European Union Reins in Big Tech

Lawmakers in the European Union have approved legislation that would heavily regulate Apple, Google, Meta, and other big tech firms that have been called gatekeepers.

The European Parliament formally adopted the Digital Markets Act (DMA) and Digital Services Act (DSA) in what it is calling a Digital Services Package that will prohibit so-called gatekeepers from restricting consumers’ access to third-party voice technologies and other applications and digital services.

Under the new legislation, gatekeepers will have to allow consumers to install and use apps from third-party app stores and the internet, including voice assistants, payment systems, messaging, voice and video calling, near-field communications, authentication mechanisms, and more. The legislation would also require the big tech firms to share their marketing and ad performance data and metrics with developers and competitors. It would also prevent gatekeepers from pre-installing some software; requiring consumers to use default software; requiring developers to use certain services or frameworks, including browsers, payment systems, and identity providers; giving their own proprietary products, apps, or services preferential treatment or ranking them higher than ones provided by third parties; and reusing private data collected in one service for another service.

Violators could face fines of up to 10 percent of their total worldwide annual turnover for the first offense and up to 20 percent and periodic penalties of up to 5 percent of the company’s total worldwide annual turnover for repeated infractions. The EU could impose additional sanctions, such as forcing violators to sell all or some of their assets or blocking acquisitions or mergers.

Andreas Schwab, a representative of the European Parliament’s Internal Market and Consumer Protection Committee, said in a statement that the legislation “ushers in a new era of tech regulation worldwide” and puts an end to “the ever-increasing dominance of big tech companies.

Europe, Schwab added, is “ensuring more competition, more innovation, and more choice for users,” whom he said “will get the choice to use the core services of big tech companies, such as browsers, search engines, or messaging, and all that without losing control over their data.”

If approved by the full European Council in the coming weeks, the Digital Services Package could come into force as early as this fall.