Trade Doublespeak: Could Digital Trade Non-Discrimination Rules Undermine Competition Policy and Other Forms of Digital Governance? ( Rethink Trade)

Arguments

Smaller, profitable tech firms are increasingly concerned about big tech platform monopoly and the potential of domestic policies being preempted by international trade agreements.

Supporting facts:

• Amanda Lewis advises a variety of US-based tech companies expressing increasing concern about this issue.

• Apple, Google, Meta and Amazon’s monopoly power could lead to everyone else losing out.

• Non-discrimination language in trade agreements can undermine efforts to reign in big tech’s monopoly power.

Topics: Tech monopoly, Trade agreements, Tech policy

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Regulations are focused on the dominance and the gatekeeper power that big tech companies have, not their size

Supporting facts:

• Legislation like the DMA in Europe and the digital markets bill in the UK are not focused on companies just because they’re big or American, but based on evidence of monopoly power and abuse of it.

Topics: Digital Market, Monopoly Power, Competition Laws

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There’s a backdoor approach by big tech companies to avoid antitrust regulation and regulatory efforts.

Supporting facts:

• Big tech companies are claiming they’re being discriminated against because they’re U.S. companies, as a way to get around these regulations and laws.

Topics: Antitrust Regulation, Big Tech Companies

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Report

Smaller, profitable tech firms are increasingly concerned about the monopolistic power wielded by major players in the industry, such as Apple, Google, Meta, and Amazon. These giants have the potential to create disadvantages for other companies within the sector, and there is concern that their dominance could override domestic policies due to the influence of international trade agreements.

This negative sentiment is driven by the belief that the monopoly power of these big tech platforms could harm competition and innovation. In contrast, tech firms not affiliated with the major players, such as Google, Amazon, Facebook, and Apple (GAFA), support legislative and regulatory efforts aimed at curbing the monopoly power of big tech.

Match.com, Epic Games, and Spotify are among the companies advocating for a fair and level playing field. Their positive stance towards regulation reflects their desire to eliminate abusive practices stemming from monopoly power. Criticism has been directed at the proposed non-discrimination language for the World Trade Organization (WTO) e-commerce negotiations, as it may favor big tech monopolies over others.

In several jurisdictions, it has been found that Apple and Google possess parallel monopolies in the mobile app ecosystem. To address these concerns, tech companies have written to President Biden and Ambassador Tai, expressing appreciation for their actions in withdrawing the proposed digital non-discrimination language.

Legislative efforts, such as the Digital Markets Act (DMA) in Europe and the digital markets bill in the UK, are not specifically targeting companies based on their size or nationality. Rather, these regulations focus on addressing evidence of monopoly power and its abuse.

The argument is that regulations should be directed towards the dominant position and gatekeeper power of big tech companies, rather than merely their size. There is also apprehension about big tech companies attempting to evade antitrust regulations and other regulatory efforts by alleging discrimination as US companies.

This backdoor approach is seen as an attempt to bypass regulatory measures and avoid necessary scrutiny. Advocating for a level playing field is crucial. It is believed that a fair and competitive environment will foster innovation and enable the best goods and services to thrive.

This stance opposes the notion of incumbent monopoly platforms maintaining their position through market power. In conclusion, smaller, profitable tech firms express concerns about the monopolistic power of big tech platforms and the potential for international trade agreements to undermine domestic policies.

Tech firms outside of GAFA support regulatory efforts to curb big tech’s monopoly power and advocate for fair competition. The proposed non-discrimination language in WTO e-commerce negotiations raises concerns about favoring big tech monopolies. Legislative efforts such as the DMA and digital markets bill aim to address the abuse of monopoly power.

There is also apprehension about big tech using claims of discrimination to evade regulatory efforts. It is argued that a level playing field is necessary to encourage innovation and prevent monopoly platforms from maintaining their position through market power.

Arguments

Australia took the bold step of addressing the bargaining power imbalance between digital platforms and news media businesses

Supporting facts:

• Google and Facebook were considered to be free riding on the media content

• Google made lots of threats and Facebook blocked many pages well beyond news sites for several days

Topics: Australian News Media Bargaining Act, Digital platforms, News media businesses

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The implementation of the Australian News Media Bargaining Act paved the way for other countries like Canada

Supporting facts:

• Canada introduced the Online News Act which is very similar to Australia’s law

Topics: Australian News Media Bargaining Act, Canada’s Online news act

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The rules that govern technology trade were created in 2013 and haven’t been updated

Supporting facts:

• The Trans-Pacific Partnership (TPP) negotiations introduced provisions regarding technology trade in 2013

• The same rules were used in various other free trade agreements

Topics: Digital trade, Trade agreements, Technology

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Katherine Tai, U.S. Trade Representative, is being diligent in approaching digital trade

Supporting facts:

• Tai is a member of the inter-agency committee on competition

• The announcement by the U.S. Trade Representative to withdraw controversial provisions was timed just before the executive order on AI

Topics: Digital trade, Regulations, Monopolies

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Report

The Australian News Media Bargaining Act aims to address the power imbalance between digital platforms, such as Google and Facebook, and news media businesses. It was prompted by concerns that these platforms were benefitting from news content without fair compensation.

