The EU may force big tech to sell companies to avoid abuses

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The law plans to impose fines of up to 10% of their annual income on the internet giants

The European Commission (EC) presented on Tuesday the new law on digital markets that provides for the possibility of forcing large internet platforms to sell their companies, as an extreme measure, to prevent their abuse of power in the market. “If it is the only adequate way to solve the problem, (…) structural separation or divestment may be a measure of last resort,” said community sources.

The law first provides for the possibility of imposing on the internet giants a fine of up to 10% of their annual income globally if they fail to comply with the obligations established by law to combat their dominance.

Brussels also presented the digital services law on Tuesday, which establishes fines for these companies of up to 6% of their global annual income if they do not remove illegal content from their web pages, even if it comes from third parties.

The EC understands that large platforms are those with more than 45 million active users per month or those that achieve an annual turnover in the European Economic Area (EEA) equal to or greater than 6,500 million euros in the last three years.

With these two regulations -which will still have to receive the approval of the European Parliament and the Council of the EU-, the Community Executive wants to update the 2000 electronic commerce law and equip itself with new tools to combat the power of big technology.

As the Commissioner for the Internal Market, Thierry Breton, explained to journalists, the rules that have been in force in the last 20 or 30 years to prevent abuse ” are not adequate ” in a digital environment that evolves very quickly.

The digital markets law will oblige the internet giants to previously notify the Community Executive of the purchase of another company so that the EC can see “if the acquisition is to do something prohibited,” the French politician explained. In particular, Brussels seeks to diminish the power of technology companies by preventing them from using the data of their commercial customers to improve their competition or by preventing them from forcing users to install specific applications or services.
The second of the laws, that of digital services will force technology companies to quickly remove illegal content from their web pages -even if it comes from third parties-, unless they are unaware that it is prohibited material. By illegal content, Brussels means for example the sale of fraudulent products or hate speech. It will also force them to have more transparency in the operation of the algorithms that recommend content to users.

Brussels will give internet giants freedom to operate in the EU country of their choice, but the rules will apply equally across the EU. In addition, technology companies -mainly from the United States- will be required to have a legal representative in Europe with whom the authorities can contact.

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