Tech Giants Prepare for EU’s Sweeping Crackdown on Anti-Competitive Practices

Major players in the tech industry are bracing themselves for the European Union’s most substantial crackdown on anti-competitive practices within the digital economy. This impending action could potentially spark a fresh wave of legal conflicts between regulatory bodies and tech giants.

As reported by Bloomberg, antitrust regulators are set to unveil, by September 6, a list of services that will likely encompass Alphabet Inc.’s Google Search, Apple Inc.’s App Store, Amazon.com Inc.’s marketplace, and Meta Platforms Inc.’s Facebook. These services are slated to be targeted by new regulations aimed at preventing the most influential companies from stifling emerging markets before corrective measures can be taken.

The forthcoming Digital Markets Act (DMA), slated to take effect early next year, will establish a stringent framework of regulations that will apply to companies that have previously operated with relative impunity, despite undergoing numerous investigations that resulted in substantial fines and tax liabilities. Under the DMA, it will become illegal for certain platforms to prioritize their own services over those of competitors. They will be prohibited from amalgamating personal data from different services, prevented from using data collected from third-party merchants to engage in competitive practices against them, and obligated to allow users to download apps from rival platforms.

Read more: EU Designates 19 Tech Giants For Stricter Online Content Rules

However, the path is being paved for some of these tech firms to engage in legal disputes with the EU, in the very courts that have previously dealt with challenges against years of post-facto antitrust enforcement.

According to Alexandre de Streel, the academic director of the digital research program at the Centre on Regulation in Europe, “There is likely to be litigation coming.” He added, “Defining the services to be covered hasn’t been as easy as had been expected,” as reported by Bloomberg.

During a meeting between Apple and members of EU competition chief Margrethe Vestager’s cabinet on June 27, Apple expressed concerns about compliance challenges with the new rules. They highlighted worries about the scope of their services that would fall under the DMA’s purview and how user experiences could be safeguarded in this new regulatory landscape. These concerns have set the stage for potential legal clashes between tech giants and EU regulators.

Source: Bloomberg