Why UK digital regulation makes good sense for UK businesses

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Written by Maeve Walsh, Associate, Carnegie UK Trust

Seeking global solutions and global co-operation on digital regulation makes sense. The world is now reliant on a small handful of (mainly US-based) global platforms for trade and business, data-sharing and advertising flows, intelligence sharing and national security, and personal and corporate transactions and communications. The advantages of technology cross borders, as do the harms. Many nations and trade blocs are struggling to find solutions that balance protection from harm with rights and innovation.  Working towards consistency and coherence in the regulatory sphere is a noble idea, albeit one that won’t come quickly.

But there are merits going it alone and seeking first-mover regulatory advantage in this complex, interconnected world. As we leave the EU, the UK is in a strong position to carve out a uniquely British model of regulation that is compliant with international law and systemic, rather than palliative or reactive. Much of the foundations are already in place; taken together they would increase competitiveness, support our national values and lead the world in enhancing free speech, protecting children and the elderly and improving national security.

As the UK goes it alone outside the EU, it is already clear that standing on our own two feet in setting laws in the digital sphere may not be straightforward. The OECD “warned” the UK in no uncertain terms recently that it should drop its proposals for a tax on the big tech giants and wait for a global solution; the US rattles its threat of tariffs in response; and the early salvos in what will be a complex set of negotiations and trade-offs for a UK-US trade deal are underway.

For example, the UK can:

  • Protect children, preserve childhood online, export our approach – a statutory duty of care – work which has been championed by Carnegie UK Trust supported by a code of practice drawn up with expert stakeholders would be central to protecting children online. Other regulatory components would bolster the duty of care, in particular the world-leading Age Appropriate Design Code, recently published by the Information Commissioner’s Office.
  • Attack scams and fraudsters who prey on the elderly – online fraud is now the most prevalent property crime in England and Wales. The social media platforms where so much of this crime happens should take responsibility for what happens on their service, and this can be done by applying a statutory duty of care to a range of economic crimes including copyright abuse that effect consumers and SMEs online.
  • Enhance and promote people’s rights and democratic engagement. We have a right to speak, but not if we use that speech to silence or intimidate others, or to manipulate democratic engagement. Human rights law gives governments positive obligations to help promote and protect speech. The duty of care regime we set out will require companies to have regard to human rights instruments when taking steps to reduce harm and protect the rights of women, children, disabled people and those from gender and minority ethnic communities to speak without fear and participate fully in democratic debate. See Professor Lorna Woodsrecent comprehensive paper on fundamental rights and a duty of care.
  • Level up for free trade. We can influence the new rules for online services being made around the world over the next few years. France, Germany, Singapore and Australia already have basic internet-specific laws in place.  The EU is about to dive into years of complex argument about an EU regulator in the Digital Services Act. Ireland, India, Canada, The Netherlands and New Zealand are considering new law and Japan is under pressure to tighten theirs.  The UK statutory duty of care proposal is the only comprehensive, straightforward package.  With OFCOM as regulator already obliged to be proportionate in its approach to SMEs and others, this will give British companies a headstart in designing services to be safe in any market without constraining innovation.
  • Help British start-ups with a ruthless focus on anti-competitive behaviour. The UK has a healthy innovation ecosystem that underpins new markets. Anti-competitive behaviour by the big tech companies is becoming a huge concern. The Furman Review for the Competition and Markets Authority (CMA) made the world-leading suggestion of structurally opening-up the tech platforms to allow competition in.  The ICO and the CMA are studying the digital advertising market that funds the biggest operators. Government should strongly support these regulators if action is needed and study the cross-over to online harms.  

Taken together, it is clear that the UK is probably the only country where there is concerted, effective action underway to tackle the full swathe of issues caused by largely unregulated tech companies. Across the developed world, regulation is becoming the new cost of doing business online and Britain could get ahead of the curve and have the best system: effective, but proportionate. Being regulated here should be a badge of entry to other markets, making the UK should an attractive place for companies to design products and services. The government should keep its eyes on that prize – and not blink first.

For a summary of the duty of care proposal for online harm reduction, take a listen to the recent RightsCast podcast with Professor Lorna Woods.

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