UPDATED 16:48 EDT / JANUARY 20 2022

POLICY

Senate Judiciary Committee approves tech-focused antitrust bill

A bipartisan antitrust bill designed to make digital markets more competitive was approved by the Senate Judiciary Committee today in a 16-6 vote.

The bill, the American Innovation and Choice Online Act, is now headed to a vote before the full Senate. The Judiciary Committee’s counterpart in the House has already advanced a similar legislative proposal, CNBC reported.

The American Innovation and Choice Online Act focuses on online platforms such as major app stores, e-commerce marketplaces and search engines. There are situations where the operator of an online platform competes with firms that sell products or services through its platform. On Apple’s App Store, for example, the iPhone maker’s Safari browser app competes with the iOS version of Chrome.

The American Innovation and Choice Online Act seeks to prevent platform operators from implementing business practices that unfairly favor their offerings over those of rivals. A platform operator to which the bill applies would not be allowed to “unfairly preference the covered platform operator’s own products, services or lines of business over those of another business user on the covered platform,” the text of the bill states.

The bill also specifies a number of other requirements that tech giants would have to follow.

The American Innovation and Choice Online Act specifies that a tech company may not make access to its platform contingent on the use of another one of its offerings. For example, developers that distribute apps through the App Store and Play Store are required to use the respective payment systems of Apple and Google LLC to process in-app transactions. The bill would require Apple and Google to end this requirement.

The bill also specifies that tech giants may not “materially restrict or impede” users from uninstalling preinstalled applications. Moreover, companies to which the legislation applies would be prohibited from implementing default settings that “direct or steer covered platform users to products or services offered by the covered platform operator.”

Apple and Google earlier this week penned letters to the Senate Judiciary Committee expressing concerns over the American Innovation and Choice Online Act, as well as a second antitrust bill being considered in the Senate. The second antitrust bill, the Open App Markets Act, focuses specifically on app stores. It would require Apple to let users download iOS apps from sources other than the App Store. 

A number of other tech firms, meanwhile, have publicly expressed support for the American Innovation and Choice Online Act in a separate letter. Prominent startup accelerator Y Combinator was also among the letter’s signatories. 

Image: Unsplash

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