EU Announces Sweeping New Rules On Big Tech

EU announces sweeping new rules that could force breakups and hefty fines for Big Tech

Silvia Amaro

 Tech giants could soon face hefty fines and stricter controls over their behavior as part of sweeping new rules in the European Union.

The European Commission, the executive arm of the EU, on Tuesday presented two new pieces of legislation that will affect how Big Tech operates. The region has long had concerns about how powerful some companies have become, and how this is a problem for smaller firms looking to compete in the European market.

In this context, the new Digital Markets Act aims to tackle behavior that closes these markets off.

One of the potential changes is putting an end to self-preferencing — when, for instance, app search results in an Apple product display options developed by the tech giant. The idea is to give smaller app developers the same chance of being found and chosen by consumers.

Other practical changes include: companies like Apple and Google will have to allow users to uninstall apps that have originally come with their devices, and performance metrics will also have to be shared for free with advertisers and publishers.

Failure to comply could result in fines as high as 10% of the companies’ worldwide annual turnover. 

One senior EU official, who didn’t want to be named due to the sensitivity of the issue, told CNBC the EU’s aim is to enforce remedies that will lead to practical changes rather than fining those breaching the rules constantly.

The remedies could ultimately include forcing companies to divest if they breach the rules systematically. The same official said that selling parts of the business would only happen “if no other remedy is available.”