UK government announces Digital Markets Unit to regulate Big Tech

By Ellen Daniel

The UK government has set out plans for new regulations designed to limit the power of Big Tech and give consumers more control over their data.

According to the plans, a new Digital Markets Unit will be set up under the Competition and Markets Authority (CMA). It will work with regulators such as Ofcom and the Information Commissioner’s Office to establish a new code for online platforms.

The code will apply to companies with “strategic market status”. It’s designed to limit the extent to which companies such as Facebook and Google can dominate their respective markets, helping smaller businesses and news outlets to compete with their larger rivals.

It may require Big Tech companies to be more transparent about their use of consumer data, as well as giving users more choice over personalised advertising. They will also be prevented from placing restrictions on their customers that make it difficult for them to switch to rival platforms.

The Digital Markets Unit will begin work in April and could have the power to suspend, block and reverse decisions made by tech giants, as well as requiring them to take certain actions to achieve compliance and could impose financial penalties for non-compliance.

The code is also designed to help smaller organisations get “fair access” to services such as digital advertising to ensure that online platforms are not applying “unfair terms, conditions or policies to certain business customers”.

When it comes to news publishers, the code will oversee commercial arrangements between publishers and platforms in a move to promote “the sustainability of high-quality online journalism and news publishing”.

This follows a study by the CMA, which found that a lack of competition in digital markets was preventing consumers from accessing new services.

In the context of the EU’s Digital Services Act and ongoing antitrust investigations by the European Commission, plans for a new Digital Markets Unit can be seen as part of ongoing efforts to limit the power of Big Tech. However, in light of the UK’s imminent departure from the EU, some have voiced concerns that such moves could deter major tech organisations from investing in the country.

But Stephen Kelly, chair of Tech Nation believes that the move will create a “healthy environment for tech companies”:

“The government’s latest move to create a healthy environment for tech companies, by setting up a dedicated Digital Markets Unit, is exactly what’s needed in order for the UK to be truly pro-tech, innovative and lead in the digital age. As tech becomes increasingly core at the heart of everyday life, these measures are necessary to ensure that the government and regulators are ahead of the digital change curve, bringing new opportunities to early-stage innovative businesses and greater benefits to consumers.”


Read More: EU hits Amazon with antitrust charges over third-party seller data use.