UK to introduce legislation to create new regulator for Big Tech

The British government will introduce legislation in the next few days that will establish a new regulator for the surveillance of technology giants such as Google and Amazon.

According to sources familiar with the plan, the draft bill would give the Digital Markets Unit within the Competition and Markets Authority (the main UK competition watchdog) a legal basis and regulatory powers that specifically target so-called Big Tech firms.

Three years ago, the UK pledged to create a watchdog that would address the increasing power of Big Tech. However, the UK has yet to pass legislation despite the establishment of the digital markets unit by 2021.

According to the details of the legislation, also known as the Digital Markets, Competition and Consumers Bill, the new regulator is going to target a few tech companies that generate at least £25bn of global turnover, or £1bn of UK turnover, with tailored regulations.

As part of the new regime, which was first introduced in the year 2020, only companies that have a stronghold in at least one market digital will be targeted. Those found to be in violation of the rules may face fines up to 10% of their global turnover.

Two officials said that the bill would be published in the week starting April 24. The government refused to comment on an exact date but confirmed that a bill would be presented to parliament shortly.

In addition, the rules will require that each company nominates a senior person to be responsible for the compliance of this new regime. If a company fails to provide the information requested by the regulator, it can also fine its executives.

The standard procedure for appealing the CMA’s rulings would be to seek a judicial appeal. This requirement will frustrate big tech companies who were pushing for a lighter burden of proof in adjudication.

This bill will bring an end to the limbo that has been experienced by the Digital Markets Unit, which was created two years ago with no additional powers than those already available through the CMA. The unit has 70 employees.

The UK led the global effort to combat the dominance by the largest technology groups. Last year, the government abandoned plans to pass legislation.

Other jurisdictions have surpassed the EU in terms of technological advancement. Last year, in Brussels enacted new rules to regulate Big Tech.

Tom Smith, a partner in the law firm Geradin Partners who specializes in antitrust, stated: “If successfully implemented, this new regime will remove some of artificial restrictions imposed on the Big Tech platforms, and allow more tech businesses grow. But there is still a lot to do to ensure that the new rules accomplish that.”

He stated that the bill “was not intended to hinder Big Tech’s innovation but rather to ensure other businesses could also thrive in a modern economy, where the access to customers is controlled by large operators of search engines, app stores and ecommerce platforms”.

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