TIGA’s Chief Executive Officer, Dr Richard Wilson OBE, has written to John Penrose MP to outline TIGA’s objectives and priorities for competition policy in the UK.
John Penrose MP has been asked by HM Treasury to lead a review considering how the UK’s competition regime can be enhanced in the context of Covid-19 and the end of the Brexit transition period.[1]
The representation underlined TIGA’s support for functioning competitive markets because they promote choice, innovation, job creation, lower prices and better services. However, it made clear that TIGA’s position is that some UK markets, including some digital markets, are not as competitive as they could and should be. TIGA would like to see the Government and regulators adopt a more robust policy approach to foster healthy competition in the UK.
Dr Wilson’s letter also included the following key points:
- Research has concluded that a ‘sizeable proportion’ of the UK’s markets are ‘dominated by a small number of large incumbents’.[2] This has a range of negative economic outcomes for consumers and deters innovation in the economy.
- As the digital economy evolves, close attention should be paid to address the emergence of a small number of dominant firms which make it harder for new companies to enter or scale-up. The March 2019 Furman Review highlighted that the largest digital companies have made ‘extensive use of mergers’ to acquire companies that could have become competitors. Much of this activity has taken place without intervention or even scrutiny from competition authorities.[3]
- Competition and innovation are key elements of the UK’s games industry success with the total studio population rising from 812 to 1,041 between 2019 and 2020.[4] However, many independent games developers find it hard to scale up because of difficulties accessing finance and skilled personnel.
- To bolster competition within the UK’s games industry and allow the UK to compete more evenly with its international competitors, the Government should enhance Video Games Tax Relief, introduce a Video Games Investment Fund, strengthen the UK Games Fund, and enable businesses to recruit highly skilled workers from the EU and beyond.
[1] HM Treasury, 14 September, link
[2] Social Market Foundation, Concentration, Not Competition, October 2017, link
[3] HM Treasury, Unlocking digital competition, Report of the Digital Competition Expert Panel, March 2019, link
[4] TIGA, Making Games in the UK Today (2020)