Tech giants will need to inform EU of takeover plans

Tech giants will need to inform EU of takeover plans

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Paris: Tech giants will need to inform the European Union ahead of any planned mergers or acquisitions under tough new regulations set to be unveiled this week, the bloc’s industry commissioner Thierry Breton said Monday.

The European Union is scheduled to propose a new “Digital Services Act” and its accompanying “Digital Market Act” on Tuesday, laying down strict conditions for Internet giants to conduct business in 27 countries.

The biggest tech firms will be designated internet “gatekeepers”, subject to specific regulations to limit their power over the market.

“We’re going to require big platforms to notify us before they make an acquisition” as part of the new regulations, Breton told France Inter radio.

It is almost certain that Google, Facebook, Apple and Amazon, and perhaps other companies, will be defeated by this name.

European and American regulators are increasingly concerned that large technology companies have used purchases to suppress potential competitors.

Examples include Facebook’s acquisition of Instagram and Whatsapp, and Google’s acquisition of YouTube and Waze.

Breton said that the prior notice requirement will be the world’s first and will directly target those large customer bases whose customer base and market value “give them predatory power.”

The EU believes that just as large banks were considered “too big to fail” and were subject to special supervision by financial regulators after the 2008 financial crisis, so too should large technology companies.

“Because when one is very big there are greater responsibilities,” Breton said.

He added, “My role is to set rules, and if they are not adhered to there will be sanctions.”

But Breton also warned that if these sanctions are repeatedly not respected “they could ultimately result in a breakup”.

These proposals will go through a long and complicated approval process. The 27 member states of the European Union, the European Parliament, and corporate lobbyists and industry associations will influence the final law.

France and the Netherlands have already begun to support Europe and have all the tools needed to control the euro zone’s goalkeepers, including the power to break them down.

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