Q2 Tech Policy Round-Up

The biggest tech policy development of Q2 hit right at the end of the quarter, with the Prime Minister announcing plans to restrict social media access for under-16s. The announcement followed months of Parliamentary pressure, a government consultation on children’s social media use, and growing political focus on online safety. 

For UK tech and digital advertising businesses, the key takeaway from Q2 is that there is growing appetite from Government for policy intervention, particularly in relation to online safety. At the same time, the Government is continuing to talk up the importance of regulation that supports growth, innovation and investment. Balancing those two objectives is likely to be one of the big, tricky policy challenges for the rest of the 2026 and beyond.  

Online safety moved from consultation to action 

Children’s online safety dominated much of the quarter. The Children’s Wellbeing and Schools Bill completed its Parliamentary passage, but not before Peers pushed hard for the Government to go further and include provisions to restrict under-16 access to social media. In the end, a ban didn’t make it into the final wording of the Act, but Ministers were forced to give assurances that further action was coming. 

Government promised further action, and they have delivered. On 15th June the Prime Minister announced plans to prevent under-16s from accessing in-scope social media services, alongside a wider package of online safety measures designed to enhance protections for children and young people.  

There is still a lot we do not know. Much of the practical detail on the platforms that will be included, enforcement, technical standards and age assurance will follow in secondary legislation and Ofcom guidance. The Government is also due to set out its position on outstanding consultation proposals, including raising the age of digital consent, by 16th July. All we know so far can be found here.  

Digital advertising is not a focus of this intervention, but the implementation of the wider package matters. Age assurance, digital consent, platform design requirements and technical standards could all have implications for ad-funded businesses, particularly where they affect access, audience data, service design or compliance costs. 

AI and growth were major buzzwords 

AI remained central to the Government’s growth narrative this quarter. Tech Secretary Liz Kendall used a major speech to stress the importance of AI sovereignty, while the Government announced a £500m investment to scale domestic AI firms and confirmed that the Sovereign AI Unit in London is now operational. 

For digital advertising, this matters because AI is already part of the sector’s infrastructure, from optimisation and measurement to creative development and fraud prevention. The policy challenge will be ensuring that the UK supports responsible AI adoption without creating rules that make innovation harder, particularly for smaller businesses. 

This was the focus of IAB UK’s own work this quarter. In May, we launched Powering Growth: The UK’s Hidden AI Engine with Public First, highlighting the economic opportunity created by AI adoption across digital advertising and making the case for a balanced, growth-focused approach to AI regulation. 

Regulators were asked to think more about growth 

Another important Q2 theme was the Government’s focus on regulatory reform. The King’s Speech confirmed plans for a Regulating for Growth Bill, which is expected to strengthen the Growth Duty on regulators and encourage wider use of regulatory sandboxes. 

This matters for tech and digital advertising businesses operating across multiple regulatory regimes, including data protection, competition, online safety, advertising standards and AI. The Government’s message is that regulators should continue to protect consumers and markets, but should also be more focused on investment, innovation and economic growth. 

The Lords Industry and Regulators Committee also published its report on regulators and economic growth. The Committee’s recommendations picked up on issues IAB UK flagged to the Committee around regulatory certainty, coordination and accountability. We expect many of these themes to feed into the upcoming Bill. 

Data and competition: important developments for the ad-funded web 

The ICO published final guidance on storage and access technologies, confirming that advertising activities cannot rely on the “strictly necessary” exception under PECR. However, the ICO has also advised Government on possible consent exemptions for lower-risk activities such as measurement and fraud prevention. The current direction of travel appears to be limited first-party exemptions, which would deliver only modest benefits for publishers and the wider ad supply chain. 

DSIT is expected to consult on the detail of new PECR exemptions in the coming months, and IAB UK will continue making the case for an approach that supports responsible, privacy-preserving advertising while maintaining user trust. 

The CMA also made a significant intervention under the digital markets’ competition regime, requiring Google Search to provide tools for publishers to control how their content is used to power AI features. This world-first opt-out requirement could have wider implications for debates about AI, copyright and the value exchange between platforms and publishers. 

Advertising policy continued to evolve 

Advertising-specific policy also continued to move. The Tobacco and Vapes Bill completed its Parliamentary passage and will introduce a ban on ads for vaping products, extending the existing ban on tobacco to vapes, nicotine products and related products.  

On less healthy food and drink (LHF) advertising, the ASA issued its first rulings under the LHF regime which gave the industry the first practical examples of how the new rules are being enforced. At the same time, the Government is also consulting on whether to adopt the 2018 Nutrient Profiling Model for the LHF restrictions. IAB UK remains concerned that further changes to the scope of the LHF regime so soon after implementation - and before a robust impact assessment has been undertaken - risks creating exacerbating impacts on the digital advertising sector. We’ve responded to the consultation to set out our concerns and emphasize the need for Government to allow time for the policy to bed-down before considering any changes to scope.  

Political uncertainty remains the backdrop 

Crucially, all of this policy change is happening against a turbulent political backdrop. The quarter saw local election pressure on Labour, Cabinet resignations, speculation about Keir Starmer’s leadership and a King’s Speech setting out the Government’s new legislative agenda. 

That matters because policy does not develop in a vacuum. Political pressure can accelerate action, particularly on high-profile issues such as children’s online safety, but it can also increase the risk of rushed policymaking and unintended consequences for industry.  

As we move into Q3, the key things to watch will be the implementation detail behind the social media ban and wider online safety package, the upcoming PECR consultation, the Regulating for Growth Bill, and how the digital markets regime develops in practice.