Amazon, Apple, Facebook and Google may be forced to revise their business practices during a new comprehensive set of antitrust reforms introduced by a two-party group of lawmakers in the House on Friday.
The five-bill package, previously reported by CNBC and other businesses, would make it more difficult for dominant platforms to implement mergers and ban them from owning companies that pose clear conflicts of interest. The legislation represents the most comprehensive effort to reform hundred-year-old antitrust laws for decades.
The bills must be voted in favor of the Judiciary Committee before heading to the full house. They also had to be approved by the Senate before they could be signed into law by the President.
The measures come in the wake of a lengthy inquiry by the Judiciary Subcommittee on Monopoly on the four companies, which was closed last year.
The panel found at the time that Amazon, Apple, Facebook and Google possess a monopoly and that the monopoly rules should be revised to better address the unique challenges of competition in digital markets.
While Democrats and Republicans differ from some of the solutions, they mostly agreed on the alleged competition damage and that the reform was necessary to revive the markets.
Two of the new bills introduced Friday could prove particularly difficult for Amazon and Apple to navigate, as both operate marketplaces that include their own products or apps that compete with other vendors or developers who trust theirs. services ̵
The bills already inspired in their draft pushback from technology-funded groups.
“Adopting the European regulatory model would make it more difficult for U.S. technology companies to innovate and compete both here and globally,” Geoffrey Manne, president and founder of the International Center for Law & Economics, said in a statement. The group has previously received funding from Google.
Adam Kovacevich, executive director of the law firm Center-Left Chamber of Progress, backed by Amazon, Facebook and Google, among others, published a Medium post earlier this week, arguing that consumers would lose more than a dozen popular features if the two bills were to pass.
During these proposals, Kovacevich argued that Amazon could not offer Prime free shipping of some products, and Google could not serve users the most popular results for companies in their areas due to anti-discrimination rules on their platforms. He also wrote that Apple would not be allowed to pre-install its own “Find My” apps on its devices that help users find lost items. Facebook could not allow for easy cross-posting on Instagram, also due to conflicts of interest and non-discrimination provisions, Kovacevich argued.
Despite technical pushback, the two-party support for the bill is a formidable signal to the industry. The sector has rarely inspired collaboration between Democrats and Republicans, who both believe technology companies have come to have too much power and worry about stagnant innovation.
Spotify and Roku, which have previously been critical of the tech giants, welcomed some of the bills.
Spotify Chief Legal Officer Horacio Gutierrez called the American Choice and Innovation Online Act “as an important step in tackling anti-competitive behavior in the App Store ecosystem and a clear sign that momentum has shifted as the world wakes up to the need to demand fair competition” in the App Economy. “
“Roku welcomes representatives. David Cicilline and Ken Buck for taking a decisive step towards curbing the predators and anti-competitive behavior of some of the country’s most powerful companies,” the company said in a statement. “Roku has first-hand experience competing against and interacting with these monopolists, and we have seen how they openly ignore antitrust laws and harm consumers by exploiting their dominance in one industry to stifle competition in another. An aggressive approach is needed. reform to prevent a future in which these monopolists further abuse consumer choice and hamper access to innovative and independent products. “
Here is an overview of the five bills announced Friday:
- Ending Platform Monopolies Act: Sponsored by Jayapal, whose district includes Amazon’s headquarters in Seattle, and co-sponsored by Rep. Lance Gooden, R-Tex., Would this bill make it illegal for a platform with at least 50 million active U.S. users each month and a market value of over $ 600 billion to own or operate a business that constitutes a clear conflict of interest. Illegal conflicts will include anything that encourages a company to prefer its own services over competitors or disadvantaged potential competitors using the platform. Lawmakers have previously expressed concern that both Amazon and Apple, which operate their own platforms for sellers and developers respectively, could undermine competition due to a conflict of interest in their own competing products or apps.
- American Choice and Innovation Online Act: This bill, proposed by Cicilline and co-sponsored by Gooden, would prohibit dominant platforms from giving their own products and services advantages over competitors on the platform. It would also prohibit other forms of discriminatory behavior from dominant platforms, such as cutting off a competitor using the platform from services offered by the platform itself, and prohibiting dominant platforms from using data collected on their services that are not public to others. to burn their own competing products, among several other bans.
- Platform Competition and Sales Opportunity Act: This proposal from rep. Hakeem Jeffries, DN.Y., co-sponsored by subcommittee Ranking Member Ken Buck, R-Colo., Would shift the burden of proof in merger cases to dominant platforms (defined by the same criteria as the previous bill)) to prove that their acquisitions are in fact legal , rather than the government having to prove that they want to reduce competition. The measure is likely to significantly lower acquisitions from dominant technology companies.
- Increasing compatibility and competition by activating the Service Switching (ACCESS) Act: This proposed bill from rep. Mary Gay Scanlon, D-Pa., And co-sponsored by Rep. Burgess Owens, R-Utah, would require dominant platforms to maintain certain standards for data portability and interoperability, making it easier for consumers to take their data with them to other platforms.
- Modernization of Merger Fees Act: This bill, introduced by Rep. Joe Neguse, D-Colo., And co-sponsored by Rep. Victoria Spartz, R-Ind., Appears to be accompanying legislation to the two-party bill of the same name in the Senate. The Senate version was passed in this chamber Tuesday as part of a larger $ 250 billion tech and production bill. The bill raises the fees that companies pay to notify the Federal Trade Commission and the Department of Justice Antitrust Division of major mergers with the goal of raising money for these agencies.
This story unfolds. Come back for updates.
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