The European Union will clamp down on Big Tech companies such as Facebook and Google thanks to landmark digital rules agreement aimed at regulating online “gatekeepers” that was agreed to late Thursday.
EU officials agreed on the final wording of the Digital Markets Act, a long-awaited overhaul of the region’s digital regulations, that aims to stop the tech giants from unfairly dominating digital markets by threatening to impose large fines on them and even includes the possibility of breaking the companies up.
The act, which continues to require other approvals before becoming law, would force the tech companies to have more stringent restrictions on how people’s information is used for targeted online ads (a key source of revenue for companies such as Facebook and Google) while also requiring different platforms to work together to make users online experience more seamless.
“What we have been deciding about yesterday will start a new era in tech regulation,” European Union lawmaker Andreas Schwab said at a press conference Friday.
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The act would stop the tech giants from self-preferencing their own products and services above those of others in online search results or using data collected from other services to advantage themselves. Users’ personal data will also not be allowed to be combined together for targeted ads unless “explicit consent” is given, the new rules state.
The new digital rules are a key sign of Europe’s attempt to take the lead in restraining the power of the tech giants through stricter regulations on data privacy, antitrust investigations, and new rules pertaining to growing technologies such as artificial intelligence.
Many other countries, including the United States, are expected to follow in the footsteps of the EU in the coming years in regards to beefing up their digital regulations.
The Big Tech companies pushed back against the new act.
Apple said in a statement that it was worried that certain parts of the Digital Markets Act “will create unnecessary privacy and security vulnerabilities for our users while others will prohibit us from charging for intellectual property in which we invest a great deal.”
Google said it would review the act further and work with European regulators to implement it.
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“While we support many of the DMA’s ambitions around consumer choice and interoperability, we remain concerned that some of the rules could reduce innovation and the choice available to Europeans,” Google said in a statement.
