Bundestag passes new digitization law – Google, Facebook and Co. are restricted

The Bundestag has passed a new GWB digitization law. The federal government’s draft law, entitled as “Draft of a law to amend the law against restraints of competition for a focused, proactive and digital competition law 4.0 and other competition law provisions”, was accepted. The Federal Cabinet passed the present draft law on September 9, 2020. The aim of the law should be loud Website of the German Bundestag his “to better counteract abusive behavior by companies with overriding, cross-market importance for competition”.

The cornerstones of the law: Stricter competition law

On the website of the Federal Ministry for Economic Affairs and Energy the draft law is presented. There are also three cornerstones for the amendment to the digitization law. On the one hand, abuse control is to be tightened.

The aim is to make the rules of the game for dominant platforms stricter and at the same time to increase the opportunities for innovation as well as market and data access for competitors,

it says on the website. This applies in particular to platforms such as Facebook, Google or Amazon. In future, you should no longer be allowed to prefer your own products when displaying your own and third-party offers. On the other hand, thanks to the law, users should be able to migrate their data from platforms to other providers more easily. And the Federal Cartel Office should be able to intervene more quickly in order to avoid long-term proceedings – as in the case of the EU Commission proceedings against Google and the Google Shopping offer. In order to protect competition at an early stage, the Federal Cartel Office should be able to take “interim measures” more quickly in future.

Ultimately, SMEs and competition in the digital space should be protected overall through better merger control. According to this, “acquisitions by large companies even below the intended threshold values” should now be able to be examined more closely. Legal certainty in the joint use of data is also to be strengthened. Opposite the Tagesschau were SPD politicians Falko Mohrs positive that this law could actually make competition fairer:

We are taking a pioneering role here. We are the first country in the world to act so proactively against these major platforms.

The antitrust attorney Dr. Axel Kallmayer OnlineMarketing.de explains that the law will not only affect big tech companies:

The legislature has decided to control the market power of large digital groups more closely and a modernized antitrust law should serve as an instrument. Both are fundamentally sensible, since competition should be protected not only in the old economy, but also in the increasingly important digital economy. The regulations will not only apply to big tech like Google and Amazon, but also to smaller companies and the real economy. There are also important platforms and data treasures there. It will be exciting to see what duties and opportunities the new rules will create here.

The Federal Cartel Office sees more opportunities to enforce fair competition

President of the Federal Cartel Office Andreas Mundt already welcomed the law in Annual review by the Federal Cartel Office:

Hopefully we will soon see very important additions to German antitrust law in order to be able to effectively prevent the abuse of market power by large digital platforms. The legislative process for the amendment to the GWB is well advanced and we are preparing for the application of this new instrument from next year.

Opposite RBB Inforadio he now stated that a few companies could not be allowed to determine “what happens on the Internet and beyond”. He explains:

These companies are no longer allowed to favor themselves or their own services. They must no longer hinder other services that want to enter markets, be it through the use of data or through other strategies. And they cannot simply force consumers to only use the services of this company if they give their data. There must be alternatives.

Accordingly, Andreas Mundt sees the efforts for a new digitization law in Germany as positive. The Bundeskartellamt has completely new opportunities. This is how Mund thinks:

We can intervene in markets where this very large company is not yet dominant. So we don’t have to wait until the child has fallen into the well, we can pull out our weapons in good time. I do believe that there will be more equality of arms here in the medium term.

The complete draft law for the amended GWB digitization law you can understand here. After it was passed in the Bundestag, antitrust law in Germany’s digital space is now being tightened significantly. How much this will ultimately limit the tech giants such as Google, Amazon or Facebook will only be observed in the future.

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