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Changes to Digital Markets Bill introduced to ensure fairer competition in tech industry

The Digital Markets, Competition and Consumers Bill is set to introduce a new targeted and proportionate regulatory regime to address concerns around competition in the digital industry while ensuring that the UK remains one of the best places to invest in and innovate new technology.  

At the heart of the Bill is a new approach to digital market regulation, allowing the Competition and Markets Authority (CMA) to intervene quickly and flexibly to promote competition.

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Amendments to the Bill recently proposed by the Government will maintain the appeals process for all regulatory decisions (except fines) on the basis of judicial review principles. This will mean that eligible tech firms can challenge regulatory decisions on proportionality grounds through this process.

This approach will enable the CMA to encourage the most powerful firms in dynamic digital markets to work with regulators to ensure competition is maintained on an ongoing basis, rather than allowing legal challenges to cause the regime to get bogged down in the courts. This will also act as a further incentive on the CMA to ensure that it is always acting proportionately and exploring the intervention that is most likely to achieve the best outcome for consumers.

Under the Bill, certain firms may also be subject to fines that could reach tens of billions of pounds. To make sure these huge fines are balanced by rigorous checks and balances, these firms will now be able to challenge these decisions “on their merits”. These changes allow firms to challenge fines on the substance of the decision, as well as the process to reach that decision.  

The legislation will also make clear that the regulator cannot impose a conduct requirement or pro-competition intervention on a firm unless it is proportionate to do so and there is a strong evidence base behind the intervention.

These amendments bring the digital markets regime in line with the approach taken for decisions under the CMA’s Mergers and Markets regimes, where the decisions about the level of a fine can be appealed on the merits.

See: Changes to Digital Markets Bill introduced to ensure fairer competition in tech industry – GOV.UK (www.gov.uk)

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