The Digital Competition Expert Panel, chaired by former Obama economist Jason Furman, delivered its final report on 13 March 2019. The UK government accepted the recommendations in principle in March 2020. It then established the Digital Markets Unit (DMU) within the Competition and Markets Authority (CMA) in April 2021. The DMU received statutory powers through the Digital Markets, Competition and Consumers Act, which became law on 24 May 2024.
The review was formally titled 'Unlocking digital competition'. Commissioned in August 2018, it asked a blunt question: were existing competition tools adequate for markets dominated by a handful of large tech firms? The panel's diagnosis was that traditional antitrust enforcement acted too slowly. In digital markets, network effects and data advantages can entrench a dominant position long before a case concludes.
What the review diagnosed in digital markets
The structural traps of digital dominance
The panel identified several structural features that make digital markets prone to persistent dominance. Network effects mean that users benefit from being on the same service as other users. That creates a self-reinforcing advantage for the largest operator. Data advantages let incumbents improve their services faster than any potential rival because they hold more user information. Finally, high switching costs and limited data portability lock consumers and businesses into a single ecosystem.
Why competition law arrived too late
The review argued that these features create 'winner takes most' dynamics. A firm that achieves strategic market status can use that position to extend its power into adjacent markets. The panel concluded that existing competition law was too slow and too narrow to tackle the problem. It typically required proof of harm to consumers in a specific market before intervention, a bar that was impossible to meet while a market was still tipping.
Strategic market status and a new regulator
A code of conduct with teeth
The central proposal was the creation of a Digital Markets Unit with the power to designate firms as having 'strategic market status'. Once designated, a firm would be governed by a bespoke code of conduct designed to block the most common forms of anticompetitive behaviour. The code would require fair trading, meaning a gatekeeper could not favour its own services over those of competitors. It would mandate interoperability so that users of one service could communicate with users of another. It would also impose data portability requirements, giving users and businesses the right to move their data to a competing service.
Intervention before the damage is done
The DMU would not need to prove that a specific practice had caused consumer harm before acting. Instead, it could set rules in advance and enforce them. The panel recommended that the DMU sit within the CMA but operate with a dedicated mandate and funding. It would be staffed by specialists in digital economics and engineering.
Tougher merger control for tech acquisitions
Closing the turnover threshold loophole
The review proposed changes to how mergers involving large tech firms are assessed. It recommended lowering the threshold for the CMA to review acquisitions by firms with strategic market status. Deals that previously escaped scrutiny because the target had low turnover could now be examined. The panel argued that large operators often acquired small, fast-growing rivals before the newcomer became a competitive threat, a practice sometimes called 'killer acquisitions'.
Shifting the burden of proof
The review also recommended shifting the burden of proof in such cases. Rather than the regulator having to show that a merger would substantially lessen competition, the acquiring firm would have to demonstrate that the deal posed no harm. The panel proposed that the CMA should be able to impose conditions on mergers it could not block, such as requiring the acquirer to maintain the target's interoperability with rival services.
Data openness and the government's response
Beyond data portability
Beyond merger reform, the review called for measures to increase data openness. It recommended that individuals and businesses should have a legal right to access and transfer the data they generate on a service. It also proposed that firms with strategic market status should be required to open certain data sets to competitors, where doing so would not compromise user privacy or security. The panel argued that data portability alone is insufficient. The data must also be usable in a meaningful way on a competing service.
From recommendation to Royal Assent
The UK government accepted the Furman Review's recommendations in its March 2020 Budget. The DMU was established in shadow form within the CMA in April 2021, operating without statutory powers while legislation was prepared. The Digital Markets, Competition and Consumers Act, which gave the DMU its enforcement teeth, received Royal Assent on 24 May 2024. The Act largely follows the architecture the Furman panel proposed. The exact list of firms designated with strategic market status under the new regime, however, was not set at the time of the review.
