EU Threatens Big Tech Breakup Over Anti-Competitive Practices

As Brussels published its tech legislation drafts, the European Union (EU) warned that it would break up Big Tech for repeated practices that are deemed anti-competitive, the Financial Times (FT) reported on Tuesday (Dec. 15).

If adopted, the Digital Services Act (DSA) and the Digital Markets Act (DMA) will have repercussions for digital service providers both in the EU and outside it. The regulations would essentially hold tech companies responsible for any illegal behavior on their platforms.

The proposals are scheduled to be published by the European Commission (EC) on Tuesday (Dec. 15), and a vote by the European parliament will be scheduled. There is no date scheduled yet for the launch of the new rules. 

Companies breaking the rules would face steep penalties — as high as 10 percent of their global revenues. Big Tech firms that don’t police their platforms could be penalized up to 6 percent of their global revenues.

The DMA draft indicates that if a company is deemed to be a repeat offender — penalized three times within five years — the EU can break up the businesses, FT reported, citing sources.

The EU could also hand down “remedies which are proportionate to the infringement committed and necessary to ensure compliance,” according to the draft regulation.

If passed, the new Big Tech rules will be the strictest in the world. 

The EU ruled last week that fines were on the horizon pending new regulations. Part of the new rules mandates that Big Tech turn over data about their process of dealing with illegal content. Tech companies would have to hire one or more compliance officers. Rules would also demand more transparency for online advertising.