A significant Senate legislation that would block tech companies from granting the preference of their products or services was cleared of a substantial hurdle Congress which brings it just one more step towards becoming law.
The Senate Judiciary Committee has voted today to approve the American Innovation and Choice Online Act and moved the well-known antitrust law to approval by the entire Senate. The bill was supported by a committee vote on Thursday 16-6, which saw five Republicans joined by Senate Democrats to move ahead on the account.
The bill prohibits technology platforms from “favoring their products or services, disadvantaging rivals, or discriminating among businesses that use their platforms in a manner that would materially harm competition on the platform.” It also prohibits the dominant platforms from interfering with other services and from using data from other companies to compete against them.
To achieve its objectives to achieve its goals to accomplish objectives, American Innovation and Choice Online Act will empower the antitrust enforcement agencies by providing them with “strong, flexible tools,” which include “civil penalties, authority to seek broad injunctions, emergency interim relief, and potential forfeiture of executive compensation.”
Senator. Amy Klobuchar (D-MN) is the chair of the Senate Judiciary Subcommittee for competition policy, Antitrust, and Consumer Rights. The legislation was praised as the first significant technology competition law to be brought to the Senate floor “since the dawn of the internet.” The bill is likely to see some tweaks from a few amendments that didn’t hinder its progress on Thursday, but could affect its final language.
Although it’s still some work to do before it can make it into a congested and mostly unfinished legislative agenda, the bill’s progress was enough to spur Google and Apple to join in on it earlier this week.
“Every day, millions of Americans use online services like Google Search, Maps and Gmail to find new information and get things done,” Alphabet Global Affairs President and Chief Legal Officer Kent Walker wrote in a blog article. “…Legislation currently being debated in both the House as well as the Senate could disrupt these and other online services which could make them less efficient and more vulnerable, threatening American competition.”
Apple was also adamant about intervening, writing an open letter directed to Senate Judiciary Chair Dick Durbin, the committee’s top Republican Chuck Grassley, and Antitrust Subcommittee Chair Amy Klobuchar, the subcommittee’s top chairman Mike Lee.
“After a tumultuous year that witnessed multiple controversies regarding social media, whistle-blower allegations of long-ignored risks to children, and ransomware attacks that hobbled critical infrastructure, it would be ironic if Congress responds by making it much harder to protect the privacy and security of Americans’ personal devices,” Apple Senior Director of Government Affairs Tim Powderly wrote. “Unfortunately, that is what these bills would do.”
Both companies claimed that the bill, in conjunction with another measure, the Open App Markets Act, would harm consumer security. The bill in question would require those who manage operating systems to let apps from third parties and app stores and permit developers to let consumers know where they can purchase similar software at lower costs.
A collection of tech companies, including Yelp, DuckDuckGo, Sonos, Spotify, Proton, Match Group and the startup accelerator Y Combinator, and the venture capital firm Initialized Capital spoke out in support of the anti-self-preferencing legislation in the last week.
“Findings from the United States and governments around the world reveal the many anticompetitive self-preferencing tactics dominant technology companies use to attain and entrench their gatekeeper status in the market to the detriment of competition, consumers, and innovation,” the firms submitted. “The American Innovation and Choice Online Act… targets self-preferencing to help restore competition in the digital marketplace and remove barriers for consumers to choose the services they want.”
Regulating the tech sector is a unique issue that has bipartisan support in Congress — another indication of how the technology industry can be prepared for new regulations on its operations even if the proposals aren’t implemented.
This bill was introduced by senators Amy Klobuchar (D-MN) and Chuck Grassley (R-IA) and is co-sponsored by Dick Durbin (D-IL), Lindsey Graham (R-SC), Richard Blumenthal (D-CT), John Kennedy (R-LA), Cory Booker (D-NJ), Cynthia Lummis (R-WY), Mark Warner (D-VA), Mazie Hirono (D-HI), Josh Hawley (R-MO), Sheldon Whitehouse (D-RI) and Steve Daines (R-MT).
The House version of the bill, authored by House Antitrust Subcommittee Chairman David N. Cicilline (D-RI) and the Ranking Member Ken Buck (R-CO), has been voted in committee and is ready to be voted on.