The impact of the UK’s new legislative agenda on the tech sector
The question
How will new legislative developments affect the UK tech sector?
The key takeaway
Several new and ambitious Bills are being introduced that will reform the UK’s regulatory landscape with the aim of improving innovation and growth. One of the sectors most impacted will be the tech sector.
The background
In the Queen’s Speech this year, 38 new Bills were announced, many affecting the tech sector, including a Data Reform Bill, an Electronic Trade Documents Bill, and the Digital Markets, Competition and Consumer Bill.
The government’s focus is on improving economic growth by reforming the UK’s legal and regulatory landscape with a view to promoting innovation and growth.
The Data Reform Bill
The Data Reform Bill is designed to address issues with the UK General Data Protection Regulation (GDPR) and the Data Protection Act 2018, in particular the perception that they create excessive burdens on businesses. It is hoped that the new Data Reform Bill will introduce a new data rights regime that will reduce these burdens. One way it aims to do this is by reducing the number of reports that data controllers are required to make to the Information Commissioners Office (ICO) under the GDPR. Alongside this, there will be a move to modernise the ICO by ensuring it has enhanced powers to take stronger action against organisations that breach data rules. Finally, the Bill aims to facilitate scientific innovation and ultimately help to boost the economy.
The Electronic Trades Documents Bill
The Electronic Trades Documents Bill is seen as a long overdue development within our digital age, by placing electronic trade documents, such as bills of lading and bills of exchange, on the same legal footing as paper documents. This will increase efficiency and raise the security of trade by utilising the transparency and traceability benefits offered by electronic documents. The traditional legal obstacles to the use of trade documents in digital form, such as the fact the current law does not recognise the possibility of possessing electronic documents, will be removed. The Bill will also allow the adoption of new digital solutions which bypass the need for paper and wet ink signatures.
The Digital Markets, Competition and Consumer Bill
A new competition regime for digital markets will also be introduced by various draft legislation in the new session of Parliament. This legislation will largely be based on two consultation responses: one on reforming competition and consumer policy and the other on the creation of a new pro-competition regime for digital markets. The Bill is expected to give the Digital Markets Unit (a body within the Competition and Markets Authority), statutory powers to enforce a new regime that will affect the largest digital companies deemed to have Strategic Market Status in a particular digital activity area, eg digital marketing or app stores. This new regime will aim to promote increased competition through new codes of conduct that the largest businesses will have to adhere to.
Why is this important?
The Data Reform Bill will bring huge improvements to the UK’s current data protection legislation, improving clarity, enabling innovation, and removing unnecessary burdens placed on organisations. However, it will be interesting to see whether this new Bill has an impact on the European Commission’s adequacy decision in favour of the UK under the current regime, which facilitates uninterrupted data flows between the two regions.
The Electronic Trades Documents Bill will have positive impacts on the costs, duration and environmental impact of customs processes. Digitisation of trade documents can help reduce costs for businesses and help drive more competitive pricing for consumers, but it also reduces the carbon footprint of trade. If implemented, it should also enhance the reputation of the law of England and Wales as the go-to choice of law for global trade contracts and maintaining England and Wales as a pre-eminent jurisdiction for the resolution of disputes.
The Digital Markets, Competition and Consumer Bill has been proposed to “actively boost competition and innovation by tackling the harmful effects and sources of substantial and entrenched market power”. The new regime aims to facilitate a focused, well informed and targeted approach to updating competition policy in the UK post Brexit, comparing favourably to similar proposed regimes in the EU and the US.
Any practical tips?
Keep a close eye on updates and new guidance concerning these Bills. They are important developments for the tech sector as a whole and understanding how they will work in practice, and what adaptations might be necessary for business practices, will be key.