A British regulator will create a “pro-competition” unit to ensure tech behemoths like Google and Facebook don’t use their sway to force out smaller rivals, which could be empowered to overrule company decisions and levy fines.
The UK’s Competition and Markets Authority (CMA) said on Friday that it would set up a “Digital Markets Unit” next year, intended to give consumers “more choice and control over their data” and to “help small businesses thrive,” among other goals.
“Digital platforms like Google and Facebook make a significant contribution to our economy and play a massive role in our day-to-day lives – whether it’s helping us stay in touch with our loved ones, share creative content or access the latest news,” said UK Business Secretary Alok Sharma. “But the dominance of just a few big tech companies is leading to less innovation, higher advertising prices and less choice and control for consumers.”
Our new, pro-competition regime for digital markets will ensure consumers have choice, and mean smaller firms aren’t pushed out.
The new unit, set to begin operations next April, “could be given powers to suspend, block and reverse decisions of tech giants, order them to take certain actions to achieve compliance with the code, and impose financial penalties for non-compliance,” the CMA said in a press release, pointing to the two American firms’ influence in the field of digital ads, accounting for about 80 percent of the UK market last year.
Working alongside other regulators, such as Ofcom and the Information Commissioner’s Office (ICO), the pro-competition unit will also introduce a new “code of conduct” to govern the digital marketplace and “ensure consumers and small businesses aren’t disadvantaged.” The code will require the firms to be more transparent about their own services and advertising, as well as about how they use consumer data.
The project carries on the work of the Digital Markets Taskforce, established earlier this year to provide advice to the government about how to address big tech firms, which is due to issue a report before the end of the year. The newly created unit will build on those efforts and “operationalise” the taskforce’s recommendations.
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