Amazon, Apple, Facebook and Google may be forced to rethink their business practices as part of an extensive set of antitrust reforms introduced on Friday by a bipartisan group of House of Representatives.
The package of five bills, drafted by CNBC and other agencies, will make it difficult for dominant platforms to complete mergers and bar them from owning businesses that represent a clear conflict of interest. The legislation represents the most comprehensive attempt to reform a century-old antitrust law in decades.
Bills must be approved by the Judicial Committee before they enter the House of Representatives. They also need to be approved by the Senate before they can be signed into law by the President.
The move comes after a lengthy investigation by the House of Representatives Judicial Subcommittee on Antitrust Issues against four companies, which was completed last year.
The group concluded that at the time, Amazon, Apple, Facebook and Google have monopoly powers and that antitrust laws need to be revised to better deal with the unique challenges of competition in digital markets.
While Democrats and Republicans disagreed on some of the decisions, they generally agreed on the perceived damage to competition and that reform was needed to revitalize markets.
Two of the new bills introduced on Friday could prove particularly challenging for Amazon and Apple, as both operate in marketplaces that include their own products or applications that compete with other vendors or developers relying on their services – risky setting in the face of new legislation. These bills include the Platform Antitrust Policy Act – which appears to have been renamed the American Internet Choice and Innovation Act – sponsored by the House Judiciary Subcommittee under Antitrust Chairman David Cicillin, M.D., and the Platforms End Monopoly Act. sponsored by Vice Chair Pramila Jayapal, D-Wash.
The draft laws have already resonated with technology-funded groups in their draft form.
“Adopting a European regulatory model will make it harder for US tech companies to innovate and compete here and around the world,” said Jeffrey Mann, president and founder of the International Center for Law and Economics. In the past, the group has received funding from Google.
Adam Kovacevic, CEO of the center-left human rights group Chamber of Progress, supported by Amazon, Facebook and Google among others, posted a Medium post earlier this week claiming that consumers would lose more than a dozen popular features if the two bills were passed. … …
Under these proposals, Kovacevic argued, Amazon would not be able to offer Prime free shipping for some products, and Google would not be able to provide users with the most popular results for businesses in their regions due to rules that prohibit discrimination on their platforms. He also wrote that Apple will not be allowed to pre-install native Find Me apps that help users find lost items on their devices. Kovacevic argued that Facebook cannot allow simple cross-posting to Instagram, including due to conflicts of interest and non-discrimination provisions.
Despite the technical pullback, support for the bill by both parties is a strong signal for the industry. The sector has spurred rare collaboration between Democrats and Republicans, who both believe tech companies have become too powerful and worried about stagnating innovation.
Spotify and Roku, which have criticized tech giants in the past, have approved some of the bills.
Spotify Chief Legal Officer Horacio Gutierrez called the American Internet Choice and Innovation Act “an important step in tackling anti-competitive behavior in the App Store ecosystem and a clear sign that momentum has changed as the world realizes the need to demand fairness. Competition in the app economy.”
“Rocu applauds representatives David Chicillin and Ken Buck for taking a bold step towards containing the predatory and anticompetitive behavior of some of the country’s most powerful companies,” Rocu said in a statement. “Roku knows firsthand how to compete and engage with these monopolists, and we’ve seen them blatantly defy antitrust laws and harm consumers by using their dominance in one line of business to suppress competition in another. prevent a future in which these monopolists continue to abuse consumer choice and make it difficult to access innovative and independent products. ”
Here’s an overview of the five bills announced on Friday:
- Platform Monopoly Ending Law: This bill, sponsored by Jayapal, whose neighborhood includes Amazon’s Seattle headquarters and is co-sponsored by Rep. Lance Gooden, Texas, will make it illegal for a platform with at least 50 million monthly active US users and market capitalization. more than $ 600. billions of dollars to own or operate a business that presents a clear conflict of interest. Illegal conflicts can include anything that prompts a business to prioritize its own services over a competitor’s, or disadvantage potential competitors using the platform. Legislators have previously expressed concern that both Amazon and Apple, which have their own platforms for sellers and developers, respectively, could undermine competition due to conflicts of interest over their own competing products or applications.
- American Internet Choice and Innovation Act: This bill, proposed by Cicilline and co-sponsored by Gooden, will prohibit dominant platforms from giving their own products and services an edge over competitors’ products and services on the platform. It would also prohibit other types of discriminatory behavior on the part of dominant platforms, such as disconnecting a competitor using the platform from the services offered by the platform, and would prevent dominant platforms from using data collected in their services that are not publicly available to others as fuel. … their own competing products; and a number of other prohibitions.
- Competition and Platform Opportunities Law: This proposal from Rep. Hakim Jeffreys, NY, backed by Subcommittee Ken Bakka, California, USA, will shift the burden of proof in merger cases to dominant platforms to prove their acquisitions are legitimate. instead of the government arguing that they will reduce competition. This move is likely to significantly slow down acquisitions by dominant tech companies.
- Increased compatibility and competition through the inclusion of the Service Switching Act (ACCESS): The bill, proposed by Congressman Mary Gay Scanlon, PA, and sponsored by Congressman Burgess Owens, Utah, will oblige dominant platforms to maintain specific standards of data portability and interoperability, making it easier for consumers to data from them to other platforms.
- Merger Fee Modernization Act: The bill, introduced by Rep. Joe Negus, Colorado, and co-sponsored by Rep. Victoria Spartz, Indiana, appears to be an addition to the bipartisan Senate bill of the same name. The Senate version passed in this chamber on Tuesday as part of a larger $ 250 billion technology and manufacturing bill. The bill will increase the fees that companies pay to notify the FTC and the Department of Justice’s Antitrust Office of major mergers in order to raise money for these agencies.
This story is evolving. Keep for updates.
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