Britain is at risk of becoming a “regulator” of Brussels after the government chose not to give powers to the competition regulator to establish codes of conduct for large Internet groups such as Google and Facebook. warned the outgoing executive director.
Laws to enable a technology regulator within the Competition Authority and markets were left out of the Queen’s speech, putting the UK behind Brussels, which this year launched a package of historic rules to curb the domain of Big Tech.
While the UK is now outside the EU and setting its own rules, Andrea Coscelli said that in practice companies were already investing in complying with the laws set by Brussels, making it difficult for UK diverges later due to “undue cost” corporations.
“As a country, we are in a great position to establish smart, business-friendly and pro-competition rules in some of these areas. If we don’t, in practice we become one that takes the rules for the cost of divergence, “he said in an interview with the Financial Times.
“He. . . the frustration is that we were [initially] ahead of European legislation[in drafting the rules]. . . now we are behind ”.
The Digital Markets Unit was created in the form of a shadow last year, but cannot set tailor-made standards for technology companies without legislation. Coscelli said his 70 employees would focus on his existing set of tools and probes, such as an investigation into Google’s app store rules and the Apple and Meta cases.
Coscelli, who continues in late July, has overseen high-profile investigations during his six-year term, including probes into major pharmaceutical groups that resulted in £ 1 million fines and a £ 8 million payment to the NHS.
But he acknowledged that the CMA had “underestimated” the complexity of its growing post-Brexit workload. The watchdog took on a series of complicated merger investigations that he once managed in Brussels as part of a strengthened role.
It has grown from 600 to 900 staff members and has taken on new responsibilities, such as an internal market office that assesses the smooth running of trade in the UK and the control of subsidies, which replaced state aid EU.
“We’ve probably underestimated just the size and complexity of some of them [merger] cases, “Coscelli said.” For example, something like that [chipmaker Nvidia’s controversial takeover of Arm], which is probably bigger and more complicated than almost anything we did before Brexit. Now we have six or seven cases like this at any given time. “
The CMA has a wide latitude to intervene in mergers due to the flexible evidence it uses to determine whether it has jurisdiction. But the watchdog has called for more powers to avoid so-called killer acquisitions in which a dominant technology company buys a nascent competitor.
“We’re concerned that these companies are so big and powerful that many of their acquisitions are a problem,” Coscelli said. “We are concerned that in five years’ time we will look back and say that we have only intervened in three cases and maybe we should have looked at 15.”
The government has said it will give the watchdog the power to intervene in killer acquisitions as part of a long-awaited toolkit to increase its effectiveness and execution capacity, elements of which have been promised since 2019.
The tools would give the CMA the power to decide for itself when a company has violated consumer law and to issue fines without getting stuck in court.
Coscelli says this would have allowed the watchdog to do “twice or three times as much” work during the Covid-19 crisis, when his dedicated task force filed thousands of complaints each week and intervened in the markets. , from PCR testing to vacation packages.
The outgoing CEO plans to return to the private sector and will hand over the post to General Councilor Sarah Cardell, who was appointed interim executive director on Friday. His appointment comes after the selection of a new chairman, former Boston Consulting Group senior partner Marcus Bokkerink. He replaced Andrew Tyrie, a Conservative politician, who was fired in 2020 after a clash in the boardroom.
Coscelli said “there is a question about the appointment of former politicians as independent regulators.”
“It simply came to our notice then [the agencies] they are close to the government. . .[But]there is a counter-argument that these bodies really need to be quite independent and technocratic, “he said.
He added: “Someone like Marcus who has no political experience but extensive business experience is the ideal candidate.”