2024 is an important year for the UK's Competition and Markets Authority (CMA): not only is it the regulator's 10th birthday, but 2024 is set to be the year when the CMA will obtain significant new powers under the Digital Markets, Competition and Consumers Bill (DMCC). Last week, the CMA released its annual plan for 2024/2025 and to the surprise of no one (and in line with last year's plan), tech has a significant “market share” when it comes to the CMA's priorities for the year ahead. 

Focus areas for 2024/2025

The central objective of the CMA is to “deliver a positive impact for people, businesses, and UK economy, while ensuring the CMA has the capabilities and expertise required of a 21st century competition and consumer protection authority”. The Annual Plan is tied to this key objective, and identifies six areas of focus: 

  • acting in areas of essential spending and where people are under particular financial pressure, such as accommodation, caring for ourselves and others, and travel;
  • broadening the CMA’s work to protect consumers from harmful practices in online choice architecture and misleading pricing;
  • enabling innovating businesses to access digital markets such as cloud services, e-commerce, and digital advertising;
  • encouraging effective competition and consumer protection in emergent markets, including the development and deployment of AI foundation models;
  • acting in existing and emergent markets for sustainable products and services, including through broadening the CMA’s green claims work, encouraging competitive markets for climate technology, and implementing the Green Agreements Guidance;
  • identifying and acting in areas where the CMA can influence the pro-competitive development of markets and have the most positive impact on innovation, growth and productivity, and promoting resilience through competition.

Tech (still) in centre stage 

Unsurprisingly, tech markets loom large in the CMA's priorities.  Of these six areas of focus, three are directly related to the tech sector, whilst even those that are not solely focused on digital services are tech-adjacent (e.g. the CMA's sustainability agenda has so far seen it take action against a number of online retailers, and includes a focus on climate tech). 

The annual plan details the “progress” the CMA has made in the last year and lists no fewer than seven significant pieces of work the CMA has done in the last year in digital markets, spanning its mergers, markets and competition enforcement functions. 

Plus ça change?

Of course, the tech sector being a focus area for the CMA is not new - indeed many of the "focus areas" are unchanged from last year's plan. What will be new in the CMA's tenth anniversary year is the powers the CMA will have to take enforcement action in the tech sector (and beyond). The DMCC Bill will give significant new powers to the CMA and is expected to receive Royal Assent in the coming months and be in force in the Autumn. The CMA says this will “strengthen the CMA’s ability to foster competition, innovation, and growth in digital markets and to protect consumers from harm.”

Much reporting on the DMCC has focused on the new regime it will introduce for the largest tech businesses. The UK's answer to the EU's Digital Markets Act, known as the Strategic Market Status (SMS) Regime, will give the CMA enormous and largely unfettered power to write and enforce new rules for firms designated as having SMS. 

The CMA's Digital Markets Unit (which has been operating in shadow form since April 2021) will be responsible for administering this regime and has - in the worlds of the CMA's CEO Sarah Cardell - “been preparing for several years to make sure we can hit the ground running”. The CMA's recently published roadmap on how it plans to use its new powers makes this clear. 

While the SMS Regime is hugely significant, it will only apply to a handful of the largest tech companies. The DMCC Bill also gives the CMA significant new powers to enforce consumer law, which the annual plan says will “transform the impact of the consumer enforcement action we take”. The CMA will for the first time have power to find and fine (up to 10% of global turnover for) breaches of consumer law. 

While these changes apply across the economy, the CMA has made no secret of the fact it sees a significant role for them in the tech sector. The CMA has already flagged it sees a role for consumer law in ensuring consumers can make informed choices about their privacy, that they are protected as AI evolves, and of course in relation to how products and services are sold online. 

The ever more complex regulatory web

Tech businesses have known they are in the regulatory spotlight for many years but in 2024, authorities have a broader range of tools than ever before - not just in the hands of the CMA, but of other regulators in the UK (e.g. Ofcom's Online Safety powers) and around the world. 

As the regulatory environment continues to become more complex, with many cross-cutting issues (e.g. around treatment of user data), it is more important than ever that tech businesses have a coherent global regulatory strategy.