EU Poised To Intensify Offensive vs Huge Tech Firms

The European Union’s proposed Digital Markets Act (DMA) contemplates extensive regulation of “gatekeeper” digital platforms—firms that perform a “core platform service” in the European Union have a significant impact on the EU internal market, serve as an important gateway between business users and end-users, and enjoy an entrenched and durable position.

Photo Insert: Amazon is one of the companies on the EU list

Although a couple of European firms would qualify as gatekeepers, Gary Clyde Hufbauer and Megan Hogan of the Peterson Institute for International Economics (PIIE) said in their Policy Brief for February 2022 that the DMA discriminates against US technology firms by singling them out for the label of “gatekeepers."

The DMA targets both US tech giants such as Google, Amazon, Facebook, Apple, and Microsoft and smaller, albeit huge, US tech firms such as Airbnb, Oracle, PayPal, and Zoom.

The authors say the EU goal is to confer a competitive advantage on European digital firms, breaching the EU commitment to national treatment of foreign firms, violating their intellectual property rights, and imposing high expenses on the “gatekeepers.”

At the same time, France is planning to enact its own steep barriers against US and other foreign cloud services. The technology giants are not uniformly beloved in the US either, where Congress has found bipartisan support for new regulation that would restrain their power.

But unlike the DMA, these proposals apply equally to US and foreign tech firms. A much stronger US response is needed to ensure that the proposed EU rules do not deter US tech firms and equally apply to EU firms that compete with them.

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