Subscription traps and fake reviews are now prohibited under new regulations

As part of upcoming legislation known as the Digital Markets, Competition and Consumer Bill, purchasing, selling, or hosting fabricated reviews will soon become unlawful.

The new law, set to be introduced on Tuesday, is aimed at promoting competition among major tech companies while also safeguarding consumer interests. The legislation requires firms to remind customers when free trial subscriptions conclude, and it prohibits individuals from receiving compensation or free products in exchange for writing favorable reviews.

The bill has been under development since 2021, with the objective of limiting the market dominance of a few major technology firms, though none have been specifically named yet.

The new Digital Markets Unit, which will be a component of the Competition and Markets Authority (CMA), will be granted specific powers to facilitate competition in specific markets as required, regardless of the country in which a firm is based.

The unit may instruct Apple to enable users of iPhones and iPads to download apps from alternate app stores, for example, or compel search engines to share data.

Under the new UK Digital Markets, Competition and Consumer Bill, the CMA will be authorized to levy fines up to 10% of a company’s global turnover depending on the severity of the violation, and no court order will be required to enforce consumer law.

The EU Digital Markets Act has also been established to address similar competition concerns with major tech firms. The bill covers a wide range of issues, and the CMA will be responsible for addressing the global problem of big tech’s market dominance, assisting people in managing subscriptions, and verifying that product and service reviews are genuine.

The CMA has demonstrated its ability to effectively regulate companies that are primarily based in the United States, as evidenced by its successful campaign to compel Meta, Facebook’s parent company, to divest the graphics animation firm Giphy after determining that it would be detrimental to competition.

According to lawyer Nick Breen of Reed Smith, the new bill’s enhanced powers given to the CMA imply that “no-one has the luxury of taking this lightly.” Trade association techUK’s Neil Ross stated his desire for “robust checks and balances” as well as an effective appeals process.

Business Minister Kevin Hollinrake claimed that “the new laws we’re delivering today will empower the CMA to directly enforce consumer law, strengthen competition in digital markets, and ensure that people across the country keep hold of their hard-earned cash.”

The Department of Business and Trade stated that the new regulations will be enforced as soon as possible following parliamentary approval.