Tech Legal Outlook 2022 – Trends in antitrust regulation and enforcement

Antitrust enforcement and regulation in tech continues to dominate headlines with high-profile investigations and fines against major tech platforms as well as proposed new regulations that will shape the digital economy in 2022 and beyond.

Landmark ruling against Google

On 8 November, the EU’s General Court upheld the European Commission’s blockbuster €2.4 billion fine on Google for using its search engine pages to discriminate in favour of its comparison-shopping service.

In addition to chalking up a significant win for Executive Vice President Vestager’s agenda, the judgment has implications well beyond Google’s conduct: by endorsing restrictions on the way in which the largest digital platforms can favour their own related services, the Court has given support to a key plank in the emerging framework for regulating digital platforms around the world.

But beyond the implications of a single case, the last twelve months has also seen regulators and legislators globally increasing enforcement and developing new regulatory proposals focused on antitrust concerns in digital industries.

High profile investigations and enforcement across the globe 

The European Commission has continued its intense scrutiny of digital platforms with new formal investigations into Facebook and Google, adding to those already open against Amazon and Apple. The UK CMA also launched high-profile market studies into Apple’s and Google’s mobile app eco-systems and the music streaming industry.

These have, however, arguably taken second billing to high-profile investigations in China and the US.

In the US, state and federal enforcers have continued their high-profile enforcement cases against Facebook, Google, Amazon and other platforms. In China, the State Administration for Market Regulation announced USD2.8 billion and USD 533 million fines for Alibaba and food delivery giant Meituan respectively for anti-competitive exclusivity obligations on their merchants.

Regulatory proposals progressing across the globe

On the regulatory front, the EU’s Digital Markets Act (DMA), which would impose significant constraints on business models of the largest digital platforms, has advanced down the legislative track largely unscathed despite intense review by the EU’s Member States and the European Parliament.

The UK and the US have also started to develop their own regulatory proposals for digital platforms.

The UK Government consulted on new regulatory powers for its digital markets unit over the Summer. While bearing some similarities to the DMA, the consultation proposals also included a far more intrusive merger control regime for large digital platforms. In the US, proposed legislation has emerged in the US Congress incorporating elements of the trends in Europe: some proposals would facilitate enforcement by reducing burdens of proof, while others would address specific areas of platform regulation such as self-preferencing.

In China, the National People’s Congress is reviewing a proposal to amend the Anti-Monopoly Law, which would tighten competition enforcement against anti-competitive conducts by digital platforms.

Proposals from the last year could become law in 2022

Much of the behind-the-scenes work over last 12 months is also likely to come to the fore in the next six to twelve months.  

The European Council and European Parliament are expected to hammer out a compromise for the DMA in the first half of 2022, paving the way for adoption later in 2022 or early 2023. In tandem, the Commission’s investigations into Amazon and Apple are in their latter stages and may force changes to both firms’ business models over the next 12 months.

While less certain, the UK Government has stated that it ‘aims’ to give the DMU its new regulatory powers as soon as parliamentary time allows. The CMA is also currently reviewing proposed commitments from Google concerning digital advertising as well as progressing a number of probes and ongoing market studies in the tech sector.

The next year will also be a litmus test for the Biden administration. After promising more active enforcement, the new leadership of the antitrust agencies will feel pressure to file new enforcement actions. In the meantime, Congress – particularly through the Senate – is likely to continue to develop legislation to help support the effectiveness of that enforcement in court.

In China, the trend of intensifying antitrust regulation is likely to continue. China has unveiled a new settlement for its trustbuster, the State Anti-Monopoly Administration, with a significantly higher ranking and more resources later this year. The Authority is also likely to get increased fining powers in the coming months. We expect these developments to only prompt further enforcement.

For more on tech trends see our Tech Legal Outlook 2022