The UK’s Competition and Markets Authority (CMA) has announced plans for action as part of UK's the new digital markets competition regime.
Under the Digital Markets, Competition, and Consumers Act (DMCCA), which came into force on 1 January, the CMA will designate large organizations that hold a significant influence over a specific market with ‘Strategic Market Status’ (SMS).
The CMA can require SMS-labelled firms to meet specific conduct requirements to enhance competition for UK consumers and businesses.
The new regime could, for example, prevent large firms from preferencing their own services or from utilizing customer data to an unfair advantage.
As part of its announcement, the CMA stated it will launch investigations into two areas of digital in the coming weeks under the new regime, likely to refer to Apple and Google’s mobile ecosystems.
This follows a November 2024 report by the CMA’s independent inquiry group, which suggested that the CMS designate both firms with SMS in March 2025, for preventing effective competition and innovation in their respective spaces.
Designations under the plans could also make it easier for people to switch digital service providers, or they could stimulate market investment by creating enhanced competition between SMS firms and smaller UK businesses.
It then expects to launch another investigation into a third area of digital activity after a short pause, likely towards the end of the first six months of the new regime. Conducting the investigations in this manner allows the CMA to manage its resources effectively, the regulator said.
The new regime will bolster investment and innovation from the largest digital firms whilst ensuring an even playing field for the many start-ups and small businesses in the UK, CMA CEO Sarah Cardell said.
“It will ensure that the multitude of UK businesses and consumers who depend on these large firms for critical products and services benefit from more innovation, more choice, and more competitive prices,” Cardell said.
“The regime has been carefully designed to ensure that the UK keeps pace with future developments and maximizes its international attractiveness to innovators and investors in these dynamic markets,” she added.
She also stated that the CMA will be focused on delivering the regime in a way that is predictable and proportionate, with the outlined timeline of investigations helping to ensure the former.
This new regime comes into play following the introduction of the DMCCA which received royal assent in May 2024.
Both the DMCCA and this new regime align the UK’s digital markets regulation with Europe, which introduced the Digital Markets Act (DMA) in July 2022.
