Large technology firms could be fined up to 10% of their global turnover if their practices are deemed to be anti-competitive, under new UK rules.
The UK's new Digital Markets Unit (DMU) will also have the power to hand out additional penalties of 5% of a company's daily global turnover for every day that a tech firm fails to comply with the new rules.
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The regulator has been created to clamp down on "predatory practices" with regard to anti competitive takeovers of smaller businesses and unfair customer practices. However, despite further explanation of what powers the regulator will have, it's still unclear when these changes will come into effect, with the government suggesting the necessary legislation will be introduced "in due course".
Under the proposals, the DMU will be able to designate some of the world's most powerful firms with "strategic market status". This will apply to a handful of large firms that dominate the tech industry with a new "tailored" code of conduct to determine how they treat their users and other, smaller companies.
A large part of the proposals is about ensuring fairness for consumers and transparency around their use of digital services. The DMU will be able to put a stop to companies limiting consumers to pre-installed software on the devices they sell; so a company like Google wouldn't be allowed to force Android users to have the Google search engine app as the default, for example.
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The DMU will also look at the root causes of market dominance and will have the potential to intervene by forcing firms with strategic market status to share more data with smaller competitors. This, it is hoped, could help SMBs overcome the advantages that larger firms have.
The proposals were welcomed by the chief executive of the Competitions and Markets Authority, Andrea Coscelli, who praised the government for taking on a number of the regulator's recommendations.
"The CMA stands ready to assist the government to ensure that legislation can be brought forward as quickly as possible, so consumers and businesses can benefit," Coscelli said.
