Sydney, Dec 10 (IANS): Flagging lack of transparency around the algorithms that Google and Facebook use to display ads and news, Australia's consumer watchdog has said that the tech giants need to be monitored closely so that they do not abuse their power.

The Australian Competition and Consumer Commission (ACCC) has recommended a mechanism for monitoring how the major tech companies rank and display ads and news content, News.com.au reported on Monday.

The task for monitoring and reporting the activities of the tech giants should be given to a new or existing regulatory authority, the watchdog said, adding that these measures are necessary to prevent the powerful companies from harming the country's media and digital advertising industries.

In a report, the ACCC argued that the dominance of platforms like Facebook and Google -- who derive a vast majority of their revenue from advertising -- demands increased regulatory oversight.

"Australian law does not prohibit a business from possessing significant market power or using its efficiencies or skills to 'out compete' its rivals," ACCC Chairman Rod Sims was quoted as saying by News.com.au.

"But when their dominant position is at risk of creating competitive or consumer harm, governments should stay ahead of the game and act to protect consumers and businesses through regulation," Sims added.