Big IT companies will face massive fines from the UK watchdog.

If large companies like Google and Facebook break regulations aimed to protect consumers and businesses, a new tech watchdog will have the ability to levy multibillion-pound fines.

According to the government, the Digital Markets Unit (DMU) will protect small firms from unscrupulous activities and provide customers more control over how their data is used.

Ministers will introduce legislation to underpin the DMU’s powers in “due course,” according to the Department for Digital, Culture, Media and Sport, amid speculation that only a draught bill will be mentioned in the Queen’s speech next week.

The Competition and Markets Authority, the UK’s competition watchdog, formed the new branch last year, which will enforce new standards of behavior for the country’s largest tech companies. The new guidelines will make it easier for smartphone users to choose which search engines they want to use, as well as allowing them to opt out of targeted, personalized ads.

“The customer is always right, but they don’t always have a choice,” said Paul Scully, the consumer minister. “Whether it’s limiting shoppers’ choices to certain software on their devices or making it difficult for people to select how their data is used, we’ll stop firms from abusing their authority to damage customers.”

Businesses will be obliged to be informed of substantial changes that may affect them, such as algorithm modifications that direct traffic away from certain websites. The agency would also have the authority to settle disputes between tech platforms and news organizations, ensuring that publications are adequately compensated for their work. According to the government, app makers would be able to offer their products on more equitable and transparent terms.

The DMU will have the authority to penalize companies up to 10% of their global sales – roughly £10 billion in the case of Facebook’s owner, Meta – or 5% of daily global turnover for each day that an offence continues.

The CMA is delighted that the government has moved forward with these measures.

The government is also launching the internet safety law, which will be included in the Queen’s speech and will oblige tech companies to safeguard consumers from hazardous content including photographs of child sexual abuse. The bill, which is expected to become law by the end of the year, will be enforced by Ofcom, the communications regulator, and will carry the prospect of a multibillion-pound penalties if it is broken.

The bill also threatens tech leaders with criminal charges if they obstruct an Ofcom inquiry. According to the government, senior firm executives will risk civil penalties if their companies do not properly respond to requests for information under the DMU.