EU to investigate tech giants in digital market overhaul

The EU has announced an extensive investigation in to how technology firms such as Amazon, Facebook and Google use their market powers, as it considers tightening regulations.

The inquiry, which will inevitably focus heavily on US companies, was triggered by France and Germany’s calls for regulation of so-called “essential digital platforms”, which covers everything from e-commerce sites to social media firms.

The “comprehensive analysis” is part of the Digital Single Market Strategy unveiled today in Brussels by European Commission Vice-President Andrus Ansip, which aims to update copyright rules, put an end to cross-border parcel deliveries and ensure European online business can compete with their bigger US counterparts.

“The strategy will give people and companies the online freedoms to profit fully from Europe's huge internal market,” he said. “The initiatives are inter-linked and reinforce each other.”

The aim of the Digital Single Market is to tear down regulatory walls and move from 28 national markets to a single one by pushing businesses to sell across borders. It will seek to clamp down on “geo-blocking”, a practice that prevents users from accessing certain websites based on location or re-routing customers to a corporation's local website, which may have different prices.

“Such blocking means that, for example, car rental customers in one particular member state may end up paying more for an identical car rental in the same destination,” the strategy stated.

However, the inquiry is not aimed at enforcing existing law through penalties and it will look at whether internet platforms are transparent enough in how they display search results and also if they promote their own services over those of competitors.

The EU estimated that a fully functional Digital Single Market could contribute €415bn per year to the economy and create hundreds of thousands of new jobs.

However, the plans are a long way from becoming legislation, as the EC must turn them into concrete legislative proposals that will then be debated and modified by national governments and the European Parliament - a process that could take years.

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