UK Competition Watchdog Vows no ‘Blanket Rules’ for Big Tech Regulation

Key Takeaways

• The U.K.’s Digital Markets, Competition and Consumers Act is designed to rein in Big Tech’s anticompetitive behavior.
• The Competition and Markets Authority (CMA) has signaled that it will take a dynamic approach to enforcement.
• CMA Chief Strategy Officer Jessica Lennard recently called for “a tailored, bespoke approach to identifying and addressing specific harms.”

When Parliament passed the Digital Markets, Competition and Consumers Act (DMCCA ) in May, it signaled the start of a new era of Big Tech regulation in the U.K.

Now, as details of how the Competition and Markets Authority (CMA) intends to enforce the regulation emerge, Chief Strategy Officer Jessica Lennard has made it clear that the legislation won’t be used as a blunt weapon against Big Tech firms.

What Is the DMCCA?

Like the EU’s Digital Markets Act (DMA), the DMCCA is designed to prevent the monopolization of digital technology markets.

It establishes a new regulatory framework aimed at ensuring fair competition and consumer protection, specifically targeting firms that meet the criteria for “strategic market status” (SMS), akin to the DMA’s “designated gatekeepers.”

However, although they share the same goal, the respective regulatory regimes diverge in their treatment of the newly designated Big Tech gatekeepers.

Jessica Lennard Highlights “Bespoke” Approach to Big Tech Regulation

In a speech  on Nov. 19, Lennard underscored the CMA’s commitment to a dynamic regulatory model for Big Tech.

She suggested that while the DMCCA equips the CMA with robust tools to address anti-competitive behavior, it does not mandate a one-size-fits-all approach.

“Rather than blanket rules,” Lennard called for “a tailored, bespoke approach to identifying and addressing specific harms.”

“If the U.K. is to keep pace with the future,” and realize its ambitions for global technology leadership, it will require “companies of all shapes and sizes,” she emphasized.

“Working with the companies themselves – and broader stakeholders from the digital ecosystem in an iterative, participative process including small businesses, challengers and innovators as well as academics and consumer groups.”

U.K. vs. EU Regulation

The U.K.’s approach to regulating Big Tech contrasts with the EU’s more legalistic framework.

While the DMA lays out strict obligations for designated gatekeepers, the DMCCA leaves room for the CMA to adapt its enforcement strategies to specific circumstances. This reflects the U.K.’s broader tradition of nimble regulation, often lauded for its ability to respond to innovation without stifling it.

By only focusing on specific harms such as potentially unfair pricing in the cloud market, the CMA hopes to curb Big Tech market abuse without imposing an excessive regulatory burden that could stifle growth and innovation.

As Lennard put it:

“We’re fully supportive of the important role to be played by the largest firms.” But at the same time, “it’s also our job to enhance and protect opportunities for the challengers, start-ups [and] scale-ups.”