U.K. ministers ditch plans to empower tech regulator

‘A HAMMER BLOW’

LONDON • The U.K. is poised to shelve plans to empower a new technology regulator, in a blow to global efforts to curb the dominance of internet companies, including Google and Facebook.

The government's new legislative program is not expected to include a bill to provide statutory underpinning to the digital markets unit that is based within the Competition and Markets Authority (CMA), said people briefed on the situation.

Without the legislation the U.K. tech regulator will not be able to set rules for leading internet companies and impose fines on them for breaking those rules.

The government announced plans to set up the digital markets unit in 2020 and said it would be given powers to devise codes of conduct for tech companies and fine those that did not comply up to 10 per cent of annual turnover.

The unit was established in `shadow form' last year and is operating with around 60 staff, but has no powers beyond the CMA's existing capabilities.

The Queen's Speech due on May 10, which will outline the government's legislative program for the coming year, is not expected to include a bill that would provide the unit with statutory powers.

It comes after the government dropped a bill from the Queen's Speech on long-delayed reform to audit and corporate governance following several corporate scandals.

Tory officials said Boris Johnson was going cold on state intervention in the economy. David Canzini, the prime minister's deputy chief of staff, has told colleagues to scale back their legislative demands. “He's told us that Conservative governments don't legislate their way to prosperity and growth,” said one Conservative official.

Julian Knight, Tory chair of the Commons digital, culture, media and sport committee, said if legislation to empower the tech regulator was not in the Queen's Speech it would “damage the credibility of the whole enterprise”.

“It would be a hammer blow to the capability of the U.K. to regulate these sectors,” he added.

The U.K. risks falling behind efforts by other countries to tackle the dominance of leading internet firms. This month the EU approved a law that set the rules on how companies should keep people safe on the internet.

The Department for Digital, Culture, Media and Sport said it could “not comment on timelines for potential future legislation”.

The CMA declined to comment.