ARTICLE
14 January 2025

CMA Trails Initial Plans For Digital Markets Regime

LS
Lewis Silkin

Contributor

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The CMA has outlined initial plans for the new digital markets competition regime, launched in January 2025. It will designate firms with "Strategic Market Status" (SMS) and implement pro-competition measures to benefit UK consumers and businesses, with investigations starting soon.
United Kingdom Antitrust/Competition Law

The Competition and Markets Authority has (kind of) set out its initial plans for the new digital markets competition regime.

As our readers know, the Digital Markets, Competition and Consumers Act 2024 received Royal Assent in May 2024 and the digital markets competition regime came into force on 1 January 2025.

The CMA published guidance on the digital markets regime on 19 December 2024.

Under the digital markets competition regime, the CMA may designate firms with "Strategic Market Status" (SMS) in relation to a particular digital activity. Once designated, the CMA can impose conduct requirements or introduce pro-competition interventions to achieve positive outcomes for UK consumers and businesses.

The CMA has provided an outline of its planned activity for the first six months, including the expected launch of SMS designation investigations in relation to two areas of digital activity in January. It says that it will make more detailed announcements on these later in the month. A third investigation will follow around June of this year.

The CMA must complete each designation investigation within a statutory time limit of nine months. The CMA expects to consult on an initial set of proposed conduct requirements in parallel with these investigations.

The CMA also plans to provide more information about how individual designations may improve outcomes for businesses and consumers as it launches its investigations. This could include:

  • Preventing large firms from 'preferencing' their own services or using their access to customer data to give themselves an unfair advantage, shutting out smaller competing businesses.
  • Making it easier for people to switch digital service providers without losing access to data or content.
  • Ensuring businesses that depend on major digital ecosystems can access the data and functionality they need to innovate, and to bring to market new products and services.
  • Stimulating more investment and innovation, and so drive growth, by enabling more effective competition - both between different SMS firms and with the many smaller UK businesses that compete with them.

Representatives of the CMA are appearing before the House of Lords Communications and Digital Committee today (8 January 2025) to answer questions about the new regime. This is probably the reason for this slightly vague update. But watch this space for more information - we should have more clarity on the initial investigations by the end of the month.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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