Digital Markets, Competition and Consumers Bill

Kevin Hollinrake Excerpts

Tuesday 25th April 2023 Written Statements

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

Today, the Government are introducing the Digital Markets, Competition and Consumers Bill. The Bill will drive growth, innovation and productivity, ensuring that businesses and consumers in the UK reap the benefits of competitive markets. The Bill will:

boost innovation by increasing competition in digital markets, taking action against a small number of the most powerful tech companies that force businesses and consumers to sign up to unfair terms and pay inflated prices;

grow the economy by enhancing our wider competition regime to focus it on the areas of greatest harm, delivering a level playing field for businesses; and

protect consumers by strengthening the enforcement of consumer protection law and introducing new consumer rights, for example tackling subscription traps that currently set consumers back £1.6 billion a year.

Digital technologies have transformed the way we buy products and services, increasing accessibility, flexibility and choice, but we need to act now to address their potential for consumer harm. For instance, companies can make it unreasonably difficult for consumers to cancel a subscription, or inhibit choice by artificially ranking their own products higher in search results.

The Bill will give consumers greater choice and drive innovation, leading to new products that transform lives. It will also establish new, faster tools to address the unique barriers to competition in digital markets, allowing the Competition and Markets Authority to proactively drive more dynamic markets and prevent harmful practices such as making it difficult to switch between operating systems.

We are using the freedoms we have gained by leaving the EU to address these issues in a way that best works for the UK. We can now make our own decisions on how we maintain a proportionate system of regulation that drives innovation and protects consumers. Our new pro-competition regime, focused on the most powerful tech companies, is flexible and principles-based rather than following the EU Digital Markets Act’s blanket set of obligations on all “gatekeepers”, which risks creating unnecessary regulatory burdens for firms. Our more targeted and pro-innovation approach involves investigating specific harms, developing tailored obligations and taking more evidence-based regulatory decisions—informed by significant engagement with the firms themselves. We are also taking a power to ban unfair commercial practices, such as fake reviews, and are strengthening oversight of alternative dispute resolution services that would have been more constrained while in the EU.

The Bill will also support consumers through new and improved rights to deal with bad business practices such as subscription traps. This includes better information up front as well as easier exiting and earlier cancellation rights. These and other new measures will save consumers’ hard-earned cash and protect them from scams and rip-offs. We expect the Bill’s enforcement reforms to increase consumer benefits by tens of millions of pounds above the CMA’s current estimate of £146.5 million a year.

The Bill will grow the economy by boosting competition, better placing UK businesses to succeed in export markets. It will allow the CMA to more effectively deter, prevent and, where necessary, enforce against monopolistic behaviours, to ensure that the free market can operate effectively.

[HCWS737]