Government arms Big Tech competition watchdog

Digital markets unit of competition regulator could fine Big Tech companies that abuse market position up to 10% of global turnover

The Government is set to weaponize the digital markets unit of the competition watchdog, giving it regulatory teeth to punish so-called Big Tech.

Draft legislation to be published tomorrow (April 25) will put the digital markets unit on a statutory footing, giving it regulatory powers to prevent big technology platforms, such as Google, Amazon and Facebook, from stifling competition. It will try to prevent them from abusing dominance in areas such as search engines and app stores.

The UK first pledge to set up a watchdog to address the growing power of Big Tech three years ago but has so far failed to legislate, despite establishing the digital markets unit in 2021.

According to the Financial Times, which has seen the draft Digital Markets, Competition and Consumers bill, the new regulator will target a small number of tech giants generating at least £25bn in global turnover, or £1bn in the UK.

Any Big Tech companies found guilty of breaching competition rules cold face fines of up to 10 per cent of global turnover.

New takeover rules contained in the draft bill could stop “killer acquisitions” that eliminate nascent firms before they can develop a new service or product that poses a threat to dominant incumbents.

Big tech firms will have to nominate a senior executive to be responsible for compliance with the nee regime. The new regulator will also be able to fine companies should they fail to comply with information requests.

Tom Smith, an antitrust partner at law firm Geradin Partners, told the Financial Times that the bill was not designed to hinder Big Tech innovation, but to ensure other businesses have access to customers in a world controlled by large operators of app stores, search engines and ecommerce platforms.

The digital markets unit has been investigating Apple’s app store since 2021 and Amazon’s marketplace for third-party sellers since July last year.

Google is to allow app developers to sidestep its own billing system in its app store following a CMA investigation.

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Tim Adler

Tim Adler is group editor of Small Business, Growth Business and Information Age. He is a former commissioning editor at the Daily Telegraph, who has written for the Financial Times, The Times and the...

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