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UK: Government announces 2021 competition regime with Digital Markets Unit and code of conduct

The Government of the United Kingdom announced, on 27 November 2020, that a new competition regime will be set up to provide consumers with more choice and control over personal data held by market-leading platforms such as Google LLC and Facebook, Inc. which are funded by digital advertising, including the introduction of the Digital Markets Unit ('DMU') within the Competition Markets Authority ('CMA') and a statutory code of conduct. In particular, the DMU will begin activity in April 2021 and could have powers to suspend, block, and reverse decisions made by such platforms, and impose financial penalties for non-compliance with the code. Furthermore, the Government outlined that, although the code and its contents will be discussed in early 2021, it could include requirements for platforms, such as those funded by digital advertising, to be more transparent about their services with users, particularly regarding how consumer data is used, as well as giving consumers a choice about whether to receive personalised advertising, and removing restrictions intended to prevent users from using competitor websites.

In addition, the CMA released, on 27 November 2020, a statement welcoming the new competition regime which follows the CMA's report on online platforms and digital advertising in July 2020, further stating that its Digital Markets Taskforce will be advising the Government on the design of the new regime before the end of 2020.

You can read the press release here and the CMA's statement here.

UPDATE (9 December 2020)

CMA advises government on new competition regime

The CMA issued, on 8 December 2020, advice to government on the design and implementation of the UK's new competition regime for digital markets. In particular, the advice has been produced by the Digital Markets Taskforce ('DMT'), commissioned by the government in March and led by the CMA, working together with Ofcom, the ICO, and the Financial Conduct Authority ('FCA'), and makes 15 recommendations to the government. Specifically, the advice notes that alongside the Strategic Market Status ('SMS') regime which would require firms to be subject to a code of conduct, pro-competitive interventions such as personal data mobility, interoperability, and data access, and SMS merger rules, it is essential that the government strengthens competition and consumer protection laws and processes to ensure they are better adapted for the digital age. Specifically, the advice recommends, among other things, that the government should take action to address unlawful or illegal content, such as fake online reviews and scam advertisements, and to enable effective consumer choice in digital markets, including by addressing instances where choice architecture leads to consumer harm, as well as that it should provide for stronger enforcement of the Platform to Business Regulation. 

You can read the CMA press release here, the DMT press release here, and the advice here.

UPDATE (9 December 2020)

CMA secures privacy changes to the Apple App Store

The CMA announced, on 9 December 2020, that it had succeeded in its effort to improve information available on the use of personal data by apps available in Apple's App Store following an international intervention in collaboration with the Netherlands Authority for Consumers and Markets and the Norwegian Consumer Authority, which follows ongoing work from the International Consumer Protection and Enforcement Network ('ICPEN'). In particular, the CMA noted that consumer protection authorities became concerned that people were not being given clear information on how their personal data would be used before choosing an app, including on whether the app developer would share their personal data with a third party, and that without this information, consumers are unable to compare and choose apps based on how they use personal data.

The CMA further outlined that ensuring consumers are protected in digital markets is a priority, and that safeguarding people's control over their data is important for protecting privacy as well as for the healthy operation of the market. Furthermore, the CMA stated that its market study into online platforms and digital advertising advocated a competitive-neutral approach to implementing privacy regulation, so that the big platforms are not able to exploit privacy regulation to their advantage. Finally, the CMA highlighted that it will be working with the ICO and Ofcom to further to address privacy and consumer protection issues through the Digital Regulation Cooperation Forum.

You can read the Apple Store statement here.