, and represent an effective balance between consumer and privacy interests, and the economic interests of marketers.

Yours sincerely

Roger Clarke

Director

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Created: 15 December 1998

Last Amended: 15 December 1998

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