Digital Competition: Acquisitions by Tech Giants Anger Europe

France, Germany, and the Netherlands are calling on the European Union to exert stronger pressure on large tech companies like Amazon, Google, or Facebook in the Proposal for Amendments to the Digital Markets Act, which regulates digital competition. In a letter sent to Brussels by the three countries, they request that oversight be strengthened and accelerated in cases where tech giants acquire development firms to incapacitate the emergence of competition. Sending such a letter is an extremely rare way for member states to address Brussels, but countries that have decided to start the fight against tech giants like France, Italy, and Germany want EU legislation to support them in this endeavor.

For a Stronger Approach

The signatories of the letter are dissatisfied with the slow and ineffective enforcement of rules and hope that changes to the Digital Markets Act will empower them more. They believe that national authorities should play a stronger role in cooperation with the European Commission, as the importance of digital markets is exceptional for their economies. Additionally, regarding the Proposal for the Digital Services Act, which encompasses online content, the Germans are seeking a firmer approach, such as banning advertising targeting minors. The Spanish and Danish ministers also agreed on a stricter approach at the EU ministers’ meeting.

Margrethe Vestager, the European Commissioner for Competition, emphasizes that there is cooperation with national bodies that has led to the Commission’s investigation against Facebook’s acquisition of the development company for chatbots in healthcare and education, Kustomer. An investigation has also been initiated regarding the acquisition of the development company for early detection tests for 50 types of cancer, Gral, conducted by the biotechnology company Illumina.

Corporate Rules

The EU aims to protect the fundamental rights of all users of digital services through these two laws and establish equal conditions to promote innovation, growth, and competitiveness in the European and global markets. The rules in the Digital Services Act pertain to social networks, online stores, content exchange platforms, travel and accommodation services, and app stores. The Digital Markets Act also regulates the rules for platforms that mediate access to information, known as ‘gatekeepers’, such as Google, Amazon, Facebook, and Apple. Such companies are powerful enough to impose rules themselves, and this needs to be addressed. The biggest challenges also include the trade and exchange of illegal goods, services, and content online, and online services also abuse manipulative algorithmic systems. 

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