In response to today’s announcement of the UK government’s Digital Markets, Competition and Consumers Bill,[1] James Rosewell, co-founder of digital competition advocacy group the Movement for an Open Web, said:
“This bill has a glaring loophole that risks allowing the platforms to behave with impunity in crushing their competitors using their monopoly power. The legislation has the right objectives but could give the platforms a ‘get out of jail free’ card whilst not giving the regulator the ability to act decisively when it wants to intervene.
“The ‘Countervailing Benefits Exemption’ introduces a loophole that will give the platforms free hand to abuse their monopoly positions and this needs to be closed if we’re to create a competitive market.
“Meanwhile, it’s imperative that the DMU be given the same power as their equivalents in the US, Australia and New Zealand to take cases rapidly to court in the name of the crown, rather than relying on the convoluted statutory route which could delay interventions for months.”
MOW’s specific comments on the Bill include:
- Countervailing benefits exemption (Section 29). This clause offers the platforms a loophole by which their anti-competitive actions can be excluded from the regulations by claiming a consumer benefit. The very dominance of the platforms means that they can ‘prove’ consumer benefits even when their actions will harm competitors and small businesses. The platforms have large and expert legal teams with a lot of experience and success in circumventing legislation through the use of this type of loophole. This approach will effectively create a looser and less strict regime than under the current system, which is clearly not the goal of the legislation.
- The Need for Speed (Sections 31 and 32). We agree with Government that Digital Markets should be regulated at internet speed. The current administrative process is too slow, taking months to move from a complaint to action. The DMU should be given the legal power to secure injunctions under the High Court timetable, enabling them to stop anti-competitive activities in days. These powers are granted to competition authorities in jurisdictions such as the USA and Australia so why not give the DMU Attorney General powers to take public interest litigation in the name of the Crown and speed up enforcement?
- Payment for content and freedom to compete. The tech platforms transparently profit from the efforts of content creators, from song writers and artists through to publishers and record labels. At present, platforms are monopoly distributors and everyone is accessing content over them but the platforms are keeping most of the money. The bill needs to make clear that platforms profit from content and need to pay properly and fairly, on benchmarked terms and with reference to value for end users. Content creators have been identified in previous CMA reports as needing urgent help: they need to specifically be helped by the legislation.
- Interoperability. To avoid platform dependency, data access and technical interoperability provisions should also be incorporated into the legislation. Without them, publishers will be unable to access valuable customer information necessary for advertising in their own right so they can compete freely.
[1] See https://publications.parliament.uk/pa/bills/cbill/58-03/0294/220294.pdf