Investigating the UK Digital Markets Regime: Is the DMCC Bill Fit for purpose?

Authored by: Orestis PrionidisGriffin HallCharlene PangBen RuthManesha SundarRiver Wijaya.

Published 2 months(s) ago.


The UK’s new ‘Digital Market Regime’ is a controversial proposal that includes the creation of the Digital Markets Unit (DMU) under the Competition Markets Authority (CMA), as well as the formation of the Digital Markets, Competition and Consumers Bill (DMCC) which aims to ensure “Free and rigorous competition amongst businesses.” While this bill sounds like a good step towards ensuring healthy competition within a rapidly growing and dynamic industry, its language and guiding principles for identifying anticompetitive behaviour create three concerns that we address. The first of these relates to Ex Ante regulation which, while useful in preventing market misconduct from occurring, we find problematic when applied to digital markets, as the regulatory strategy is likely to become outdated within such a dynamic industry. Our second concern arises from a closer inspection of the bill itself as its over-expansive definitions of digital activity and market power create a climate of ambiguity, both for the DMU and prospective firms vying for eligibility. Thirdly, we find that a lack of procedural safeguards and accountability measures in place could undermine existing laws and the rights of SMS firms which, given the loose regulatory definitions, can happen. Yet, despite these faults, the bill can be fixed, and as such, we conduct a comparative study of both the Digital Markets Regime and the EU’s Digital Markets Act (DMA) to suggest how the proposed legislation can be adapted to limit government failure when intervening in digital markets.

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