Amazon, Apple, Facebook and Google could be forced to overhaul their business practices as part of an expanded new package of antitrust reforms introduced on Friday by a bipartisan group of House lawmakers.
The five-bill package, previously reported by CNBC and other outlets, would make it harder for dominant platforms to complete mergers and prohibit them from owning companies with obvious conflicts of interest. The legislation represents the most comprehensive effort to reform century-old antitrust laws in decades.
Bills will have to be voted in favor by the judicial committee before reaching the full House. They would also have to be approved by the Senate before they can be promulgated by the President.
The moves follow a lengthy investigation by the House Judiciary Subcommittee into the antitrust laws of the four companies that was completed last year.
The panel found at the time that Amazon, Apple, Facebook and Google held monopoly power and that antitrust laws should be revised to better cope with the unique challenges of competing in digital markets.
While Democrats and Republicans have differed over some of the solutions, they generally agreed on the alleged competitive prejudice and that reform was needed to revitalize markets.
Two of the new bills introduced on Friday could prove particularly difficult for Amazon and Apple to navigate, given that both operate markets that include their own products or applications that compete with those of other vendors or developers who matter. on their services – a risky configuration under the new legislation. These bills include the Platform Anti-Monopoly Act (which appears to be renamed the American Choice and Innovation Online Act), sponsored by the House Judiciary Subcommittee on Antitrust David Cicillin, DR.I. and the Ending Platform Monopolies Act, sponsored by Vice President Pramila Jayapal, D-Wash.
Bills, in draft form, have already inspired the retreat of tech-funded groups.
“Adopting the European regulatory model would make it more difficult for US technology companies to innovate and compete both here and around the world,” said Geoffrey Manne, president and founder of the International Center for Law & Economics, in a press release. The group has received funding from Google in the past.
Adam Kovacevich, CEO of the center-left advocacy group Chamber of Progress, backed by Amazon, Facebook and Google, among others, posted an article on Medium earlier this week, saying consumers would lose more than a dozen features popular if these two bills were passed. .
Under these proposals, Kovacevich argued, Amazon would not be able to offer Prime free shipping for certain products, and Google would not be able to provide users with the most popular results for businesses in their region due to the rules. against discrimination on their platforms. He also wrote that Apple would not be allowed to pre-install its own “Find My” apps on its devices to help users locate lost items and that Facebook could not allow easy cross-posting to Instagram, also in because of the conflict of interest. and non-discrimination provisions.
Despite the technological setback, bipartisan support for the bill is a tremendous signal to the industry. The industry has inspired a rare collaboration between Democrats and Republicans, who both believe tech companies have too much power and worry about stagnating innovation.
Some tech companies that have criticized tech giants in the past have applauded some of the bills.
Spotify Chief Legal Officer Horacio Gutierrez called the American Choice and Innovation Online Act “an important step in tackling anti-competitive behavior in the App Store ecosystem, and a clear sign that momentum has grown. changed as the world wakes up to the need to demand fair competition in the app economy.
“Roku congratulates Representatives David Cicillin and Ken Buck for taking a critical step in tackling predatory and anti-competitive behavior by some of the country’s most powerful companies,” the company said in a statement. “Roku has first-hand experience of competing and interacting with these monopolies, and we’ve seen how they blatantly ignore antitrust laws and harm consumers by leveraging their dominance in one industry to stifle the market. competition in another. An aggressive package of reforms is needed to avoid a future where these monopolies further abuse consumer choice and hamper access to innovative and independent products.
Here’s a look at the five bills announced on Friday:
- Law on the end of platform monopolies: Sponsored by Jayapal, whose district includes Amazon’s headquarters in Seattle, and co-sponsored by Representative Lance Gooden, R-Tex., This bill would make it illegal for a platform with at least 50 million US users. assets per month and a market capitalization of over $ 600 billion to own or operate a business with a clear conflict of interest. Illegal disputes would include anything that causes a company to favor its own services over those of a competitor or to disadvantage potential competitors who use the platform. Lawmakers have previously expressed concern that Amazon and Apple, which run their own platforms for sellers and developers respectively, could hurt competition due to a conflict of interest for their own products or competing applications.
- U.S. Online Choice and Innovation Act: This bill, proposed by Cicillin and co-sponsored by Gooden, would prohibit dominant platforms from giving their own products and services any advantages over those of competitors on the platform. It would also prohibit other types of discriminatory behavior on the part of dominant platforms, such as cutting off a competitor who uses the platform from the services offered by the platform itself, and prohibiting dominant platforms from using data collected on their services that are not public for others to power their own competing products, among several other prohibitions.
- Competition Law and Platform Opportunities: 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 with the same criteria as the previous bill) to prove that their acquisitions are indeed legal, rather than the government having to prove that they will reduce competition. The measure would likely significantly slow acquisitions by dominant technology companies.
- Law on Increasing Compatibility and Competition by Enabling Switching of Services (ACCESS): This 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 of data portability and interoperability, which would allow consumers to more easily take their data with them to other platforms.
An Act respecting the modernization of merger filing fees: This bill, introduced by Representative Joe Neguse, D-Colo., And co-sponsored by Representative Victoria Spartz, R-Ind., Appears to be complementary legislation to the bipartisan bill of the same name in the Senate. The Senate version was passed in this chamber on Tuesday as part of a larger $ 250 billion technology and manufacturing bill. The bill would increase the fees companies pay to notify the Federal Trade Commission and the Department of Justice’s antitrust division of major mergers in an attempt to raise funds for these agencies.