Digital Competition Rules: How the UAE Is Addressing Big Tech Market Power

The global economy has experienced a rapid shift towards digital markets over the last decade. Technology platforms and digital services have become central to commerce, communication, and everyday life. Alongside the opportunities this brings, concerns have grown about the market power of large technology firms, often referred to as “Big Tech”. These concerns centre on unfair dominance, barriers to new entrants, and commercial practices that can stifle innovation. The United Arab Emirates (UAE) is responding to these challenges with a modernised competition regime designed to promote fair competition, encourage innovation, and protect consumers in digital markets.

The New Competition Law: A Broader Scope

In December 2023, the UAE enacted Federal Decree‑Law No. 36 of 2023 on the Regulation of Competition (the New Competition Law), which replaced the previous competition regime that had been in place since 2012. The New Competition Law reflects international best practice by broadening the scope of competition oversight and expressly recognising competition in the digital economy as part of the “relevant market”. This means commercial activities conducted through digital platforms and services fall within the authority of the competition regulator.

The law targets a range of anti‑competitive behaviour. Traditional prohibitions on restrictive agreements and abuse of dominance remain central. On top of these, the New Competition Law introduces safeguards against predatory pricing and exploitation of economic dependence, aimed at preventing firms with substantial market power from using unfair tactics to disadvantage competitors.

Digital Markets and Competition Law Enforcement

A key modernising feature of the New Competition Law is the expansion of the definition of a “relevant market” to include digital marketplaces and network‑driven platforms. Digital markets are often characterised by strong network effects and the dominance of a small number of firms. In recognition of this, the UAE’s regulation allows authorities to assess competition issues that arise in online environments, including where market conduct or structural dominance could reduce contestability or restrict consumer choice.

Enforcement tools have also been strengthened. The law grants the Ministry of Economy and the Competition Regulatory Committee enhanced powers to investigate potential violations, request information and impose sanctions on firms that breach competition rules. Authorities can also conduct market studies into sectors of concern and coordinate with other regulators to address complex digital market issues. The combination of broadened scope and stronger enforcement reflects the UAE’s ambition to be a credible and robust jurisdiction for competition law, including in technology‑centric markets.

Merger Control and Digital Concentrations

Controlling market power in digital markets also requires careful oversight of mergers and acquisitions. Digital firms can gain market power through consolidation, and without effective merger control this can impede competition. The New Competition Law introduces a mandatory pre‑notification regime for “economic concentrations”, which includes mergers, acquisitions and other transactions that result in direct or indirect control of another business. Firms that meet specified turnover or market share thresholds must notify the UAE Ministry of Economy at least 90 days before completing a transaction. This suspensory regime means that the transaction cannot be completed until clearance has been obtained.

These merger control provisions provide clarity around transactions that might affect the competitive landscape, including in digital sectors. By requiring early notification and review, regulators can assess whether a proposed deal will harm competition and consumer welfare and can impose remedies or reject the transaction where necessary.

Addressing Abuse of Dominance and Digital Practices

The concept of “abuse of dominance” remains a cornerstone of competition law, and the New Competition Law retains this prohibition with important refinements relevant to digital markets. A firm may be considered dominant not only based on market share, but also if it possesses the ability to act independently of competitive constraints. This is particularly pertinent in digital markets where platforms with high user engagement or control over critical infrastructure may enjoy de facto dominance even without a numerically high market share.

Abusive practices may include unfair pricing, discrimination between users or business partners and refusal to deal or provide access to essential facilities. In the context of digital ecosystems, issues such as algorithmic pricing, preferential treatment of affiliated services, and restrictions on third‑party interoperability are receiving increasing regulatory attention. Authorities have signalled that digital platforms should ensure their innovation strategies do not hinder competition or unfairly disadvantage rivals.

What This Means for Businesses and Consumers

For businesses operating in or entering the UAE market, understanding the implications of the New Competition Law in digital markets is essential. Firms with significant digital operations should assess their market conduct, review potential merger transactions early, and consider how changes in digital strategies may interact with competition obligations. For consumers, the law is designed to foster a fairer, more dynamic marketplace where competition can flourish and innovation is rewarded.

As the UAE’s competition regime continues to develop, particularly through forthcoming implementing regulations and enforcement guidelines, the emphasis on digital competition is likely to grow. The legal framework now provides regulators with the tools to review, challenge and remedy anti‑competitive conduct in both traditional and digital markets. For a nation seeking to position itself as a hub for innovation and investment, maintaining competitive markets is crucial to sustainable economic growth.

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This material is provided for general information only. It should not be relied upon for the provision of or as a substitute for legal or other professional advice.