Google's dominance in digital advertising in Australia must be immediately addressed, the country's consumer regulator said, setting the stage to another dispute with the U.S. company.

The Australian Competition and Consumer Commission is proposing to allow internet users choose what personal information companies such as Google share with advertisers as part of the country's efforts to end the dominance of tech companies.

As part of the regulator's long-running digital platforms investigation, the ACCC launched a probe in March last year into the complex business of online ads, including issues with the markets where ads are sold and bought.

Google said last week it would block its search services in Australia if the country enacts legislation on a new data privacy code that would force it and Facebook to pay media companies for the right to use their content.

The latest interim report released Thursday stokes frictions further between the Australian government and Google. "There is a real lack of competition, choice and transparency in this industry," ACCC Chairman Rod Sims said in remarks quoted by Bloomberg News.

Australia's digital advertising industry is valued at almost A$3.5 billion. The ACCC estimates Google's share of the country's digital ad sales at between half and 100%, depending on the service. A Google representative did not immediately respond to a comment request on the ACCC report.

"While there are a huge number of ad tech providers across the supply chain, Google is by far the biggest provider of each of the four key services considered," The Guardian quoted the ACCC inquiry as saying in the report.

Google's comments on disabling its search platform in Australia drew a sharp criticism from Prime Minister Scott Morrison, who said the country makes its own policies for "things you can do in Australia."

"People who want to work with that in our country, you're very welcome. But we don't respond to threats," Morrison told reporters.

The ACCC said it is seeking feedback on how to promote competition in advertising technology, including guidelines to oversee disputes in interest and prevent so-called self-preferencing in the provision of ad tech services.