New rules against subscription traps and fake reviews

New laws will make it illegal to buy, sell or host fake reviews. The Digital Markets, Competition and Consumer Bill by the UK government aims to boost competition among big tech companies and protect consumers.

On Tuesday, the UK government is introducing the Digital Markets, Competition and Consumer Bill, which prohibits individuals from receiving payment or incentives for writing positive reviews. The goal is to protect consumers and promote fair competition among big tech companies.

The upcoming Digital Markets, Competition and Consumer Bill, set to be introduced on Tuesday, will require firms to remind customers when free trials end and ban the use of fake reviews for monetary gain. The bill also aims to address the current market dominance of big tech firms.

The creators of the bill have stated their aim to regulate the dominance of large tech companies in the market, but have not named any specific companies yet. The selection process will involve up to nine months of investigation.

Regardless of their country of origin, Chinese firms will be included in the scope of the Digital Markets, Competition and Consumer Bill if they are found to be in scope.

After a period of investigation, the newly established Digital Markets Unit, which is part of the Competition and Markets Authority (CMA), will be granted powers to open up a particular market based on the circumstances, regardless of the location of the company.

The Digital Markets Unit, a part of the Competition and Markets Authority, will be given the power to mandate specific market changes, such as requiring Apple to allow users to download apps from different app stores or requiring search engines to share data.

The CMA has the authority to impose fines, based on the severity of the violation, that can reach up to 10% of the company’s global revenue. Additionally, the CMA does not need a court order to enforce consumer protection regulations.

The EU Digital Markets Act aims to address comparable competition concerns related to large technology companies. Meanwhile, the UK legislation covers a broad range of topics, and the CMA’s responsibilities will include addressing the significant global challenge posed by the dominance of big tech firms.

Additionally, the CMA will assist consumers in managing their subscriptions and potentially extending the “cooling off” period, allowing them to cancel after a single payment. Finally, the CMA will ensure that platforms take appropriate measures to verify the authenticity of product and service reviews.

The CMA’s success in compelling Meta, the parent company of Facebook, to divest Giphy following an investigation into potential anti-competitive behavior demonstrates the effectiveness of a UK regulator in regulating primarily US-based technology giants. Despite expressing disappointment, Meta ultimately complied with the ruling.

According to Nick Breen, an attorney at Reed Smith, the expanded authority granted to the CMA by the new legislation implies that no one can afford to treat the matter lightly.

Neil Ross, a representative from the trade association techUK, expressed his desire for the legislation to include a reliable system of checks and balances, as well as an efficient process for appeals.

Kevin Hollinrake, the Business Minister, stated that the legislation being introduced will provide the CMA with the authority to enforce consumer law directly, enhance competition in digital markets, and guarantee that individuals throughout the nation retain their hard-earned money.

Upon receiving parliamentary approval, the Department of Business and Trade has announced its intention to enforce the new regulations as swiftly as possible.

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By Ryan

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