France, Germany want EU to take a tougher stance on tech firms

Pressure is mounting in the European Union for tougher competition rules for U.S. tech firms

Germany and France have put pressure on the European Commission to take a closer look at how big tech companies operate in the European Union, a move which could lead to tougher competition regulation for companies such as Google, Apple, Amazon.com and Facebook.

French and German officials asked the Commission on Thursday to start a discussion about the development of EU competition law to deal with challenges that arise with Internet platforms, companies that don't just run their own businesses but also wield power over the publishers, information providers and app developers that depend on them, said Beate Braams, a spokeswoman for the German Federal Ministry for Economic Affairs and Energy.

The push for more scrutiny from two of the biggest EU economies could spell more trouble for U.S. tech firms which have been under fire from national and EU authorities in on a range of competition issues.

The Commission for instance has been examining Google's promotion of its own services in search results since 2010, an issue for which no end is in sight.

It is also conducting investigations into the tax affairs of Amazon and Apple to determine whether the companies received illegal sate aid.

In Germany and France, Google has been embroiled with publishers that say the company is abusing its market power to force news outlets to allow it to republish text snippets of news articles without compensation.

France and Germany did not make a concrete proposal for changes in EU competition laws, Braams said.

The EU treaties mean that any legislative changes would need to be at the EU, not national, level, she said.

The Franco-German call came on the heels of a call from the European Parliament to antitrust regulators to consider unbundling search engines from other commercial services as a way of maintaining competition in the search market, a move that is largely seen as another slap in the face of Google.

It also follows a letter sent to the Commission by four German ministers earlier this month which covered digital matters and also highlighted competition issues.

Open markets and fair competition should be basic requirements for innovation in the digital economy, the ministers wrote. And dynamics in the digital domain should be no excuse to allow an increase to the risk of abuse by big digital firms, nor should these platforms be allowed to favor their own products, they said.

Competition policy should make sure that such dominant market powers remain vulnerable. When such market powers are no longer vulnerable behavioral regulation would be an obvious next step to take, the Ministers said.

Loek is Amsterdam Correspondent and covers online privacy, intellectual property, online payment issues as well as EU technology policy and regulation for the IDG News Service. Follow him on Twitter at @loekessers or email tips and comments to loek_essers@idg.com

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