FCA Responds to Future Big Tech Regulation
The FCA has released its feedback statement, exploring the impact of Big Tech on the retail financial services sector, which considered growing market concern surrounding these firms becoming more prominent players in the UK market. The statement outlined key challenges to be addressed by future regulatory reform, including appropriately identifying firms under the “big tech” definition, ensuring the future regulatory scope is sufficiently broad to cover all potential activities, establishing how these firms’ use of its datasets will be regulated to allow for fair competition, and organising how these firms’ activities will fit within the regulatory perimeter where there is overlap in their services and the technology.
The key considerations surround the FCA’s ability to effectively oversee firms whilst ensuring fair competition is promoted within the market. While this statement evidences a keenness to remain proactive, a mandate from the UK Government to drive economic growth, means a key balance will need to be struck. The FCA’s next steps must be considered as these Big Tech firms generate significant profits, and their ability to innovate will be key in ensuring market growth. With the rapid rise of financial services being provided by Big Tech firms, it is imperative that the UK takes heed from other global regulators to ensure anti-competitive behaviour is reduced. All jurisdictions have needed to grapple with the impact of multi-national firms, and UK legislation surrounding anti-competitive practices (Digital Markets, Competition and Consumers Bill) is expected to be implemented late next year.
