On Tuesday the European Commission will publish new rules that threaten American technology giants loss to 10% of annual income in case of violations. Extreme measures include a complete ban on the European market.
Antitrust EU Commission on Tuesday is preparing to introduce a new “Law on digital services” and the attached “Law on digital markets”, which include strict rules for conducting business of the Internet giants, the US is a large market of 27 countries.
The changes will affect Google Google (GOOGL, GOOG), Apple (AAPL), Amazon (AMZN), Facebook (FB), Microsoft (MSFT) and many others. “The law about digital services” aimed at the large online platforms, for example, with over 45 million users.
The question of the adoption of the new legislation is long overdue because the existing laws date back to 2004, when many of today’s Internet giants either did not exist or was just beginning to grow.
Unlike the earlier antitrust investigations the EU, followed by fines under the new laws, the EU authorities can resort to “extreme measures”, up to the deprivation of access to the European market.
However, these measures will follow against the technological giants “in the case of serious and repeated violations of law which threaten the security of European citizens”.
The laws also provide for higher fines – from 6% to 10% of the annual income of the company for violation of some of the most serious rules.
“The law about digital services” is largely focused on social networking platforms, to tighten control over the data collection practices of competition, as well as greater combat illegal content, misinformation and deliberate manipulation of the platforms to influence elections and public health, among others.
Companies will need to display the details of political advertising on their platforms and the parameters used in their algorithms for proposals and ranking information.
“The law on the digital markets of the EU” seeks to give Brussels new powers for faster enforcement of competition laws and provide greater transparency of its algorithms and use of personal data.
Technical giants will need to inform the EU of any intended mergers or acquisitions in accordance with the rules, said Monday the Commissioner of the block for industry Thierry Breton.
European and U.S. regulators are increasingly concerned that large technology companies have used the practice acquisitions as a way to prevent potential competitors. So, at the moment the Federal trade Commission (FTC) and 48 state attorneys States filed two separate antitrust lawsuit against Facebook, which threaten the Department of Instagram and WhatsApp.
Google threatened proceedings relating to the acquisition of YouTube and Waze.
Public presentation of bills will reveal the details and specific position of the Antimonopoly body of the EU, but before they are ratified and implemented can go a long time – from several months to years.
The process is complicated by the different position of the countries-EU members – some as, for example, France, Germany and the Netherlands is in favour of stricter rules against big tech companies, while others are concerned about over regulation and the impact on innovation.
In addition, the process of ratification is complicated by the influence of lobbyists, companies and trade associations that will influence the adoption of final rules.
It is expected that technology companies called for the adoption of proportional and balanced laws, and will use these circumstances to lobby for more lenient rules. Still, a technology company, the United States received large fines from European regulators, but they did not significantly affect their income or the amount of profit.
