Following the "Amazon tax", the UK set up a digital market department to fight against technology giants

Foreign media reported that the UK established the Digital Markets Unit ( DMU) yesterday to address the problem of " abuse of market dominance by large technology giants ."

DMU aims to regulate tech giants like Amazon, Facebook

The DMU was set up by the Competition and Markets Authority (CMA) after the CMA determined that Google had significant market power in search and search advertising, while Facebook had a similar position in social media and display advertising .

The dominance of the market by a few large tech companies is leading to less innovation, higher advertising prices, and less choice and control for consumers.

Oliver Dowden, the UK's secretary of state for digital , culture and media, said Amazon , Facebook and Google would be "under the microscope" from today . He said the new body would take action to tackle "potential abuse of their market position " by some of the tech giants .

The government has said the DMU has the power to reverse decisions made by big tech companies and order them to comply with codes of conduct. So the regulator's role will be to introduce regulation for Silicon Valley's big tech brands, create a level playing field for smaller businesses and give people more control over their data .

Currently, the Digital Marketing Department has been launched, and it will first study the relationship between the platform and content providers, and the platform and digital advertisers.

Although DMU has been established, it has no "real power"

However, regulators are unlikely to be able to enforce any new rules to cut down big tech companies as any code of conduct would need to be approved by parliament .

The combination of the pandemic, Brexit and the Online Harms Bill has led to a long backlog of legal rules that need to be approved by Parliament , meaning the DMU could be without powers for some time.

The British parliament has become increasingly wary of the influence of big companies in international markets in recent days after British Chancellor Rishi Sunak vowed to impose an "Amazon tax" on the e-commerce giant .

Damien Geradin, competition partner at Geradin Partners, said: “The government is committed to regulating digital platforms and has decided that the DMUs should go ahead. But for the DMUs to start adopting codes of conduct and implementing interventions against tech companies, they will need new powers.”

The CMA will take time to look at how big tech regulations would work in practice until the DMUs have the power to implement them.

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Digital Marketing Department