The U.K. government has set up a new regulator to ensure that tech giants such as Facebook and Google can’t exploit their market dominance to crowd out competition.
“There is a consensus that the concentration of power among a small number of firms is curtailing growth and having negative impacts on consumers and businesses which rely on them,” said the government in a statement announcing the new body.
The Digital Markets Unit, based in the Competition and Markets Authority (CMA), will “oversee plans to give consumers more choice and control over their data, promote online competition and crack down on unfair practices which can often leave businesses and consumers with less choice and more expensive goods and services,” the government said.
The unit will work closely with the CMA enforcement teams already taking action to address practices by digital firms, which “includes taking enforcement action against Google and Apple, and scrutinising mergers involving Facebook and eBay.”
The unit launched on Wednesday in non-statutory form ahead of legislation that will grant it full powers.
It will begin by looking at how codes of conduct could work in practice to govern the relationship between digital platforms and groups such as small businesses, which rely on them to advertise or use their services to reach their customers. It will also work with U.K. communications regulator Ofcom to look specifically at how a code would govern the relationships between platforms and content providers such as news publishers, to ensure they are as fair and reasonable as possible.
“This will pave the way for the development of new digital services and lower prices, give consumers more choice and control over their data, and support our news industry, which is vital to freedom of expression and our democratic values,” said Oliver Dowden, the U.K. Culture Secretary who also serves as Digital Secretary.
Besides Ofcom, the unit will work closely with other U.K. regulators, including the Information Commissioner’s Office and the Financial Conduct Authority. It will be led by Will Hayter, who takes over following his work at the Cabinet Office supporting the U.K.’s transition out of the EU.
“The U.K. has built an enviable reputation as a global tech hub and we want that to continue – but I’m clear that the system needs to be fair for our smaller businesses, new entrepreneurs and the wider British public,” Business Secretary Kwasi Kwarteng said. “Our new, unashamedly pro-competition regime will help to curb the dominance of tech giants, unleash a wave of innovation throughout the market and ensure smaller firms aren’t pushed out.”
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