A protest against the multinational technology company Amazon during the COVID-19 pandemic in Rome, Italy on November 27, 2020.
Antonio Masiello | Getty Images News | Getty Images
When Italy’s competition regulator imposed a massive 1.13 billion euro ($1.28 billion) fine on Amazon last month, it was just the latest salvo in a string of moves against Big Tech.
The watchdog, Autorita Guarante della Concorenza e del Mercato, drew a flurry of rulings last year against e-commerce giant, Alphabet’s Google and Facebook’s owner Meta, to name a few.
In the case of Amazon’s latest fines, the regulator took issue with a firm encouraging Italian sellers to use its own logistics service, Fulfillment by Amazon, which the watchdog said was an abuse of its dominant position. This is an allegation that Amazon denies.
Renaud Foucart, a senior economics lecturer at the UK’s Lancaster University, told CNBC that substantial monetary clearances on occasion are part of a trend of national regulators acting against Big Tech firms because wider EU-level investigations may be “too slow”. Is.
“National regulators want to show that they are proactive, that they are actually doing something,” he said.
AGCM has been very active. During 2021, it imposed several fines against large US tech companies. In a separate case, it fined Amazon and Apple over alleged anti-competitive cooperation. It fined Google 102 million euros over “abuse of dominant position” in its car software product, and in February, fined Facebook 7 million euros over its use of data.
Sanctions vary greatly in their size but carry a similar message: National regulators will take action in their domestic markets.
But regulators like AGCM will not go without challenging their decisions. Amazon fired back against the order and plans to appeal the $1.28 billion fine.
“The proposed fines and measures are unfair and disproportionate,” a spokesman said.
regulatory capacity under pressure
Maria Luisa Stasi, a senior legal officer at Article 19, a digital rights non-governmental organisation, said it is not surprising that some national watchdogs, such as those in Italy as well as France and Germany, are so strongly against Big Tech. has taken its own initiative to take steps from ,
“Some competition authorities in Europe are more willing to conduct field inquiries or market studies where they feel there is an environment where certain problems may occur, rather than waiting for complaints to arrive,” he said.
He said it is no coincidence that these investigations are taking place in markets with large populations, with more developed digital audiences and consumers.
“The biggest cases we are seeing in Europe at the moment have been some kind of endorsement by consumer associations or individuals coming together, if not the initiative,” she said. “It’s more bottom-up push.”
However, she said, there will be budget, resources and capacity issues, with regulators of all sizes facing obstacles with increasingly large digital workloads.
Scrutinizing through evidence and data, especially in the case of the giant and global businesses of Big Tech, there is a great deal of elbow grease that can affect budgets and information.
“If you put multiple protocols or codes on my desk, I won’t be able to tell you whether that software has been a tool for the cartel or not because I haven’t been able to read it. It can slow down the process.” . A lot.”
It said it favors regulators taking interim measures against companies, for example ordering a halt or ban on specific activity during the investigation, rather than waiting until the investigation is over, which can take years. .
Other competition watchdogs have set up specialist units to address Big Tech. The UK Competition and Markets Authority, which has recently stepped up its own actions against the big digital players, last year established a dedicated technical unit to investigate the digital giants. Most notably, CMA is locking horns with Facebook over its Giphy acquisition.
Major overhaul underway in Europe
While the likes of AGCM have acted on their own, the dynamics of competition regulation in Europe, particularly around Big Tech, is about to undergo a significant change.
The Digital Markets Act is a comprehensive set of new EU rules that are still in the womb but close to the finish line. This would be a high priority for the Council of the European Union, where government ministers meet to adopt laws, which is currently led by France.
The DMA will tighten rules for big tech companies – the so-called gatekeepers – who are dominant in the market to prevent abuse. It will also initiate greater scrutiny of deals on mergers and acquisitions.
The European Commission, the executive arm of the European Union, will investigate abuses or misconduct by these gatekeepers.
Luisa Stasi said that the question of capacity and resources also hangs on the DMA.
“Almost everything is going to be on the Commission’s desk. Is the Commission going to be able to do that? Again, a capability issue,” she said.
Meanwhile, other national regulators – whether in competition law or in other areas such as privacy and data protection – continue to take action.
“The Germans have been very active, the French have been very active in the past,” said Foucart of Lancaster University.
But many regulators need to bow down to the longer term, he said.
“If you get [against] One of those big companies, you still need to win in court later. They can appeal at the European level.”