Brace yourself: it's finally here! What has been termed by Sarah Cardell as a potential ‘watershed moment’, yesterday (25 April 2023) the draft Digital Markets, Competition and Consumers Bill (“Bill”) was put before parliament (see link to the statement here). The new Bill aims to enhance consumer rights, crack down on subscriptions traps and fake reviews, enhance the CMA’s powers and boost competition in digital markets.
The Bill will:
The CMA’s press notice provides a flavour of what to expect in the Bill and, in fact, highlights that at least some of the Department for Business, Energy & Industrial Strategy proposals in its response to ‘Reforming Competition and Consumer Policy’ will be included.
Importantly, the new Bill will empower the CMA to decide when consumer law has been breached through a new administrative model and to issue fines directly. This will be a welcomed relief for the CMA, which is currently required to take each case to court if infringements can’t be resolved informally or via undertakings.
On ‘subscription traps’ the new Bill will require businesses to:
On fake reviews, the Bill will allow the Government to prohibit the practices of facilitating fake reviews or failing to take reasonable steps to verify whether reviews are genuine where a business uses consumer reviews in its promotions.
The new Bill bolsters the investigative and enforcement powers of the CMA, meaning faster and more flexible competition investigations. The proposed changes to the competition framework (including updated merger and fine thresholds) will also make it easier for the CMA to act against mergers which harm UK consumers and businesses.
The new Bill establishes a new, targeted regime built for the digital age, overseen by the DMU within the CMA that will use a proportionate approach to tackle the challenges in digital markets. Firms designated as having Strategic Market Status will be subject to:
The new measures are set to come into effect as soon as possible following parliamentary approval, subject to secondary legislation and the publication of guidance. We understand that there is wide cross-party support for the Bill and expect it to receive royal assent; however, given that there may be challenges in the use of the Bill as a vehicle to address numerous other issues, it may take some time for it to pass through the parliamentary process with adoption expected in 2024.
Feb 28 2024
Feb 28 2024