The Competitions and Markets Authority (CMA) is the body responsible for ensuring that businesses compete fairly in the UK. Its main function is monitor companies and take action against those that do not follow the rules. The idea is to try to respect the rules of the free market as much as possible.
Now a new bill has been introduced in the UK which could give this public body the power to impose penalties directly. Until the law is approved, every case must go through a court, and if it is approved, it will no longer be. It will be the administration itself that can impose a sanction “up to 10% of its worldwide turnover”. It’s a lot of money. We see it.
A fine equivalent to the budgets of Ireland
In a statement, the CMA explained that it appreciates this bill, which is still must be approved by the House of Commons (the equivalent of the lower house in any bicameral system, such as the Congress of Deputies in USA).
It’s normal that they like it, since gives the entity much more power than they had before. It gives you the power (or what is called in my field “the prerogative over the Administration”) to sanction without going through a court first.
This does not apply to all businesses, but to those with over £25 billion in global turnover, or £1 billion in the UK. Apple complies with bothTherefore, if this measure is approved, it could be investigated and sanctioned by the CMA itself.
That would be around a third of Apple’s global profits in 2022
Recall that this public entity has already published a report indicating that Apple’s policies regarding the banning of third-party applications were practices contrary to consumers, therefore you may be rubbing your hands right now.
Let’s talk numbers. Apple’s global business volume in 2022 was $393 billion. A 10% fine would be $39.3 billion, or whatever, more than six times the education and vocational training budget of USA in 2022. Not bad at all.
Anyway, it’s still just a draft. It is not approved, and the same is never approved. The political situation in the United Kingdom is tense, and normally in these cases it is not worth approving very drastic measures for fear of public opinion. In any case, if approved, companies like Apple, Google or Amazon could face historic finesand without going to court.
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