The act has received positive sentiment for its bold step in tackling this issue. One of the supporting facts for the need for this act is the accusation that Google and Facebook were “free riding” on media content, meaning they were using it for their own benefit without adequately compensating the news media businesses.

Moreover, Google made threats, and Facebook went as far as blocking pages beyond news sites for several days, causing public outrage. It is important to note that the act is perceived as not discriminatory, as it targets dominant platforms based on their market dominance, rather than their national origin.

This distinction is crucial in addressing concerns raised by technology companies about potential violations of trade agreements. The Australian government maintains that the act does not discriminate against particular companies based on nationality. The implementation of the Australian News Media Bargaining Act has also had a positive effect on other countries.

For example, Canada introduced a similar law called the Online News Act, influenced by Australia’s approach to addressing the power imbalance between digital platforms and news media businesses. However, there has been some negative sentiment surrounding the Australian News Media Bargaining Code.

Tech companies have claimed that the code is discriminatory, a sentiment that Australian authorities refute. It is worth noting that the Australian media bargaining code is compatible with the country’s trade commitments, further undermining the allegations of discrimination. In a broader context, the rules governing technology trade have remained largely unchanged since 2013.

This lack of updates has led to negative sentiment as technology has evolved significantly over the years. The need for updated and nuanced rules regarding digital trade is becoming increasingly evident. The U.S. Trade Representative, Katherine Tai, has been diligent in approaching digital trade and acknowledges the necessity for an update.

To conclude, the Australian News Media Bargaining Act has taken a crucial step in addressing the power imbalance between digital platforms and news media businesses. While facing criticism from tech companies, the act is seen as necessary and not discriminatory.

It has also inspired other countries, like Canada, to implement similar legislation. However, the overall sentiment suggests the need for updated and nuanced rules governing digital trade, considering the rapid pace of technological advancements.

Arguments

Non-discrimination rules for digital products can undermine competition policies and other forms of digital governance as these rules have broad definitions covering platforms, apps, and digital services, thereby affecting how countries regulate.

Supporting facts:

• More than 30 international agreements include non-discrimination rules.

• Digital products are broadly defined in these rules.

• Non-discrimination rules were first seen in the US-Singapore FTA that was signed in 2004.

• The WTO bodies have consolidated a one-sided interpretation of the non-discrimination rule that considers protectionist intent.

Topics: Digital Products, Non-discrimination Rules, Competition Policy, Digital Governance

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If the primary motivation of a regulation is protectionism, it can be considered discriminatory and be subject to criticism

Supporting facts:

• The complaining country has to prove that protectionism is the primary motivation of the regulation or of the policy

Topics: Trade Regulation, Protectionism

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Report

Non-discrimination rules for digital products have raised concerns regarding their implications for competition policies and digital governance. These rules encompass a broad range of definitions that include platforms, apps, and digital services, potentially influencing how countries regulate this rapidly evolving sector.

The introduction of these rules can be traced back to the US-Singapore Free Trade Agreement (FTA) signed in 2004, and they have since been included in over 30 international agreements. A significant point of contention lies in the interpretation of the non-discrimination rule by the World Trade Organization (WTO).

Critics argue that the WTO has adopted a one-sided perspective that focuses on identifying protectionist intent within these rules. This has prompted concerns about the potential for these rules to hinder competition instead of fostering it, undermining the principles of fair market practices and innovation.

One aspect that further complicates the issue is the perceived discriminatory nature of digital competition policies. These policies typically target US-based companies with significant market power and often adopt a size-based approach. The objective behind these policies is to level the playing field in markets dominated by major, influential firms.

However, under the broad non-discrimination rules, these competition policies can be seen as discriminatory themselves. For instance, the News Media Bargaining Code in Australia has garnered criticism for being perceived as discriminatory by the Information Technology and Industry Council. Similar policies in countries like Korea and Canada have also raised concerns in this regard.

The tension between the need to regulate digital markets and the potential clash with non-discrimination rules highlights the complexity of governing digital ecosystems. It is worth noting that the burden of proof lies with the complaining country to establish that protectionism is the primary motivation behind a regulation or policy.

If this cannot be proven, the criticism of the regulation should cease. This criterion aims to differentiate legitimate regulatory measures from protectionist practices and maintain a balance between promoting fair competition and respecting international trade principles. In conclusion, non-discrimination rules for digital products can present challenges for competition policies and digital governance.

The broad definitions encompassing platforms, apps, and digital services raise concerns about potential regulatory implications. Furthermore, the interpretation of these rules by the WTO and the perceived discrimination in digital competition policies add complexity to the issue. Striking a balance between fostering innovation, fair competition, and adhering to international trade principles remains a delicate challenge for policymakers in the rapidly evolving digital landscape.

Arguments

Big pharma and tech platforms are using trade agreements to limit domestic policy space and force governments’ hands

Supporting facts:

• At the formation of the WTO, big pharma was able to extend patent monopolies in a free trade agreement.

• Big tech platforms are taking a page out of the playbook of big pharma, trying to insert into trade agreements rules that could limit domestic policy space.

