Computer & Communication Industry Association
PublishedJanuary 26, 2024

Proposed UK Tech Regulations under DMCC Could Cost Consumers up to £160 Billion, New Research Finds

Washington – New research from Europe Economics, commissioned by CCIA, analyzes the potential economic impact of the UK’s proposed Digital Markets, Competition, and Consumers Bill (DMCC) currently being considered in the Lords. It finds that the legislation could impose large costs with UK consumers and businesses receiving worse services and the UK becoming a less attractive destination for investment.

The report demonstrates that, particularly without proper procedural checks and balances (including those introduced by the Government through amendments in the Commons), premature or overly broad regulation could delay the introduction of new services and deter investment in new digital networks. It provides a high level estimate of these costs, providing an indicative estimate for impacts not quantified in the Impact Assessment, and suggests a shocking potential scale of impact on consumers and investment in new digital services:

  • £55bn-£160bn net present value impact on consumer welfare resulting from delays over 10 years, reaching £8bn-£35bn a year by year 10; and
  • a loss in investment in digital services of 4% to 8%.

The report argues that appropriate amendments can mitigate those costs by promoting restraint in the CMA’s implementation including ensuring that consumer impacts are fully-considered at each stage of the process, allowing greater consideration of merits in appeals and managing the extent of conduct requirements.

The Computer & Communications Industry Association has advocated for tech policy that advances competition and innovation for over 50 years.

The following can be attributed to CCIA UK Senior Director Matthew Sinclair:

“The new digital markets bill risks undermining the interests of UK consumers and businesses, who have benefited so much from access to cutting edge digital services. Without the right checks and balances in place, we risk premature or overly-broad regulation that would deter investment and create all kinds of practical obstacles to innovation. The new bill could undermine the dynamism that digital markets have shown in recent years by making it harder for technology companies to launch new networks, or improve the services consumers already know and love. Policymakers need to consider these risks carefully and ensure that the right amendments are in place so the UK does not give up its hard-won reputation for careful and proportionate regulation.”

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