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Sharing similarities to the EU’s DMA, the UK bill aims to promote competition and give regulators new powers to penalise companies that breach consumer law.
The UK has unveiled a new bill that aims to reign in Big Tech dominance and give regulators new powers to tackle unfair business practices.
The Digital Markets, Competition and Consumers (DMCC) Bill aims to boost the level of competition among businesses “both online and on the high street”. This includes digital markets that the UK claims is dominated by a “small number of firms”.
The wide-ranging bill also aims to tackle tactics that trick consumers, such as fake reviews on websites and “subscription traps” that make it difficult for users to opt-out and cost an estimated £1.6bn a year.
The new measures will come into effect following parliamentary approval, subject to secondary legislation and the publication of guidance.
To enforce these new rules, the bill will give new powers to the Competition and Markets Authority (CMA), one of the country’s lead regulators against Big Tech.
The bill will create a digital market unit within the CMA to handle the “excessive dominance” that a small number of tech companies currently hold.
“This market dominance has stifled innovation and growth across the economy, holding back start-ups and smaller firms from accessing markets and consumers,” the UK government said in a statement.
The new legislation will mean reforms will give the CMA and courts the power to fine companies up to 10pc of their global turnover if they breach consumer law. The CMA’s new digital markets unit will also be able to carry out targeted interventions to fix competition issues.
The UK’s business and trade minister Kevin Hollinrake said smartphones and online shopping have “profoundly changed the landscape” for businesses, consumers and “the foundations of a modern thriving economy”.
“From abuse of power by tech giants, to fake reviews, scams and rip-offs like being caught in a subscription trap – consumers deserve better,” Hollinrake said.
“The new laws we’re delivering today will empower the CMA to directly enforce consumer law, strengthen competition in digital markets and ensure that people across the country keep hold of their hard-earned cash.”
Following the EU’s footsteps
The new legislation bears a lot of similarities to the Digital Markets Act (DMA), the landmark batch of EU rules that aim to crack down on anti-competitive behaviour by Big Tech and level the playing field in digital markets.
The DMA pushes for greater competition within the EU to improve choices for consumers. It also gives regulators the ability to impose greater fines on companies that breach DMA rules. The DMA was approved last year and is expected to come into force in 2024.
The sister act to the DMA is the Digital Services Act (DSA), which aims to make the internet safer with new rules for all digital services, from social media platforms to search engines, online marketplaces and more.
The obligations under the DSA include measures to counter illegal content online and obligations for platforms to react quickly.
The law also aims to impose an increased transparency and accountability on platforms, such as by making them provide clear information on content moderation or the use of algorithms for recommending content.
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