Apple, Google, and Amazon likely to face fines under new UK competition rules

The UK’s Competition and Markets Authority (CMA) has announced a new bill that could impose multibillion-pound fines on major tech companies, including Apple, for breaching its rules. The legislation aims to promote competition and protect consumers by tackling the “excessive dominance” of tech firms.


UK introduces new bill to regulate tech giants like Apple with multibillion-pound fines

Under the new rules, tech companies that are deemed to have “strategic market status” in key digital services will be required to comply with the CMA’s rules or face significant fines from its Digital Markets Unit (DMU). Only firms with a global turnover above £25 billion or a UK turnover above £1 billion will be in scope, which means Apple, Google, and Amazon are likely to come under this definition.

The DMU will have the power to make such companies more transparent about their app stores and review systems and open up a specific market, depending on the situation. For instance, Apple could be instructed to allow iPhone and iPad users to download apps from alternative app stores. Similarly, Google could be forced to open up its data to rivals.

The legislation will also take aim at “subscription traps,” which are practices that make it difficult for consumers to cancel a contract. Under the new rules, companies would be required to remind consumers when a free trial or low-cost introductory offer is coming to an end and ensure that a contract can be quit in a cost-effective, straightforward way.

If companies fail to abide by the rules set for them, the DMU will have the power to fine them up to 10% of their global turnover and make senior managers personally responsible for ensuring their company complies with the DMU’s requests. For instance, Apple earned $283 billion in revenue for 2022, so any hypothetical fine could be worth up to $28.3 billion.

The new legislation will empower the CMA to enforce consumer law directly and strengthen competition in digital markets. According to the business and trade minister Kevin Hollinrake, “The new laws we’re delivering today will ensure that people across the country keep hold of their hard-earned cash.”

The bill has been in the making since 2021 and will be heard in Parliament on Tuesday. The new measures will come into effect following parliamentary approval, subject to secondary legislation and the publication of guidance.

In conclusion, the new legislation is a significant step towards promoting competition and protecting consumers in the UK’s digital markets. By giving the CMA the power to fine major tech companies for breaching its rules, the UK is sending a strong message to the tech industry that excessive dominance and unfair practices will not be tolerated. The legislation will also ensure that consumers are protected from subscription traps and can make cost-effective, straightforward cancellations of contracts.

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About the Author

Asma is an editor at iThinkDifferent with a strong focus on social media, Apple news, streaming services, guides, mobile gaming, app reviews, and more. When not blogging, Asma loves to play with her cat, draw, and binge on Netflix shows.