UK Antitrust Regulator Chair Appointment Raises Concerns

Concerns Raised Over Amazon Executive's Appointment to U.K. Antitrust Body

A collective of organizations and individuals has issued an open letter voicing apprehension regarding the U.K. government's selection of a former Amazon executive to lead the Competition and Markets Authority (CMA).

The group, encompassing U.S.-based technology companies like Yelp, DuckDuckGo, and Mozilla, asserts that the CMA’s independence from external influence is paramount.

Maintaining Regulatory Independence

The signatories believe the CMA must remain “free from political pressure” to effectively regulate Big Tech and foster “positive economic outcomes for the entire economy.”

The U.K.’s antitrust regulator has previously scrutinized major technology firms for a range of violations.

Alongside the European Union (EU), the CMA has been instrumental in curbing the power of large tech companies through blocked mergers and mandated divestitures.

Shifting Priorities and Pro-Growth Initiatives

Recently, the U.K. has aimed to establish itself as a nation supportive of growth and technological advancement by reducing regulatory burdens and streamlining bureaucratic processes.

This repositioning appears to include a desire to attract increased foreign investment, potentially through adjustments within its antitrust enforcement framework.

The Appointment of Doug Gurr

Reports surfaced last month indicating the U.K.’s Department of Business and Trade had removed Marcus Bokkerink from his position as CMA chair.

This change paved the way for Doug Gurr, who held multiple positions within Amazon’s operations in both the U.K. and China for almost ten years.

Gurr departed from Amazon in 2020 to assume the role of director at the Natural History Museum.

Government Rationale

Jonathan Reynolds, the U.K.’s secretary of state for business and trade, stated that the government has “a clear plan for change — to boost growth for businesses and communities across the U.K.”

Reynolds further explained that the government intends for regulators, including the CMA, to stimulate the economy with pro-business decisions.

The goal is to drive prosperity and growth, ultimately increasing financial well-being for citizens.

These decisions are intended to put “more money in people’s pockets.”

A Shift in Oversight

The recent appointment of Michael Gurr to an interim position warrants attention. While currently temporary, this move indicates the government’s preference for individuals possessing strong connections within the technology industry. Government statements released last month highlighted that Gurr’s experience at Amazon would contribute a significant depth of knowledge from the tech sector.

This decision has prompted a coalition of over twenty organizations to send a letter to key government officials, including Jonathan Reynolds and Rachel Reeves, the Chancellor of the Exchequer. The inclusion of companies like DuckDuckGo, Yelp, and Mozilla demonstrates the concern of smaller tech businesses regarding Europe, and the U.K. specifically, as a potential safeguard against the pervasive influence of Big Tech globally.

Further signatories to the letter encompass the Future of Technology Institute, the Booksellers Association, the Coalition for App Fairness, and the Open Markets Institute, among others.

The letter expresses apprehension, stating, “With the removal of the CMA Chair and the subsequent appointment of a former Amazon executive, we are concerned that the UK Government may be deviating from its dedication to vigorous competition enforcement within the DMU [Digital Markets Unit] framework and the CMA’s independent operation.” It continues, asserting that “Sustainable, long-term, and inclusive growth and innovation will be jeopardized if the CMA prioritizes the interests of the largest corporations and strays from its primary objective of fostering competitive markets.”

The CMA’s Digital Markets Unit was specifically established to address the challenges posed by Big Tech, and the letter’s authors emphasize the importance of protecting this unit from undue political interference.

The signatories argue that “The newly established DMU regime must be perceived as trustworthy by the government and operate free from political pressure to yield positive economic results for the entire economy.” They believe that only through such independence can Big Tech companies be encouraged to engage in constructive dialogue with businesses and consumers, leading to beneficial outcomes rather than attempts to weaken necessary regulations. Essentially, the DMU – and the CMA – can only stimulate growth with genuine operational autonomy.

The complete text of the letter, along with a comprehensive list of signatories, is provided below.

The Rt Hon Rachel Reeves MP
Chancellor of the Exchequer
HM Treasury
1 Horse Guards Road
London
SW1A 2HQ
United Kingdom

CC: Rt Hon Jonathan Reynolds MP, Secretary of State for Business and Trade; Rt Hon Peter Kyle MP, Secretary of State for Science, Innovation and Technology; Baroness Jones of Whitchurch, Parliamentary Under-Secretary of State for the Future Digital Economy and Online Safety

Dear Chancellor,

We represent a diverse group encompassing challenger and mid-sized tech companies, trade associations, civil society organizations, and experts who have consistently advocated for increased competition in digital markets through the new Digital Markets Unit (“DMU”) regime. We share the Prime Minister’s desire for the Competition and Markets Authority (“CMA”) to prioritize growth. However, lasting growth and inclusive innovation will only be realized by dismantling barriers to competition, not by allowing them to persist.

