UK needs competition rules for the digital age – report

Many digital services are free, making it difficult for customers to compare what they are paying for them

UK needs competition rules for the digital age – report

A report authored by a Conservative MP has called for a new Competition Act to make the UK’s competition law fit to serve in the digital age.

John Penrose, MP for Weston, Worle and the Villages, said that new regulations could “update and modernise our institutions for the new digital economy”.

He had been tasked with writing an independent report by the Government in September last year, as the country prepares for a post-Brexit age.

His report, published on Tuesday, also recommended that the Competition and Markets Authority (CMA) should work out a way that lets customers easily compare the “price” of free online services.

Many digital companies, such as Google and Facebook, do not charge customers for many of their services. Instead they harvest customers’ data, giving them insights which allows adverts to be targeted with precision.

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The MP also called for more action to help protect consumers, including the introduction of rules which would end the so-called loyalty penalty.

UK consumers are believed to lose around £3.4 billion when they stay with their electricity or phone supplier, among others, on a worse deal than new customers are being offered.

The report also suggested that the CMA should publish a report into the state of competition and consumer detriment in the UK every year.

Business Secretary Kwasi Kwarteng said: “The UK’s competition laws and institutions are highly regarded across the globe, however as we build back better from the pandemic and start life as an independent trading nation, we have a golden opportunity to strengthen that reputation.

“I want to thank John Penrose for his hard work on this independent report, which considers how the UK’s competition regime can promote productivity, reward and encourage innovation and, most importantly, get consumers a better deal.

“We will consider John’s recommendations and respond in due course.”

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