Wednesday, December 16, 2020

EU vs Big Tech: New rules, fines, and measures against tech giants in EU


EU Comission decided to put the foot down, and show Big Tech who runs the show. In a proposal of new rules for digital platforms that are meant to make Europe fit for the Digital Age, the European Commission prposed several Acts whose intended purpose is to better protect consumers and their fundamental rights online, as well as lead to fairer and more open digital market for everyone. In the name of European values. Nobody know what those are, but they do always sound nice.

Concretely, the Digital Markets Act will:

Apply only to major providers of the core platform services most prone to unfair practices, such as search engines, social networks or online intermediation services, which meet the objective legislative criteria to be designated as gatekeepers;

Define quantitative thresholds as a basis to identify presumed gatekeepers. The Commission will also have powers to designate companies as gatekeepers following a market investigation;

Prohibit a number of practices which are clearly unfair, such as blocking users from un-installing any pre-installed software or apps;

Require gatekeepers to proactively put in place certain measures, such as targeted measures allowing the software of third parties to properly function and interoperate with their own services;

Impose sanctions for non-compliance, which could include fines of up to 10% of the gatekeeper's worldwide turnover, to ensure the effectiveness of the new rules. For recurrent infringers, these sanctions may also involve the obligation to take structural measures, potentially extending to divestiture of certain businesses, where no other equally effective alternative measure is available to ensure compliance;

Allow the Commission to carry out targeted market investigations to assess whether new gatekeeper practices and services need to be added to these rules, in order to ensure that the new gatekeeper rules keep up with the fast pace of digital markets.

As Rappler puts it:

A source close to the EU commission said ten firms faced being designated as "gatekeepers" under the competition legislation and subjected to specific regulations to limit their power to dominate markets.

The firms that would be subject to stricter regulation are US titans Facebook, Google, Amazon, Apple, Microsoft and SnapChat, China's Alibaba and Bytedance, South Korea's Samsung and the Netherlands' Booking.com.

You can read the whole EU draft here.

I found this bit to be of interest:

Platforms that reach more than 10% of the EU's population (45 million users) are considered systemic in nature, and are subject not only to specific obligations to control their own risks, but also to a new oversight structure. This new accountability framework will be comprised of a board of national Digital Services Coordinators, with special powers for the Commission in supervising very large platforms including the ability to sanction them directly.

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