Last month, Italy’s competition watchdog fined Amazon 1.13 billion euros ($1.28 billion), the latest of several sanctions against Big Tech firms in 2021.
When Italy’s competition regulator fined Amazon 1.13 billion euros ($1.28 billion) last month, it was just the latest salvo in a string of moves against Big Tech.
The watchdog, Autorita Garante della Concorrenza e del Mercato, has increased its actions in the last year, issuing a flurry of rulings against Amazon, Alphabet’s Google, and Facebook owner Meta, to name a few. In the case of Amazon’s most recent fine, the regulator objected to the company encouraging Italian sellers to use its own logistics service, Fulfillment by Amazon, which the watchdog deemed an abuse of its dominant position. Amazon denies the accusation.
AGCM has been extremely active. Throughout 2021, it imposed a number of fines on major US technology companies. In another case, it fined Amazon and Apple for alleged anti-competitive collusion. It fined Google 102 million euros for “abuse of dominant position” in its car software product, and fined Facebook 7 million euros in February for data use.
The severity of the sanctions varies greatly, but they all convey the same message: National regulators will take action in their respective markets.
However, regulators such as AGCM will not go unchallenged in their decisions. Amazon has responded to the order and plans to appeal the $1.28 billion fine.
According to Maria Luisa Stasi, a senior legal officer at Article 19, a digital rights nongovernmental organization, it’s not surprising that some national watchdogs, such as those in Italy, France, and Germany, have taken the initiative to speak out against Big Tech.
“Certain competition authorities in Europe are far more inclined to go for sector inquiries or market studies where they believe there may be some problems rather than waiting for complaints to come in,” she explained. It’s not a coincidence, she says, that these investigations are taking place in markets with larger populations and more developed digital audiences and consumers.
However, she stated that there will be budget, resource, and capacity issues, with regulators of all shapes and sizes confronted with increasingly large digital workloads.
Sifting through evidence and data, especially in the case of Big Tech’s vast and global businesses, requires a lot of elbow grease, which can put a strain on budgets and know-how.
She is in favor of regulators taking interim measures against companies, such as ordering the suspension or restriction of a specific activity during an investigation, rather than waiting for the investigation to conclude, which could take years. Other competition watchdogs have set up specialist units to address Big Tech. The United Kingdom’s Competition and Markets Authority, which has recently accelerated its own actions against large digital players, established a dedicated tech unit last year to investigate digital behemoths. Most notably, the CMA is at odds with Facebook over its acquisition of Giphy.
While organizations such as the AGCM have acted on their own, the dynamic of competition regulation in Europe, particularly in relation to Big Tech, is about to change dramatically.
The Digital Markets Act is a comprehensive set of new EU regulations that is still in the works but is nearing completion. It will be a top priority for the EU Council, where government ministers meet to pass legislation and is currently led by France. To prevent abuses, the DMA will tighten rules for large tech companies — so-called gatekeepers — that have market dominance. It will also increase scrutiny of mergers and acquisitions transactions.
The European Commission, the EU’s executive arm, will investigate any abuses or misdeeds committed by these gatekeepers.
According to Luisa Stasi, the DMA is also concerned about capacity and resources.
Meanwhile, other national regulators continue to take action, whether in competition law or other areas such as privacy and data protection.