New digital markets legislation promises greater competition and fewer fake online reviews

Timeline for introduction of new law is set out by chancellor

Credit: Tumisu/Pixabay

The government has promised new laws will giver greater powers to watchdogs regulating digital markets while striving to protect consumers from issues such as fake online reviews of goods and services.

In the autumn statement unveiled today by chancellor Jeremy Hunt, the government said that, sometime during the year-long parliamentary session due to commence in May 2023, it will bring forward a new Digital Markets, Competition and Consumer Bill. 

The core objective of the bill is to ensure that the provision of adequate powers for the Digital Markets Unit (DMU) created in November 2020 and housed within the Competition and Markets Authority. 

According to the CMA’s website, its specialist tech-focused unit was established to “oversee a new regulatory regime for the most powerful digital firms, promoting greater competition and innovation in these markets and protecting consumers and businesses from unfair practices”.

The bill, if and when it becomes law, will provide the DMU with “powers to promote and tackle anti-competitive practice” in the markets under its watch, according to the statement

“Opening these markets to greater competition will encourage new challenger firms, spur innovation, and provide consumers with higher quality products and greater choice,” the statement said.

The powers afforded to the unit will include the ability to “make changes to the competition framework that will include streamlined decision making and updating merger and fine thresholds”.

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The DMU will also be empowered to fulfil a remit to “protect consumers in fast-moving markets by tackling ‘subscription traps’ and fake reviews online”.

Since its creation two years ago, the Digital Markets Unit has worked on initiatives including exploring the potential codes to govern the relationship between tech giants – such as Google and Facebook – and those that advertise on their platforms.

The bill that will support its work was first trailed at the opening of the current parliamentary session in May. Since then, the government has been urged by committees in both houses of parliament to ensure that the bill provides sufficient leverage against the tech giants being regulated, and is passed into law as soon as possible.

In May, a Lords committee created to scrutinise the legislation called for the government to bring the bill before parliament “without delay” – and that a failure to do so would “stifle innovation”.

Last month, MPs on the Business, Energy and Industrial Strategy select committee reiterated the call for immediate publication of a draft version of the bill. The committee also cited the need for the DMU to be given “teeth”, in order to protect consumers.

Today’s announcement does, perhaps, not provide quite the urgency encouraged by these committees, but does at least commit to a timeline for introducing the bill: which is now set to be put to parliament by April 2024, at the latest.


Sam Trendall

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