A bipartisan group of 30 lawmakers sent a letter to President Joe Biden urging him to talk to EU leaders and persuade them to change the proposed Digital Markets Act (DMA), as in their view, it “unfairly” targets U.S. tech companies.
According to CNBC, the group, led by Representatives Suzan DelBene and Darin LaHood, wrote in their letter that they “are greatly concerned that EU’s proposed approach to promoting competition among digital platforms unfairly targets American workers by deeming certain U.S. technology companies as ‘gatekeepers’ based on deliberately discriminatory and subjective thresholds.”
The DMA aims at tackling competition concerns with digital platforms. The proposed law establishes a list of activities that Big Tech companies must do or must refrain from doing, including self-preferencing of products in their own platforms, or opening up App stores. Similar laws have been introduced in the U.S. — the Open App Markets Act and the American Innovation and Choice Online Act — and both bills have passed the Senate Committees and are now on their way to the senate for a vote.
The DMA was approved by the EU Parliament back in December, but due to the complexities of the EU legislative system, it still needs to be ratified by the 27 member states. This ratification process may still last for a few months; it is expected to be fully ratified by summer, but during this time there is still a possibility of introducing amendments to the text. Nonetheless, given the agreement between all the EU institutions and member states, it is unlikely that a last-minute proposal could succeed because it would mean that the text would be back to the EU Parliament to get a new vote and new approval.
The main issue raised by U.S. lawmakers is that the DMA is targeting U.S. Big Tech companies in everything but name. “As European leaders have made clear, the DMA as currently drafted is driven not by concerns regarding appropriate market share, but by a desire to restrict American companies’ access in Europe in order to prop up European companies,” they wrote.
The DMA is not targeting only U.S. companies, as it includes all the digital platforms that meet certain criteria in terms of revenue and users. However, given the presence of U.S. companies in Europe and the smaller market share of other companies, the law will most likely affect Amazon, Google, Microsoft, Meta and Apple first. Additionally, other European companies such as Booking.com or Spotify are likely to fall under the scope of the DMA.
Read More: EU Council May Push for DMA, DSA Approval Before Summer
This letter comes the same day that the European Commission presented a new law, the Data Act, which may compel U.S. companies to share more data with EU companies and consumers. The proposed law won´t limit the capacity of U.S. firms to collect data from the web and from connected devices, but it will empower consumers by giving them the possibility to access and share their data with third parties much easier.
The Data Act will also allow small and medium companies in Europe to challenge abusive data-sharing agreements and to get more control over the data they generate. The proposed law will still need to go through the EU Parliament where amendments to the text are possible, and a final approval may not happen until the end of the year or beginning of 2023.
Sign up here for daily updates on the legal, policy and regulatory issues shaping the future of the connected economy.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More