Posted: 18/06/2024
The long-awaited Digital Markets, Competition and Consumers Act (DMCC Act) received royal assent on 24 May 2024, as part of the wash-up process following Rishi Sunak’s announcement of a snap UK general election on 4 July 2024.
The DMCC Act has been over a year in the making, with the bill originally introduced to Parliament in April 2023. Touted as the 'bill to stamp out unfair practices and promote competition in digital markets', the DMCC Act enhances the Competition and Markets Authority’s (CMA) ability to promote competition and protect consumers.
The DMCC Act has three areas of focus: consumer protection, digital markets, and competition.
From a consumer protection perspective, the DMCC Act addresses drip pricing, fake reviews, subscription traps, secondary ticketing, and online interface orders.
In the context of drip pricing, the DMCC Act requires that consumers are informed, prior to contract, of the total costs they will have to incur, including fees, taxes, charges or other payments, and also any charges they may choose to incur, such as freight, delivery or postal fees.
The DMCC Act tackles fake reviews by expanding the list of banned commercial practices to include:
The DMCC Act also introduces a subscription regime which requires businesses to provide customers with pre-contract information, provide reminder notices before initial periods come to an end, and ensure that customers can end the subscription in a ‘straightforward’ way. The latter is a change from the earlier proposal that traders had to enable a consumer to end a subscription in a ‘single communication’. This makes it easier for consumers to end a subscription.
Perhaps most topical, in light of recent concerns in the public forum regarding the sale of tickets, either fake or illegally obtained, in the secondary ticket market, the DMCC Act adds a new chapter 5 to the Consumer Rights Act to impose additional enforcement provisions to existing rules and regulations on secondary ticket sales.
It is also worth noting that the power to apply to the court for an online interface order has been extended to any public designated enforcer, such as the Financial Conduct Authority or the Information Commissioner, in addition to the CMA as originally drafted. An online interface order can direct a person to take certain actions, for example, to remove content from a website, app or other digital platform, or to display a warning notice to consumers.
The CMA will now be able to directly enforce consumer protection laws without having to take individual cases to court, with the power to impose fines of up to 10% of a company’s global turnover for breaches of consumer law.
The DMCC Act also establishes a new pro-competition regime for digital markets by introducing the ‘Strategic Market Status’ (SMS) regime for big tech companies. It enables the CMA to impose obligations on designated SMS undertakings, such as mandatory merger reporting and compliance with tailored codes of conduct.
The CMA will be able to impose pro-competition interventions on designated SMS undertakings if the CMA finds that a factor, or combination of factors, relating to a digital activity is having an adverse effect on competition.
In addition to increasing the target turnover threshold (from £70 million to £100 million), the DMCC Act adds a new power enabling the CMA to look at merger instances where at least one party has a share of supply of goods or services of 33%, and a turnover of £350 million. This is intended to prevent the so called ‘killer acquisition’, particularly by firms which have been designated SMS firms.
The DMCC Act also strengthens the CMA’s investigatory and enforcement powers. For example, the Chapter 1 prohibition contained in the Competition Act 1998 covering anti-competitive agreements has been amended to apply to agreements outside of the UK which are ‘likely to have an immediate, substantial and foreseeable effect on trade within the UK’.
This new wording is intended to ensure that businesses and consumers based in the UK are protected from the detrimental effects of anticompetitive conduct, regardless of where that conduct takes place, even when an agreement is implemented in another jurisdiction. The DMCC also provides for co-operation with overseas regulators.
It is expected that most of the DMCC Act will come into force in the autumn of 2024. However, many provisions will be brought into force by secondary legislation, so the exact timetable will be up to the next government.
In the meantime, consumer-facing businesses and big tech companies need to get ready for the application of the DMCC Act by reviewing their existing compliance, especially in light of the increased sanctions. Businesses that sell subscriptions to consumers should consider the new requirements for online sales due to the change in processes mentioned above.
The CMA has opened consultations on the following proposed guidance:
The consultation closes on 12 July 2024.
If you have any queries or concerns, please do get in touch with the authors of this article, or your usual contact at Penningtons Manches Cooper. For a more detailed overview of the provisions on subscription contracts, subject to the above amendments, read our article here.
This article was co-written with Amelia Johnson, trainee solicitor in the commercial, IP and IT team.
© 2024 Penningtons Manches Cooper LLP.
All rights reserved.
Website design by Frontmedia / Dynamic Pear
Penningtons Manches Cooper LLP is a limited liability partnership registered in England and Wales with registered number OC311575 and is authorised and regulated by the Solicitors Regulation Authority under number 419867.
Return to news headlines 
