Wednesday, February 1, 2023

Big Tech says working with EU or facing patchwork of national laws

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Margrethe Vestager has warned that big tech companies would face a wave of countries passing laws to limit their power if they do not support the EU’s approach to regulation.

Ms Vestager, who is both EU competition chief and digital policy chief, said it was in the best interests of Google, Facebook and Amazon to work with Brussels if they wanted to avoid “a completely fragmented European legal system ”.

The EU recently presented proposals for new legislation that will cover the bloc – the Digital Markets Law and the Digital Services Act – designed to create fairer playing conditions and to make online platforms more responsible for the content published on them.

Senior officials in Brussels want to “act quickly” to enact the new rules, after a year in which the Covid-19 pandemic has accelerated the move online.

Some are hoping the legislation can be in place in 18 months if the rules can avert the years of wrangling that has beset other recent tech regulatory texts.

But EU officials are also concerned that some member states are taking unilateral action due to political pressure to curb the tech giants.

“We are concerned that countries are rushing towards legislation and will seek to delay negotiations so that the rules of the game can be established before the commission,” said a person involved in the process.

France, Germany, Denmark and Austria have all adopted national laws, and Hungary is also reportedly considering introducing its own rules.

Big Tech lobbyists said these efforts would undermine the EU’s attempts to have a single set of pan-European rules. But Ms Vestager said she saw the national efforts as an “encouragement”.

“I think that’s really a very strong argument to say to the platforms: ‘Well, either you have this or you would have a completely fragmented European legal system. “”

She added: “The French and the Germans and indeed a number of other member states, they are pushing it for exactly the same reasons we are pushing it.

“[EU legislation] can be strict, it can impose a lot of obligations and a number of restrictions on what they can do, but at least it has a pan-European scale.

She said regulators took a long time to put the brakes on Big Tech because officials were initially in awe of the companies.

“Until recently, we were fundamentally very impressed. These giants have also brought a number of very important innovations to our digital economy. They enabled a small trader to do e-commerce. They allow us to find things on the Internet.

“It took a while because we needed the wake-up call from the Cambridge Analytica scandal, of the various antitrust cases, to see that it is systemic. “

Margrethe Vestager spoke to the FT in an interview for the FT News Briefing podcast, which is available here.

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