US Lawmakers Unveil Five Bipartisan Bills To Unwind Amazon, Apple, Facebook And Google Monopolies

by Bhaswati Guha Majumder - Jun 12, 2021 11:04 AM
US Lawmakers Unveil Five Bipartisan Bills To Unwind Amazon, Apple, Facebook And Google Monopolies Google, Apple, Facebook and Amazon — The GAFA.

Lawmakers belonging to the Democratic Party in the United States House Of Representatives introduced five new bills on 11 June aimed at eroding the power of large tech companies—Amazon, Apple, Facebook and Google—focusing on a variety of practises that antitrust lawmakers say stifle competition.

These measures are the result of a 16-month long investigation by the House Judiciary Committee into the commercial practises of big tech giants.

The five bills would make it more difficult for dominating platforms to merge and would prevent them from owning businesses with clear conflicts of interest.

Before moving on to the full House, the bills must pass the Judiciary Committee with a favourable vote and also have to be passed by the Senate before the president could sign them into law.

After the completion of the investigation last year, the panel concluded that monopoly power exists among these tech behemoths and that antitrust rules should be updated to address the specific obstacles of competition in digital marketplaces.

While Democrats and Republicans disagreed on some ideas, they largely agreed on the purported competition harm and the need for reform to re-energize the markets.

As per the Financial Times, while announcing the bill, the House Judiciary subcommittee on antitrust Chairman Rep. David Cicilline said: “Right now, unregulated tech monopolies have too much power over our economy.”

He also noted that big tech firms are in a unique position to pick winners and losers, destroy small businesses, raise consumer prices, and put people out of work.

Ken Buck, the most senior Republican on the antitrust subcommittee, said that these tech giants have “prioritised power over innovation” and affected American businesses, as well as consumers in the process.

The bills would implement many of the recommendations made in a 448-page report issued by Cicilline's subcommittee in 2020 that accused these companies of abusing their market power and followed hearings, one of which featured the four CEOs.

However, Mitch McConnell, the Republican leader in the Senate, is widely regarded as a supporter of big business, but he has said little about these tech giants.

But Neil Bradley, the Executive Vice President, Chief Policy Officer and Head of Strategic Advocacy at the US Chamber of Commerce, said: “Bills that target specific companies, instead of focusing on business practices are simply bad policy and are fundamentally unfair and could be ruled unconstitutional.”

Even some tech-funded groups also criticized the bills.

As reported by CNBC , Geoffrey Manne, the president and founder of the International Center for Law & Economics, which received funding from Google earlier, said: “Adopting the European regulatory model would make it harder for American tech companies to innovate and compete both here and globally.”

Meanwhile, some of the bills were hailed by Spotify and Roku who have previously been critical of the tech behemoths.

Spotify said this is clear evidence that the tide is turning and that the world is waking up to the need for fair competition in the App economy.

Roku said in a statement: “It has firsthand experience competing against and interacting with these monopolists, and we’ve seen how they flagrantly ignore antitrust laws and harm consumers by leveraging their dominance in one line of business to stifle competition in another.”

“An aggressive set of reforms is needed to prevent a future where these monopolists further abuse consumer choice and hamper access to innovative and independent products,” the company added.

However, each of the bills saw at least one Republican and one Democrat sign on but it is still uncertain whether each of these measures has the approval of all the lawmakers.

The Bills

Ending Platform Monopolies Act would make it illegal for a platform with at least 50 million monthly active American users and a market cap of more than $600 billion to own or operate a business that is clearly in a conflict of interest.

Anything that incentivizes a firm to favour its own services over those of a competitor, or disadvantages future competitors who use the platform, would be considered an illegal conflict.

American Choice and Innovation Online Act would make it illegal for dominant platforms to give their own products and services an advantage over those of competitors.

Additionally, it would restrict such platforms from engaging in other types of discriminatory behaviour, including blocking a competitor from using the platform's services and prohibit dominant platforms from using data collected on their services that aren't available to the public to fuel their own competing products.

Platform Competition and Opportunity Act would shift the burden of proof in merger cases to the dominant platforms to prove that their acquisitions are legal, instead of the government having to prove that they will reduce competition.

It would also significantly hinder major tech businesses' acquisitions.

Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act would direct tech giants to adhere to particular data portability and interoperability standards, making it easier for users to transfer their data to new platforms.

Merger Filing Fee Modernization Act aims to collect money for the Federal Trade Commission and the Department of Justice Antitrust Division by increasing the fees firms pay to alert them of big acquisitions.

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