ALCS welcomes Digital Markets, Competition and Consumers Bill

The law enables technology companies to be given “strategic market status” (SMS) and be regulated by the Digital Markets Unit (DMU), empowering publishers to reap fair rewards.

The UK passed the legislation on Thursday 23 May in the “wash-up” process following the announcement of a UK general election on 4 July. As a result of this new law, it is possible for the DMU to compel technology companies to pay for the news content on their platforms.

They will also work to establish codes to ensure that companies serve the best interests of consumers. The legislation grants the DMU power to fine technology companies 10% of their annual turnover if they act in a negligent manner. As the bill passed through the House of Lords, Business minister Lord Offord of Garvel said: “This Bill will be vital in driving growth, innovation and productivity and protecting consumers.”

The DMU will be tasked with ensuring technology giants fulfil a number of clear practices, including: trading on fair and reasonable terms; holding effective processes for handling complaints and disputes; providing clear and accessible information about relevant digital activity to users or potential users; providing clear notice and explanation ahead of significant changes related to digital activity that may impact users; and offer users options or default settings in relation to the relevant digital activity, in order for users to make informed decisions in their best interests. Included in the bill are also mandatory merger reporting requirements and pro-competition interventions where necessary.

Calls for a regulatory body

The news has been welcomed by organisations such as the News Media Association, Professional Publishers Association and the National Union of Journalists, who view the Bill as a means of addressing the imbalance between platforms, publishers and journalists.

Earlier this year, ALCS commissioned the Centre for Regulation of the Creative Economy (CREATe) to conduct research on conditions for freelance journalists. The survey revealed that 93% of respondents do not receive any payments from existing licensing agreements for online secondary use, despite annual revenues derived from news content by Google and Facebook combined being estimated at being in the millions.

One of the key recommendations of the report was for the UK Government to install legal measures for compulsory negotiation requirements between digital platforms and press publishers, adding that any mechanism should apply equally to all rightsowners, including journalists as well as publishers. The passing of the Digital Markets, Competition and Consumers Bill will allow the Competition and Markets Authority (CMA) to hold large technology platforms accountable when compensating publishers and writers for their work, as well as encouraging these companies to embrace practices that enable greater competition.

The road ahead

The CMA has proposed a roadmap for administering this new SMS regime. Once agreed, the CMA is expected to conduct 3 to 4 investigations in the first year, with parallel consultation on proposed Conduct Requirements.

Once Royal Assent is granted, we hope to see the CMA address areas where harms have the greatest societal impact, as well as empower publishers to reap fair rewards and establish a more stable and accessible ecosystem for independent UK journalism.

The passage of the Digital Markets Bill offers potential for writers and publishers everywhere to seek fair compensation, while also blocking large technology platforms from enacting discriminatory practices. We look forward to working with publishers and the Government to ensure the process is as fair and transparent as possible.

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