• They are doing this by commandeer different negotiations, including those in the WTO on e-commerce and establishing a set of binding rules.

Topics: Trade Agreements, Big Pharma, Tech Platforms, Domestic Policy

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US big tech platforms are using non-discrimination rules for digital products to undermine competition policies around the world

Supporting facts:

• Tech companies have proposed very dangerous provisions where big tech platforms and their lobbies have claimed that other countries’ policies violated these rules.

• For example, policies in countries like Korea’s app store bill, the policies in Australia and Canada to make the platforms pay for the news content that they use have been attacked as illegal trade barriers.

• The idea that these non-discrimination rules could be used to undermine antitrust or competition policy started to get attention in part due to industry reports which allowed companies to report what they see as illegal trade barriers around the world.

Topics: Non-Discrimination Rules, Digital Products, Competition Policy

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There is a growing concern over the concentration of power in the hands of big tech companies

Supporting facts:

• Companies like Apple, Google, Amazon, and Meta have parallel monopolies over several digital markets.

• They impose unfair terms and conditions on developers, causing harm such as higher prices for consumers.

• Jurisdictions across the world have concluded this after studying the mobile app ecosystem.

Topics: Competition law, Digital market, Monopoly

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Policies that target companies based on size or dominance are necessary for an effective competition policy.

Supporting facts:

• Most of the legislative initiatives around the world focus on large tech platforms.

• The downsides of the digital marketplace, particularly concentration of power, are being dealt with through these laws.

Topics: Competition Law, Anti-Monopoly, Big Tech

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Governments should regulate the digital market power of big tech companies, not based on their size but due to their dominance and abuse of monopoly power.

Supporting facts:

• Legislation like the DMA in Europe and the digital market bill in the U.K. focuses on big tech companies not because of their size or nationality, but due to their monopoly power.

• There’s evidence that these companies have repeatedly abused their monopoly power causing harm to consumers, workers, and competition in the market.

• Widespread bipartisan support exists for U.S. legislation that targets the same companies.

Topics: Big Tech, Regulations, Digital Market, DMA, Monopoly, U.S. Legislation

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A non-discriminatory trade measure should be based on proving that protectionism is the primary motivation.

Supporting facts:

• the complaining country has to demolish that protectionism is the primary motivation of the regulation or of the policy

Topics: Trade Regulation, Protectionism

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US is finally playing a constructive role in the digital trade debate.

Supporting facts:

• the U.S. is having a very helpful role in the digital trade debate

Topics: Digital Trade, US Role

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Report

Big pharma and tech platforms strategically leverage trade agreements to limit governments’ policy space and manipulate their actions. For instance, when the World Trade Organization (WTO) was formed, big pharma successfully extended patent monopolies through a free trade agreement, tightening their grip on the pharmaceutical industry.

Similarly, big tech platforms mimic big pharma’s tactics by attempting to insert rules into trade agreements that restrict domestic policy options. They influence various negotiations, including those in the WTO on e-commerce, in order to establish binding rules that suit their interests.

US big tech platforms exploit non-discrimination rules for digital products to undermine global competition policies. They argue that policies in countries like Korea, Australia, and Canada, which aim to make platforms pay for news content or regulate app stores, violate these rules and are seen as trade barriers.

There are concerns that interpreting and applying these rules may weaken or circumvent antitrust and competition policies. The concentration of power within big tech companies, such as Apple, Google, Amazon, and Meta, raises significant concerns. These companies dominate multiple digital markets and impose unfair terms and conditions on developers, resulting in higher prices for consumers.

Jurisdictions worldwide have acknowledged this issue and conducted studies to better understand the dynamics of the mobile app ecosystem. While regulations are necessary to address big tech dominance, caution must be exercised when it comes to non-discrimination language in digital trade rules.

There are concerns that this language may unintentionally undermine existing and proposed laws aimed at regulating these companies’ power. It is important to note that regulations aim to restore fair competition in the digital market and are not discriminatory towards any specific country or company.

Legislative initiatives in Europe, the UK, and the US focus on regulating the digital market power of big tech companies based on their dominance and abuse of monopoly power. Concerns have been raised about claims of discrimination by big tech companies based on nationality, which are used to oppose regulation and avoid competition.

It is crucial to emphasize that regulations aim to restore fair competition and are not discriminatory. Regarding trade measures, a non-discriminatory approach should require proof that protectionism is the primary motivation behind regulations or policies. This highlights the importance of clear and transparent language in trade agreements to avoid misinterpretation and ensure the burden of proof lies with the country challenging the regulation.

The US has played a constructive and helpful role in the digital trade debate so far, but further engagement and collaboration are necessary to address the complex issues surrounding digital trade globally. In conclusion, big pharma and tech platforms exploit trade agreements to limit domestic policy options and further their own interests.

The concentration of power in big tech companies raises concerns about fair competition. While regulations are necessary, careful consideration is needed to avoid unintended consequences. Clear language in trade agreements and a focus on non-discrimination based on protectionism contribute to a more equitable and transparent global digital trade landscape.

The US’s involvement is crucial, but continued efforts and collaboration are essential to address the challenges posed by big tech companies accurately.