The DMU (Digital Markets Unit), member of the CMA (Competition and Markets Authority), will soon have the power to impose heavy fines to large technology companies. The newly created UK tech giant regulator could have extensive power to sanction companies whose behavior it deems to be anti-competitive.
The DMU could block certain acquisitions by tech giants
According to the UK Department for Digital, Culture, Media and Sport, the DMU, in charge of digital markets, will soon have the power to impose fines up to 10% of global annual turnover of a company if it does not comply with the country’s regulations. This same unit will also be able to impose daily fines of 5% of turnover for each day the violations continue. With this new legislation, the United Kingdom is equipped with a complete arsenal to enforce digital market laws within its territory.
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The ministry specifies that companies will also have to facilitate the passage from one platform to another, to free themselves from default applications and to better control the sharing of data. The DMU will also have a say in acquisitions. They will precisely have to be reported to the regulator before they are concluded, in order to determine whether a “Further investigation is needed”. The UK does not want to relive the takeover of Giphy by Facebook. Now the regulator could block acquisitions intended to stifle competition. Prevention is better than cure.
The United Kingdom is equipping itself with a complete legal arsenal
The new text also requires tech giants to notify small businesses when changes are made to algorithms. Changes that are likely to harm their business. Google could, for example, be forced notify e-merchants if changes affect their ranking in search engines. For its part, Meta could be required to warn the media if they are less present in the Facebook feed. App makers, on the other hand, can expect “fairer and more transparent conditions” to promote their products.
The UK also plans to emulate Australia and Canada by ensuring that news publishers are compensated fairly for their online content. If the ministry goes to the end of this text, it could lead to sweeping changes for big tech companies. The size of the penalties and the power granted to the DMU could force the big tech companies to fall in line.