Democrats’ antitrust bills could reshape Apple, Amazon, Google, Facebook

US House of Representatives impeachment manager David Cicilline (D-RI) speaks on the second day of former President Donald Trump’s second impeachment trial at the US Capitol on February 10. 2021 in Washington, DC.

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A group of House Democrats is circulating discussion drafts of antitrust bills that would force the largest tech companies to change parts of their business models and restrict large acquisitions, according to copies obtained by CNBC.

While the drafts could still change significantly before their introduction, as currently written, they could require business model reviews for Apple and Amazon by limiting their ability to operate product and app markets while selling their own products and apps in those same stores. .

The bills would also make it harder for those companies, in addition to Facebook and Alphabet (Google’s parent company) to complete major mergers, and would force them to make it easier for users to leave their platforms with their data intact. CNBC could not immediately know when the drafts will be released.

The bills come after a 16-month investigation by the House judicial subcommittee on antitrust at the four companies, culminating in a nearly 450-page report from Democratic staff last fall. While the Republicans on the subcommittee departed from some of the Democrats’ more extreme proposals, several agreed with the main findings of monopoly power and anti-competitive behavior in the Democratic report and on the need to control the power of big technology. with an antitrust reform.

The drafts do not indicate whether any Republicans are supporting the bills.

What the bills say

Specifically, the five discussion drafts would prevent platforms from owning businesses that present a conflict of interest, prevent large platforms from favoring their own products over those of competitors that rely on their sites, make it difficult for large platforms to complete mergers, and increase filing fees. for acquisitions and forcing users to transfer their data between platforms.

One of the bills, sponsored by Rep. Joe Neguse, a Colorado Democrat, appears to be supplemental legislation to the bipartisan Senate Merger Filing Fee Modernization Act, which passed in that chamber Tuesday as part of a $ 250 billion technology and manufacturing bill. That bill would increase the fees companies pay to notify the Federal Trade Commission and the Justice Department’s Antitrust Division of major mergers to raise funds for those agencies.

The other four drafts obtained by CNBC include:

  • Law to end platform monopolies: Sponsored by Rep. Pramila Jayapal, D-Washington, vice chair of the subcommittee, this bill would make it illegal for a platform with at least 500,000 monthly active users in the US and a market capitalization of more than $ 600 billion to possess. or operate a business that presents a clear conflict of interest. The draft defines an illegal conflict as one that encourages a company to favor its own services over those of the competition or harms potential competitors who use the platform. Lawmakers have previously raised concerns that both Amazon and Apple, which run their own platforms for sellers and developers, respectively, could undermine competition due to a conflict of interest for their own competing products or apps.
  • Platform Opportunities and Competition Law: This proposal from Representative Hakeem Jeffries, DN.Y., would shift the burden of proof in merger cases to the dominant platforms (defined with the same criteria as the previous bill) to demonstrate that their acquisitions are in fact legal, instead of the government. having to show that they will reduce competition. The move would likely slow down acquisitions by dominant tech firms substantially.
  • Platform Antitrust Law: This bill, proposed by subcommittee chair David Cicilline, DR.I., would prohibit mainstream platforms from giving advantages to their own products and services over those of competitors on the platform. It would also prohibit other types of discriminatory behavior by dominant platforms, such as excluding a competitor who uses the platform from the services offered by the platform itself, and it would prohibit dominant platforms from using data collected on their non-public services. for others to feed. its own competing products, among several other prohibitions.
  • Increased compatibility and competition by enabling the Service Change Act (ACCESS): This bill proposed by Rep. Mary Gay Scanlon, D-Pennsylvania, would force mainstream platforms to maintain certain data portability and interoperability standards, making it easier for consumers to move their data to other platforms.

Representatives for those legislators did not respond or provide comment on the discussion drafts.

Axios first reported on the drafts.

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NOTE: Big tech may face even greater scrutiny for antitrust and monopoly laws in 2021. Here’s why

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