EU/US: Online platform regulation hurts innovation, says ABA

The American Bar Association’s (ABA) antitrust and international sections have warned the European Commission that any regulation of online platforms may fail to keep up with the market.

According to the ABA, “[o]nline platforms drive innovation and growth in the digital economy. They play an important role in the development of the online world and opening new market opportunities, notably for SMEs. […] Online platforms offer major new efficiencies in accessing global consumer markets.” The Sections recognize, however, that some competitors have expressed concern regarding the operation of some platforms in the EU.

As the Commission recognizes “the (EU) competition rules … prohibit, inter alia, abusive behavior by platforms that are found to be dominant on the relevant markets(s) where they operate.” As the Commission notes, online platforms are in their essence a “gateway to markets” for businesses with goods to sell. As a general matter, online platforms are not situated differently from other avenues to market—such as traditional wholesalers—merely because they involve software and the internet. And as such, online platforms remain equally subject to the well-established competition laws.

The ABA concludes that the EU imposing significant burdens on integrated platforms could lead them to limit or terminate third-party access to their platforms through lawful means and thus reduce competition rather than expand it.

Full Content: American Bar Association

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