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On Tuesday, Britain announced its plans to introduce a new law aimed at curbing the ability of tech giants such as Google, Facebook, and Amazon to stifle competition in digital markets using their considerable power.
In addition to limiting the power of tech giants, the proposed legislation will also provide stronger safeguards for consumers. The government has stated that the new law will make it simpler for consumers to opt out of online subscriptions and address the issue of fake reviews.
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Two years ago, Britain’s antitrust watchdog, the Competition and Markets Authority (CMA), established a Digital Markets Unit, which is equipped with the necessary knowledge to regulate emerging markets, including social media.
Although the Digital Markets Unit (DMU) was established to regulate emerging markets, it has been limited by its lack of legal authority.
However, once passed by Parliament, the new bill will grant the DMU additional powers over tech companies with a global turnover exceeding 25 billion pounds ($31.2 billion) or a British turnover surpassing 1 billion pounds. This will provide the DMU with the necessary “teeth” to enforce its remit.
Despite resistance from Google, Apple, and other major tech companies, the European Union implemented its own legislation last year to combat their dominance.
Under the proposed British law, the Competition and Markets Authority (CMA) will have the authority to establish regulations for tech companies that meet the specified threshold, preventing them from unfairly disadvantaging smaller businesses and consumers.
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The government stated that the tech companies may be required to offer customers greater options and transparency, as an illustration of the regulations that could be implemented.
If the companies violate the regulations, they could be subject to a fine of up to 10% of their global turnover.
Sarah Cardell, the Chief Executive of the CMA, expressed her belief that the bill has the potential to be a significant moment in safeguarding consumers and guaranteeing the effectiveness of digital markets in the UK economy.
She stated “Digital markets offer huge benefits, but only if competition enables businesses of all shapes and sizes the opportunity to succeed. This bill is a legal framework fit for the digital age.”
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