A substantial role for third parties under the DMCC

The Digital Markets, Competition and Consumers Act (DMCC) envisages a strategic and participatory role for third parties such as competitors, consumer groups, and industry stakeholders.

By engaging in the Competition and Markets Authority’s (CMA) regulatory process, third parties can help shape the future conduct of powerful companies in digital ecosystems, influence outcomes, and pursue compensatory legal remedies.

SMS designation: A firm may be designated by the CMA as having Strategic Market Status (SMS) in relation to a specific digital activity linked to the UK, if - based on a forward-looking assessment covering at least five years - it is found to hold substantial and entrenched market power, along with a position of strategic significance in that activity. Before designating a firm, the CMA must conduct a public consultation. This consultation process enables third parties to submit evidence, market insights, and technical expertise ensuring that the designation process is based on a proper understanding of market dynamics, potential harms and remedies.

Tailored codes of conduct: The CMA can impose conduct requirements on an SMS firm to promote fair dealing, open choices, and trust and transparency. When developing these bespoke codes of conduct, the CMA will hold public consultations, allowing third parties to influence the obligations imposed on the dominant companies.

Pro-competitive interventions (PCI): Once a firm has been designated with SMS in respect of a digital activity, the CMA can launch a PCI investigation. A PCI can be behavioural (e.g. data mobility, interoperability, data access), structural (e.g. divestment) or in the form of a recommendation for action to another public authority. The CMA will consult on the proposed decision, set out emerging findings and a description of any interventions that are proposed. Third Parties can submit written representations and may also have the opportunity to make oral representations.

Appeal against decisions: CMA decisions under the DMCC are generally subject only to judicial review, meaning the Competition Appeal Tribunal (CAT) can overturn them only on limited legal grounds, such as procedural unfairness or irrationality. Since appeals on the merits are rare - except in cases like financial penalties - third parties would benefit from early engagement by submitting evidence or concerns before decisions are made by the CMA.

Declaratory relief: Designated firms owe a statutory duty to any person affected by a breach of a conduct requirement. An aggrieved third party may apply to the CAT for declaratory relief - a legal declaration that an SMS firm has breached a conduct requirement. The practical implications of this mechanism are: (i) it empowers private parties to obtain clarity without waiting for the CMA’s enforcement action; and (ii) such a declaration can form the basis for subsequent legal steps, including claims for damages. Where compliance with conduct requirements by SMS firms is uncertain, third parties can play a proactive role in monitoring obligations and may pursue either CMA enforcement or litigation as appropriate. This mechanism is particularly valuable given the uncertainty that already surrounds compliance under the EU Digital Markets Act (DMA), where allegations and denials of non-compliance have emerged and clarity is often lacking.

Damages: The DMCC allows the Competition Appeal Tribunal (CAT) to award exemplary damages to third parties in certain cases. These are punitive damages, granted in addition to compensation, intended to punish particularly egregious conduct and deter future breaches. However, exemplary damages are not available in collective proceedings. Their availability may encourage third party stakeholders to bring individual claims against SMS firms where misconduct is especially serious.

The DMCC is a significant milestone in digital market regulation, aiming to promote competition in fast-moving digital environments. For third parties that depend on access to critical digital markets, it offer avenues to seek a fair deal and  protection from unfair or harmful practices of very large technology firms. Crucially, the CMA appears to be encouraging stakeholders to move beyond passive observation by actively contributing evidence, sharing insights, and engaging with its processes to help shape informed and effective oversight of complex digital environments.