EU names six Big Tech giants set to face new tough rules

(CN) — In its sweeping bid to rein in the dominance of Big Tech and regulate the internet, the European Union on Wednesday named six tech giants — five American companies and one Chinese — as internet “gatekeepers” that must comply with a set of new rules meant to level the playing field and curb unfair profiteering.

European regulators labeled Alphabet, Amazon, Apple, Meta and Microsoft along with ByteDance, the Chinese owner of TikTok, as so-called “gatekeepers” under the EU's Digital Markets Act.

The law was adopted in September 2022 with the goal of curtailing the abuses and dominance of tech giants and making the digital marketplace fairer.

“It's a very important milestone for freedom and innovation online in Europe,” said Thierry Breton, commissioner for the internal market. “No online platform can behave as if it was too big to care.”

He said the law will give consumers more choices and “open the gates to the internet” by bringing down obstacles faced by smaller tech competitors.

“It was high time that Europe sets the rules of the game upfront, to ensure digital markets are fair and open,” he said in a statement.

The Digital Markets Act is part of a suite of laws and rules the EU is unfurling to protect users' privacy, stop the proliferation of disinformation and harmful content and curb what regulators see as unfair profiteering by tech giants.

Last month, a new EU law, the Digital Services Act, kicked in that compels the world's biggest tech firms to remove harmful content such as disinformation and hate speech, and to stop targeting users with personalized advertising.

But these new laws may face legal challenges by the tech companies. Still, the EU's push to regulate the internet is expected to set global standards and change the way internet giants operate around the world.

The six companies were designated as gatekeepers because they have an annual turnover of at least 7.5 billion euros ($8 billion) in the European market or a market capitalization of at least 75 billion euros ($75 billion), and also because they have more than 45 million monthly users and 10,000 yearly business users across the EU's 27 nation bloc.

The rules will apply to 22 digital platforms run by the six companies, including Facebook, Instagram, TikTok, Chrome, Safari, Amazon Marketplace, YouTube, WhatsApp, Messenger, Google Play, Google Maps and Google Play.

In parallel, EU regulators are examining whether Microsoft's Bing, Edge and Microsoft Advertising platforms and Apple's iMessage service should be regulated under the new rules.

On Wednesday, EU officials said they decided Gmail, Outlook.com and Samsung Internet Browser should not be policed as “core platform services” and therefore will not need to comply with the new rules. Other big platforms not falling under this regulatory regime are X, formerly known as Twitter, Spotify and Booking.com. EU regulators may add more companies to its gatekeepers' list.

Starting next March, those deemed as gatekeepers will have to play by the EU's new rules or face massive fines. The law provides for fines as high as 10% of a company’s total worldwide annual turnover and even up to 20% for repeated infringements.

The rules force gatekeepers to abide by a series of “dos” and “don’ts.”

Among them, platforms are required to allow their users to access third party services. This could mean, for example, a person using WhatsApp might need to be allowed to send messages to platforms outside WhatsApp.

The rules call for allowing businesses to access the data they generate while using a gatekeeper’s platform. Also, businesses using a gatekeepers' platform must be allowed to promote their products and sell goods outside a gatekeeper’s platform.

Starting in March, the six gatekeepers won't be allowed to rank more favorably services and products they offer over those offered by competitors.

Also, the practice of barring consumers from linking up to businesses outside the gatekeepers' platforms will also not be tolerated. Preventing users from un-installing pre-installed software or apps won't be legal either.

The European Commission, the EU's executive arm, will be in charge of enforcing the law. It has said it will hire up to 100 specialists to ensure compliance.

Courthouse News reporter Cain Burdeau is based in the European Union.

Follow @cainburdeau

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