How does the CMA plan to tackle market power in digital markets?

The CMA has set out 11 proposed principles to inform its approach, which can be grouped under 4 broad themes (see table below).

 

Broad themes

CMA’s Proposed Operating Principles

1. Targeted, evidence-based and proportionate approach to implementing the new digital markets regime.

  • Be responsive to market developments and prioritise where the CMA can have the most impact.

2. Promote competition as the route to deliver better outcomes for users.

  • Take direct action to prevent abuse of market power where improved competition alone won’t deliver the necessary changes sufficiently quickly.
  • Intervene in a future-proofed way to avoid creating dependencies on particular technologies or supply chains.

3. Ensure digital markets regime complements CMA’s existing tools, and coordinate with domestic and international partners.

4. Engage widely with a range of stakeholders (from major tech players to challengers and users)

  1. Will tailor its actions to the specific problems it identifies, considering their proportionality and likely effectiveness.  
  2. Will focus its actions where it can have the most impact for people, businesses and the economy. 
  3. Will measure its impact, outcomes and outputs. Will learn from experience and use this to inform future decisions. 
  4. Will stay abreast of developments and seek to deal with harm quickly. 
  5. Will promote competition as the primary lever to deliver better outcomes for users. 
  6. Where steps to improve competition alone will not deliver the outcomes to the extent or pace we seek, the CMA will prevent abuses of market power more directly. 
  7. Will seek to intervene in a technology-neutral way. 
  8. Will ensure the Digital Markets competition regime complements other CMA tools. 
  9. Will engage throughout with a wide range of stakeholders who are affected by or have an interest in its work. 
  10. Will operate with transparency. 
  11. Will work with its domestic and international counterparts to minimise unnecessary duplication. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Some examples of what the CMA states it could do to tackle market power in digital markets and associated harms under the new regime include:

  • Ensuring markets stay open. For example, by (where appropriate and proportionate) preventing SMS firms from engaging in anti-competitive tying, bundling or self-preferencing of products and services, or by mandating SMS firms to provide competitors with greater access to data or functionality controlled by SMS firms.
  • Seeking ways to increase competition in the core platform markets where this is feasible. For example, by (where appropriate and proportionate) requiring SMS firms to allow the products and services of other firms to interoperate with their own, or ensuring SMS firms provide their users with effective choice screens.
  • Tackling misuse of market power more directly where competition does not provide an adequate constraint. For example, by (where appropriate and proportionate) requiring SMS firms to trade on fairer terms or requiring them to increase transparency with respect to aspects of their algorithms.