Government plans to regulate tech firms will not do enough to secure the UK’s status as a hub for digital companies, businesses have warned.
The Confederation for British Industry (CBI) said proposals laid out in a recent white paper risk falling short of the government’s ambition to create world-leading regulation.
The new laws would see the creation of a new regulator, with powers to fine or even ban internet firms if they fail to protect users against harmful material on their platforms.
The CBI said that while new regulation was vital for rebuilding trust in the digital economy, further clarification was needed.
“While the UK leads its digital competitors, it cannot rest on its laurels. Major regulatory interventions must be internationally workable and sought after by the rest of the world,” said CBI director general Carolyn Fairbairn.
“After speaking to businesses across the country, from startups to multinationals, it’s clear these proposals fall short and can be improved.”
The business group said proposals for a duty of care for tech giants should be focused on illegal harms, while plans to address legal but harmful content needed revision.
The CBI also argued that the new regulator should be embedded within Ofcom, fully independent, and should be funded by both the government and industry.
Fairbairn said effective regulation could pave the way for the UK to become a world leader in internet regulation.
“But done badly, poor regulation will undermine new entrants into the digital economy and dampen UK investment, while having minimal impact on improving public trust,” she added.
The government has now closed its consultation on the online harms white paper.