Dominant market position: Fines against Apple and Google soon possible in the UK?

A change in the law in the United Kingdom is to give the market regulator far-reaching intervention options against companies that occupy a dominant position in the market. In the technology sector, Google and Apple could be hit by heavy fines in the future.

Preventing the formation of monopolies

The aim of the new regulation is simple: to preserve the free market economy and prevent monopolies. In the technology sector in particular, there have been strong developments in recent years toward the monopolization of individual market areas, which more and more states are countering with more restrictive action against the corresponding companies. In future, the UK regulatory authority will have the option of imposing enormous fines of up to ten percent of a company’s global sales if it occupies a dominant position in the market.

However, this regulation only applies to large companies. Thus, in order to be penalized, a company must either generate sales of more than one billion pounds in the United Kingdom or more than 25 billion pounds worldwide.

High penalties against Apple and Google?

Apple and Google are indisputably dominant in their respective fields of activity in the United Kingdom and could thus be affected by the new regulation. They would face fines of around 32 billion pounds (Apple) and around 21 billion pounds (Google).

In addition, the proposal stipulates that the regulator can require the affected companies to eliminate their dominant position. For Google, that would mean, for example, that the company would have to make its search engine data available to competitors. Apple could be required to allow side-loads in the app store.

As of yet, the amendment has not been decided. However, since the government is behind the draft, it can be assumed that it will be passed relatively quickly after being presented in parliament. It should also be understood as a reaction to the economic situation in the United Kingdom. This country is affected by a shortage of goods and above-average inflation, partly due to its efforts to isolate itself. Trade Minister Kevin Hollinrake justified the bill accordingly in populist terms: British women should be given the opportunity to keep their hard-earned money together – which is to be ensured by price reductions as a result of more competition.