Tech giants such as Google, Facebook, or Apple could face fines of up to 10 percent of their global turnover if they fail to comply with proposed pro-competition rules, the UK government said on Thursday.
The Department for Digital, Culture, Media, and Sport (DCMS) confirmed that the Digital Markets Unit (DMU)—the UK’s dedicated competition watchdog for online platforms—will be given statutory powers to enforce the “fair-play” rules.
But the department didn’t provide a timeline for the proposed legislation, saying it will be introduced “in due course.”
According to the DCMS, “new tailored codes” will be introduced to regulate “the handful of firms dominating digital markets.”
Digital Minister Chris Philp said the government wants to level the digital playing field.
“Technology has revolutionised the way thousands of UK firms do business—helping them reach new customers and putting a range of instant online services at people’s fingertips. But the dominance of a few tech giants is crowding out competition and stifling innovation,” Philp said.
“We want to level the playing field and we are arming this new tech regulator with a range of powers to generate lower prices, better choice, and more control for consumers while backing content creators, innovators, and publishers, including in our vital news industry.”
The DCMS said the proposals aim to make it easier for people to switch between Apple iOS and Android phones or between social media accounts without losing their data and messages.
With tech firms prohibited from limiting consumers to pre-installed software on their devices, people could also get more choice of which search engines and social media platforms they have access to, the department said.
It also said people will gain more control over how their data is used by companies by being able to opt out of targeted personalised adverts.
Other measures include requiring tech giants to warn smaller firms about changes to their algorithms that drive traffic and revenues and giving the DMU power to arbitrate in pricing disputes between news outlets and platforms to ensure news publications can monetise their online news content and be paid fairly for it.
App developers would also be able to sell their apps on fairer and more transparent terms, the DCMS said.
Failure to comply with the new rules will result in fines of up to 10 percent of a firm’s global turnover and “tough penalties” for senior tech bosses, the DCMS said.
Andrea Coscelli, Chief Executive of the Competition and Markets Authority (CMA), said the CMA welcomes the proposals and “stands ready to assist the government to ensure that legislation can be brought forward as quickly as possible, so consumers and businesses can benefit.”
The DMU, launched in April 2021 within the CMA, was set up to be the UK’s post-Brexit regulator to curb Big Tech domination and promote competition. It has been operating in a “‘shadow’ non-statutory form,” pending legislation to grant it its full powers.
The government’s confirmation that the DMU will get its statutory powers came after The Financial Times reported that a bill to secure statutory underpinning for the watchdog would be missing from the upcoming Queen’s Speech on May 10, which sets out the government’s legislative agenda for the 2022–23 session of Parliament.