EU: Tech giants face fines or even break-up if they breach new rules

European Union

Tech giants which violate new EU rules aimed at controlling their abilities could face penalties, be ordered to change their practices as well as be forced to break their European businesses, the bloc’s digital leader Thierry Breton has said.

Breton’s comments come two weeks before he’s due to current draft principles known as the Digital Services Act (DSA) and Digital Markets Act (DMA), which are likely to affect large US players Google, Apple, Amazon, Facebook and Microsoft.

The DSA will induce tech organizations to clarify their algorithms work, open their advertising archives to regulators and researchers, and also do more to tackle hate speech, damaging content and counterfeit products on their own platforms.

The DMA takes aim at online gatekeepers with a list of requirements, such as sharing certain kinds of data with rivals and authorities; and outlawed practices, like favouring their own services. It is going to also incorporate a variety of sanctions.

“We start with a fine, then you have a bigger fine, then you may have a temporary remedy, specific remedies, then you may have at the end of the day, what we have also in the competition rules, structural separation,” Breton told reporters through an online briefing.

Related Article:
Factbox: How social media services handle political ads

“So from fines to separations, but of course only on the European market,” he explained.

Forcing businesses to break up could be a last resort, ” said Breton, the EU’s internal market commissioner.

Significant technology companies seeking acquisitions may also be required to inform the European Commission – the EU executive body – of the intentions, Breton said.

“They may have an obligation to just inform us what they want to do, and then we will see if it fulfils all their obligations,” he said.

The projected laws are still some way from taking effect, however. The European Commission will need to negotiate with EU countries and the European Parliament to agree to the last legislation, a process which could take a couple of years.

The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Foo Yun Chee. Editing by Pravin Char.

Stay on top of the latest developments across the platform economy and gain access to our problem-solving tools, proprietary databases and content sets by becoming a member of our community. Premium subscription plans start at under $7 per month.

Related Article:
Twitter names ex Google CFO Pichette as chair, Kordestani to stay on
Share this article