The government should scrap its new Digital Markets, Competitions and Consumers (DMCC) bill because it is already too old, the Centre for Policy Studies (CPS) has warned today.
The report, titled ‘The Unregulated Regulator’, alleges that dynamic digital markets have “outpaced” the new legislation.
What’s more, it would weaken investment and grant the CMA “extensive and unchecked” regulatory powers, which could “undermine” the government’s ambitions of forging the UK into a global science and tech superpower, according to the report.
The DMCC bill is an “expansive blank cheque for the CMA to rewrite digital markets,” Matthew Sinclair, author of the analysis, said.
He said it will harm consumers, “ruin” the UK’s reputation and thwart recent “dynamism” in digital markets.
“There is a huge risk that regulators charge in with draconian restrictions, backed up by big fines, and undermine that innovation,” Sinclair added.
The report says the bill, currently in passage through parliament, hands “vast amounts” of “quasi-legislative” power to unelected officials.
Matthew Feeney, head of tech and innovation at CPS, said the report “offers a much-needed warning” but shows other options the government could pursue.
If they want to avoid scrapping the bill, for example, he suggests they could introduce a competition appeals process or watch to see how the EU digital markets act, which entered into force late last year, plays out.
A department for business and trade spokesperson said: “The UK is the leading country for tech investment and growth in Europe, and the Digital Markets, Competition and Consumers Bill will further drive innovation, boost competition and grow the economy”.
“Under the new digital markets bill they will be required to publish guidance and consult before taking major decisions.”
The CMA is accountable to parliament and to the Competition Appeal Tribunal which has legal expertise.
Rick VanMeter, executive director of the Coalition for App Fairness, told City A.M. that “any suggestion that the DMCC Bill should be scrapped is reckless and ignores the many ways the anticompetitive practices of Apple and Google hurt developers, consumers and the UK economy”.
“Advancing the DMCC Bill is an opportunity for the UK to be a global leader in empowering innovators and small businesses”, he added.
The Coalition for App Fairness represents app developers including Spotify, Epic Games and Match Group, as well as UK start-ups such as Xigxag and Paddle.