Distractions plague Britain’s post-Brexit tech plan – POLITICO

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LONDON – Post-Brexit, Britain had big tech dreams, but supporters fear they’ve gone off course.

One of the promises of the UK vote to leave the European Union was that the UK could make itself more attractive to innovative digital companies by developing a new approach to key legislative challenges such as data protection and digital competition.

Since the 2016 vote, officials have been working on plans – hailed by ministers as “more pro-growth and more innovation-friendly” – to give the country an edge over European rivals.

But officials and the industry warn that Downing Street is at risk of losing its gaze in three critical areas – new rules designed to encourage more investment in the tech sector of pension funds, the UK’s new digital competition regime and its approach to data regulation Ball to avert Downing Street.

As the government finalizes the next phase of its legislative program, which it will announce on May 10 at the official opening of the next parliamentary session, known as the Queen’s Speech, officials working in these areas and the lobbyists trying to to influence them, their files being squeezed. They’re fighting a government distracted by the war in Ukraine and its own domestic problems, most notably the so-called Partygate scandal, which has seen Prime Minister Boris Johnson and Chancellor Rishi Sunak both charged with breaking COVID rules by attending parties were fined.

Sunak’s declining fortunes, who have also come under criticism for his wife’s tax status, are particularly problematic, according to insiders, as he was widely seen as a key advocate for tech at the helm of government.

Former Conservative leader Iain Duncan Smith, who was tasked by the Prime Minister to come up with proposals for how Britain can adjust its regulatory system post-Brexit, said the problem was simply a lack of ambition.

“This needs to be done at a canter rather than a walk. It’s too slow and not adventurous enough and not bold enough,” he said.

A UK government spokesman insisted key technical files were being delayed because they were “pure speculation”.

“We will set out our legislative program for the year as usual in the Queen’s forthcoming speech,” they said.

Sunak crushed

Officials at Britain’s Department for Digital, Culture, Media and Sport and industry leaders say Sunak’s Treasury has been a key ally in its bid to make the UK more tech-friendly.

As of 2020, the helm is Sunak, whose father-in-law Narayana Murthy founded Indian IT services giant Infosys and spent time in Silicon Valley while residing in California.

Its government budgets have been seen as tech-friendly, notably by changing the rules for many UK pension schemes to make it easier for funds to invest in illiquid assets that cannot be quickly converted into cash, such as: B. venture capital investments or carbon-free technology. Sunak has also proposed reforms to listing rules and visas for tech entrepreneurs, both of which have been welcomed by the industry.

“Rishi obviously has a strong understanding of how tech ecosystems work, and that’s made a huge difference over the past few years,” said Dom Hallas, executive director of the Coalition for a Digital Economy.

But officials working on technology policy in the government, as well as some industry insiders, are watching Sunak’s fall with concern.

“One of the things I think is concerning is that Sunak is in a very difficult position right now. We just hope he really stays,” said a government official who works on technology policy.

Already industry insiders fear his bold proposals could be watered down elsewhere now that he is no longer a leader, citing News that the Department for Work and Pensions has launched its own pension fund reform consultation that some industry officials fear will that they will cause further delays.

A Treasury Department official insisted Johnson’s entire cabinet is working together to “ensure our plans are both ambitious and workable.”

Slot machine competition

There are also concerns within the digital division that another key pillar of Britain’s technology plan – a new digital competitive regime – is not being taken seriously enough by No 10 Downing Street.

The new Digital Markets Unit, which was launched last July with a promise to “prevent abuse of power – unleash a wave of innovation”, was described as a “flexible and focused approach” in a dossier on post-Brexit benefits published by Boris Johnson in January hailed as the one to be adopted by the EU.”

The UK’s plans will give the Digital Markets Unit, housed within the country’s competition and markets agency, new powers to crack down on abusive practices by big tech giants targeting companies that have a “strategic… “Market Status”, powers they would have had before Brexit were Brussels’ domain. The measures are said to include legally binding codes of conduct, tailored to each platform and based on past abuses.

The EU’s Digital Markets Act, Brussels’ own response to anti-competitive abuse by the world’s largest tech platforms, was recently adopted by EU institutions. The new EU rules take a more broad-based approach, introducing a range of bans and obligations on some of the world’s largest tech platforms, including Google, Meta, Apple and Amazon. However, it will likely be early 2024 before platforms are forced to play by the rules.

In the UK, the digital and business departments, which are jointly responsible for the plan, are still locked in talks with Johnson’s inner circle over when a digital competition bill will go through Parliament, according to two officials familiar with the discussions.

Even if an announcement is made next month, officials fear it could be 2023 before MPs actually legislate.

According to an official who is privy to the discussions, No. 10 wants priority given to another bill, the Digital Division’s Media Act, which allows for the sale of public broadcaster Channel 4.

The sale of the channel is seen by some as an unnecessary distraction to placate Tory MPs furious at parties breaking lockdown at Downing Street at the height of the pandemic. Even the Conservative leader of the Digital Committee in the UK Parliament, Julian Knight, questioned whether the government’s proposed sale of Channel 4 was in an act of “revenge” for “biased reporting” on Brexit.

“A delay in competition law would be important,” said Ben Greenstone, a former senior official in the digital division who now runs the consulting firm Taso Advisory.

“If we accept that there is a desire for a post-Brexit tech strategy, I don’t think you can have said, ‘We’re going to bring up all these world-leading laws on content, competition and data,’ and then pull your punches at the competition shortly after the EU landed theirs. It’s a remarkably bad look.”

Former DCMS selection committee chair Damian Collins has also urged the government to act. wrote in the Times last week that the government should pursue its plans for fairness in digital markets more vigorously.

British media groups have since joined the push against further delays. Organizations such as ITN, Channel 4, the BBC and the News Media Association, recently wrote to the Prime Minister, stressing the fact that “any delay in legislation risks the UK falling behind other jurisdictions”.

However, the plan for a new digital competition regime does not meet with general approval. A senior Conservative MP, who has been following discussions about the competition regime but did not want to go public with his “minority” concerns, urged caution, fearing the plans had not been properly thought out.

For its part, the Competition and Markets Authority, the UK body tasked with leading enforcement of the Digital Markets Unit’s new powers, fears delays could expose the UK’s lack of progress in regulating digital markets compared to its cross-Channel neighbours, such an official close to the cause.

“We are seeing progress in Europe in adopting new rules for abusive practices in the digital sphere Markets,” said a UK official involved in the affair. “People are starting to look to the UK and wonder why talk of the delays has surfaced.”

“That was not the vision for a post-Brexit Britain.”

data race

One area where the digital department has gained is its data plan – a data bill is expected to be prioritized in the Queen’s speech for parliamentary time next month.

But even here there are fears that Britain may not be able to capitalize on its post-Brexit advantage.

For much of 2020 and 2021, reforming the UK data protection regime was a pet project of Oliver Dowden, the UK’s former digital secretary, who spoke of unleashing innovation and getting rid of annoying cookie pop-ups.

His successor, Nadine Dorries, has shown much less interest in the file, delegating much of the work to her junior minister, Julia Lopez. Without a vocal supporter in Johnson’s cabinet, Britain’s data reform risks falling down the pecking order of British government priorities.

An announcement last month that the EU had signed a data pact with the US also hit the UK on the wrong foot.

London had eyed a data deal with Washington as a priority – and a way to showcase its post-Brexit technical credentials to the world – but now finds itself chasing Brussels.

With the sixth anniversary of Britain’s vote to leave the European Union approaching, the Prime Minister still has work to do to persuade supporters of his post-Brexit tech policy that a digital dividend will soon be paid.

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