The bill would effectively outlaw an array of behaviors that lawmakers describe as anticompetitive, like Amazon sucking up data from sellers on its platform to copy the products in-house or Google prioritizing its own services over rivals’ in search results.
Klobuchar said in an interview that the bill reflects a growing realization that competition laws, like the Sherman Act of 1890, which prohibits anticompetitive agreements and attempts to monopolize markets, need to be updated for the digital era. (Amazon founder Jeff Bezos owns The Washington Post.)
The American Innovation and Choice Online Act “really gets at the exclusionary conduct so unique to dominant platforms,” she said. “If there had been an Internet when Sen. Sherman was representing Ohio in the Senate, maybe they would have included this.”
The bill comes as recent cases targeting tech giants have tested existing antitrust laws. Advocates for tech regulation say legislation is needed because laws written in the era of railroads and oil barons are not equipped to address the unique ways that Silicon Valley can harm competition and consumers. Both Facebook and Apple have scored courtroom victories in recent months in high-profile antitrust cases.
The bill is widely viewed as a bellwether of whether Republicans and Democrats will be able to convert the mounting bipartisan animosity toward the tech industry into new laws. House lawmakers have already passed a companion version of this bill through the Judiciary Committee, and it awaits a vote on the House floor. The Klobuchar bill highlights the mounting bipartisan interest in both chambers of Congress in overhauling competition law to target the practices of a handful tech giants.
Klobuchar said the White House has also remained “informed” of her office’s work on the bill, as competition policy has emerged as a key focus of the administration. White House press secretary Jen Psaki said last week that President Biden “looks forward” to working with Congress on tech regulation, including antitrust legislation.
The bill’s announcement invited backlash from industry-backed groups arguing that, if passed, it would have a detrimental impact on tech companies. The bill would take a “hammer” to products that consumers love, said Adam Kovacevich, chief executive of the Chamber of Progress, an industry coalition that counts Google, Amazon and Facebook among its partner companies.
“Preventing Amazon from selling Amazon Basics and banning Google’s maps from its search results isn’t going to do anything to make the Internet better for families,” he said. “This is like calling a car mechanic to fix your laptop.”
Advocates for breaking up large tech companies praised the bill and said the recent bipartisan vote backing tech critic Lina Khan to serve on the Federal Trade Commission underscores there’s willingness in both parties to pass antitrust legislation. But they say this should only be the beginning of Congress’s work on these issues.
“The Senate must continue to reassert its power over the handful of men whose corporations undermine economic dynamism, eviscerate the free press, and threaten our democracy itself,” said Sarah Miller, executive director of the American Economic Liberties Project, a nonprofit organization that advocates for aggressive antitrust enforcement.
The Senate Judiciary antitrust subcommittee has hosted several related hearings, during which they’ve questioned witnesses on ways that the tech giants supposedly use their grip on the smart home or app stores to limit competition. Klobuchar noted that these concerns date back to the previous Congress, when a Republican-controlled committee hosted a hearing on self-preferencing, and lawmakers heard testimony from Google critic Yelp.
“Through it all was a common theme about how the dominant platforms were advantaged because they could exclude competitors as only a dominant platform can,” Klobuchar said.
A news release about the forthcoming legislation said it would give enforcers “strong, flexible tools to deter violations,” including steep fines of up to 15 percent of a company’s revenue during the time it was violating the legislation.
The bill also targets much of the conduct that was raised by House lawmakers last year in the findings of their more than year-long investigation into power in the tech industry.