A new bill has been introduced today (25 April) that will ensure businesses and consumers are protected from rip-offs and that competition in digital markets is boosted.
Fake reviews that ‘cheat’ customers and subscription traps that cost more than a billion pounds a year will be clamped down on by the Competition and Markets Authority (CMA) which has been given new powers to scrutinise businesses that breach consumer rights law.
The bill will gift the CMA with ‘stronger’ tools to analyse competition problems and take more effective action, including where companies collude to bump-up prices at the expense of UK consumers. As opposed to lengthy court processes, the authority will now be able to directly enforce consumer law.
The government will also be able to ban the publication of fake reviews and also ensure that consumers can exit subscriptions easily, with businesses now required to issue a reminder to consumers when a free trial or introductory offer is coming to an end.
“From abuse of power by tech giants, to fake reviews, scams and rip-offs like being caught in a subscription trap – consumers deserve better,” Business and Trade Minister Kevin Hollinrake said. “The new laws we’re delivering today will empower the CMA to directly enforce consumer law, strengthen competition in digital markets and ensure that people across the country keep hold of their hard-earned cash.”
As part of the bill, a Digital Markets Unit (DMU) within the CMA will also be able to tackle the ‘excessive dominance’ that a small number of tech companies have held over consumers and businesses in the UK.
According to the Department for Business and Trade and the Department for Science, Innovation and Technology, the government’s new digital regime will give the DMU powers to ensure that businesses and consumers are not unfairly disadvantaged by the biggest tech players. The hope is to give all digital companies access to ‘dynamic and thriving digital markets’ that the government believes will ultimately ‘support our economy to grow’.
The news comes a month after Google was slammed by £3.6 billion class action for restricting digital ad competitors.
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The Trade Desk senior vice president EMEA and previous leader of the Global Marketing Group at Facebook, Philippa Snare, notes that governments around the world have been evaluating the dominance of big tech players.
“Whilst the everyday consumer may not be aware of the threat of such dominance, a lot is at stake without a competitive advertising market – from the online content we access for free, to the independent journalism that serves society,” Snare added.
“We must not repeat history by allowing the creation of a frail internet built around the influence of a few too-big-to-fail companies. With today’s proposed legislation, I hope we are embarking on an era where we advance an open internet on a fair, level and competitive playing field that works for consumers and businesses alike.”