The recent removal of the CMA Chair and their replacement with a former Amazon executive has raised concerns that the UK Government may be retracting its commitment to robust competition enforcement within the DMU regime and the CMA’s operational independence. Long-term, sustainable, and inclusive growth and innovation will be unattainable if the CMA focuses solely on the interests of the largest companies and deviates from its core mandate of maintaining and promoting competitive markets.

The ex-ante powers outlined in the Digital Markets, Competition, and Consumers Act (“the DMCCA”) are fundamentally different from the CMA’s other enforcement powers, such as merger reviews. They are designed to make tailored, targeted decisions to regulate a limited number of firms possessing substantial competitive power. The new DMU regime must be trusted by the government and shielded from political influence to unlock positive economic outcomes for the entire economy. Only then will Big Tech firms be compelled to engage in honest conversations with businesses and consumers regarding the promotion of positive economic outcomes, rather than exerting pressure on the regulator to dilute necessary remedies. In essence, the DMU – and the CMA – will only be able to foster growth if they are truly operationally independent.

The Labour Party has consistently supported the need for decisive action to address the monopolization of the UK’s tech sector, including throughout the passage of the DMCCA. We concur with your previous statement that “the new monopolies of platform capitalism like Google, Facebook, and Amazon […] wield monopoly power over knowledge and information” and “block competitive markets.” You rightly asserted that “monopolies need to be broken up to ensure competitive markets.”

Since you articulated those views in 2018, the situation has not improved; in fact, the largest incumbent tech monopolies have strengthened their positions and are now leveraging their dominance to establish a stranglehold in emerging markets. As established by the Furman Review and numerous subsequent expert studies worldwide, greater competition in digital markets, enforced by independent and impartial regulators, is crucial for unlocking the government’s core mission of economic growth, not an impediment to it. The CMA’s independence must be vigorously defended as it pursues its mission in the face of aggressive lobbying from tech giants and other vested interests, whose primary goal is to protect the barriers safeguarding their monopoly profits.

If UK businesses are finally able to compete with Big Tech firms on a level playing field, this will stimulate critical investment, innovation, and growth without restricting the ability of those companies to invest in the UK economy should they choose to do so. Indeed, effective enforcement of the DMCCA will unleash growth throughout the UK economy.

The CMA has demonstrated that Apple and Google generated over £4 billion in profits in 2021 from their UK mobile businesses beyond what was necessary to fairly reward investors. The regulator has also revealed that the cost of digital advertising reached £500 per household in 2019 – totaling £14 billion – significantly higher than it would be in a competitive market. Open choices, trust, transparency, and fair dealing will empower UK companies to thrive and provide UK consumers with a better, cheaper, and more diverse range of products and services. A more competitive and diverse digital economy will ensure that the benefits of new technologies are shared more broadly, reduce the UK’s vulnerabilities, and grant citizens greater autonomy and choice over how they share information and interact online.

We have noted that government officials, in briefings to the press, have expressed “frustration across the board from business” regarding the CMA’s performance, and that the government has heard “unhappiness from everyone.” We encourage the government to listen more attentively to the hundreds of thousands of firms across the UK that operate in monopolized markets daily, and to carefully scrutinize the funding and independence of lobby groups claiming to represent the interests of small businesses and startups to determine which groups genuinely reflect the broader economy.

We remain supportive of the CMA’s approach in recent years, developing the new pro-competition regime for digital markets, investigating harmful conduct by the largest incumbent tech firms, reviewing mergers that risk further concentration, and building a world-leading team of digital and tech experts. It is an internationally respected regulator, particularly due to its pioneering approach to digital regulation, which is now being emulated globally.

We hope the government will reaffirm its commitment to the CMA’s operational independence and the swift implementation of the new pro-competition regime for digital markets through its forthcoming Strategic Steer. We would welcome the opportunity to discuss how we can collaborate to achieve this.

Yours sincerely,

Individuals:

Professor Amelia Fletcher, CBE, University of East Anglia (Former Non-Executive Director, CMA; Member, HM Treasury Digital Competition Expert Panel – Furman Review)
Professor Derek McCauley, University of Nottingham (Member, HM Treasury Digital Competition Expert Panel – Furman Review)
Professor Philip Marsden, Bank of England (Member, HM Treasury Digital Competition Expert Panel – Furman Review)
Sir Vince Cable, former Secretary of State for Business, Innovation and Skills

Organisations: