DOJ Gives Support for US Antitrust Legislation for Digital Companies

WASHINGTON — The Department of Justice is throwing its support behind a law that could change how American online shoppers are shown products.

The bill, called the American Innovation and Choice Online Act, would make it illegal for an online marketplace, such as Amazon, to put its products at the top of a search result purely because the company owns the website. 

The legislation also puts restrictions on how companies can use the non-public data collected from its users, and would allow people to uninstall applications from their devices.

This letter from the department comes days after the European Parliament unveiled its framework for anti-trust laws targeting these large online corporations — the Digital Markets Act.

The European Union not only wants to regulate how companies place products online and how companies can use customers’ data but also how the largest platforms must allow smaller third-party applications to have “interoperability.”

Both American and European lawmakers hope these new laws in conjunction with existing antitrust laws create an easier path for cracking down on companies with a large online presence.

In the department’s letter, Acting Assistant Attorney General Peter S. Hyun said the department sees these large online corporations as “a threat to open markets and competition, with risks for consumers, businesses, innovation, resiliency, global competitiveness, and our democracy. By controlling key arteries of the nation’s commerce and communications, such platforms can exercise outsized market power in our modern economy.”

The growing power of these companies “contravenes the foundations of our capitalist system,” Hyun wrote.

The proposed law would grant important clarity and supplement antitrust laws already in place for the digital age, Hyun added.

According to the law, the Federal Trade Commission would create a Bureau of Digital Markets that would enforce the antitrust laws aimed at the largest online corporations through lawsuits and fines levied for violating the law.

Just after the department released its letter, two European Parliament members, Andreas Schwab and Christel Schaldemose, and Reps. David Cicilline, D-R.I., and Ken Buck, R-Colo., who co-sponsored the bill, signed a joint statement about working together on creating similar tech policy in their respective areas.

“We will work together in support of a democratic framework for the digital transformation contributing to fair, dynamic, and prosperous societies and economies from both sides of the Atlantic,” they wrote in the statement dated March 30.

Both the House and Senate have bipartisan support for this legislation introduced last June and October, respectively for each chamber.

Despite not releasing the exact text last week with the announcement of new rules for the DMA, the law could be put into effect as soon as October in the European Union, said Margrethe Vestager, the EU’s commissioner for Competition at a recent press conference.

It’s unclear what Congress’ timeline is, despite having bipartisan support with Republicans as nine of the 33 House sponsors and six of the 12 Senate sponsors.

This letter will hopefully push it forward, Buck said in a statement. 

“The Department of Justice’s letter of support is a huge step forward for this legislation, and represents the pieces falling into place for wide-ranging reforms to America’s competition landscape to pass into law. Now it’s time for the full House to act on this bill to protect small businesses and ensure that the free market is working for everyone, not just Big Tech monopolies,” Buck said in a statement. 

Cicilline, who introduced the bill, concurred.

“I am proud to see the Justice Department recognize that the American Innovation and Choice Online Act will help secure America’s global competitiveness, create economic prosperity, and unlock innovation and entrepreneurship,” Cicilline wrote in a statement.

“As the department notes, this bipartisan legislation will provide much-needed clarity to the law while enhancing the ability of enforcers to efficiently and effectively promote competition online. I look forward to working with my colleagues to get this bill to the president’s desk. The American people are demanding action, and we’re going to deliver.”

Madeline Hughes can be reached at [email protected]