The U.K.’s Competition and Markets Authority (CMA) has presented its plans for the forthcoming digital markets competition regime, designed to curb the unfair advantages held by large tech companies. Responding to a request from U.K. government ministers, the CMA’s document outlines its approach to implementing the proposed Digital Markets, Competition and Consumers Bill. The regime will apply to firms designated as having Strategic Market Status (SMS), which involves substantial market power, strategic significance, and a specified turnover threshold. The CMA expects to evaluate three or four companies for SMS status within a year of the regime taking effect, imposing conduct requirements if abuse of position is identified.
Companies designated with SMS will be subject to certain conduct requirements, preventing preferences for their products and services, providing competitors with greater data and functionality access, and ensuring compatibility with other firms’ products. Transparency around algorithms and fairer trading terms may also be mandated. The CMA plans to engage with stakeholders, including major tech players, challengers, and users, through consulting groups representing consumers, businesses, and tech professionals. Detailed draft guidance for consultation will be released once the bill is passed, with the consumer elements expected to become law by the end of the year.
The CMA has been actively using its regulatory powers over major tech companies, challenging Microsoft’s acquisitions and gaining commitments from Amazon and Meta. The commitments include restrictions on Amazon’s use of third-party sellers’ data and Meta’s assurance not to exploit advertising customers’ data for unfair advantages.
