‘UK’s post-election cleanup yields success for ‘Pro-competition’ rules governing Big Tech’

Big Tech, pre-election, tags: pro-competition, UK, wash-up

The Digital Markets, Competition and Consumer Bill (DMCC) has finally been passed by the House of Lords in the UK, clearing the way for it to become law. The bill, which aims to rein in the market power of Big Tech companies, grants the Competition and Markets Authority (CMA) enhanced powers to regulate and penalize tech giants like Apple and Google. It also allows the CMA to directly impose fines for breaches of consumer law, bypassing the need for court proceedings.

The DMCC was originally proposed by the government in 2020 but faced delays before being revived by current Prime Minister Rishi Sunak, who added additional consumer protection measures. However, the bill’s passage was in jeopardy due to the surprise announcement of a summer general election. Despite this, the DMCC made it through the “wash-up,” the final days and hours of parliamentary time before campaigning begins.

The swift passage of the DMCC can be attributed to its widespread support across the political spectrum. Although it was introduced under Conservative governments, the opposition Labour Party also backed the bill. During the House of Lords debate, Labour peer Baroness Jones of Whitchurch expressed support for the bill, stating that it regulates the behavior of Big Tech companies and provides protection to consumer rights.

The CMA has welcomed the bill’s passage, highlighting the new powers it will provide to tackle firms that breach consumer law and level the playing field between online businesses. The CMA intends to outline the next steps for the Digital Markets Unit, the division responsible for developing and implementing tailored rules for tech giants falling under the pro-competition regime.

While the DMCC has similarities to the European Union’s Digital Markets Act, the UK law differs in its approach. Instead of applying fixed rules to gatekeepers, the UK law gives the CMA more flexibility to design remedies that are specific to each platform. This aspect is crucial considering the rapid advancements in platform technology, such as the emergence of generative AI, an area of focus for the CMA.

The CMA has previously indicated that it plans to undertake 3-4 investigations of tech giants in the first year to assess whether they meet the law’s requirements for the special abuse control regime. While no specific companies have been confirmed, Apple and Google have long been targeted by the CMA due to their dominance in the mobile industry.

In conclusion, the passage of the Digital Markets, Competition and Consumer Bill represents a significant step forward in regulating the behavior of Big Tech companies in the UK. The enhanced powers given to the CMA will allow for greater enforcement and penalties for breaches of consumer law, with the potential for fines of up to 10% of global annual turnover. The UK’s approach to regulation differs from the EU’s fixed rules, giving the CMA more flexibility to address the unique challenges posed by rapidly evolving platform technology. With the bill set to become law, it will be interesting to see how the CMA utilizes its new powers to ensure fair competition and protect consumer rights in the digital market.

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