From Google facing the threat of a split, to Apple being fined a record by the European Union, to the intense scrutiny of new forms of competition in the field of artificial intelligence, in 2024, tech giants are facing the most severe antitrust challenges in their history.
Yin Ranran, partner of Ruimin Law Firm's anti-monopoly business, stated in an interview with First Financial News that in 2024, global anti-monopoly regulatory agencies are adjusting their enforcement strategies to address some non-traditional competitive behaviors in the technology industry. At the same time, anti-monopoly regulatory agencies have also begun to closely follow the rapid development of the artificial intelligence industry. For example, European regulatory agencies have broken through the traditional perspective of market share and pricing power when assessing potential competitive damage in the field of artificial intelligence, and have begun to focus on a broader dimension of competition.
Tech giants face unprecedented regulatory challenges
In 2024, major global tech giants faced enormous regulatory pressure, ranging from penalty amounts to regulatory scope.
Google has encountered multiple milestone regulatory setbacks. In August, the US Department of Justice won the search engine monopoly case and subsequently requested a federal judge to consider splitting the company. In Europe, France fined Google 250 million euros in March for violating its media content usage commitments. The Asian market is also full of challenges: the South Korean High Court supports the ruling of antitrust regulators, imposing a fine of approximately $168.6 million on Google for restricting competition on the Android system; Indonesia is investigating Google's alleged abuse of market dominance in the Play Store payment system.
Apple also faces multiple challenges. In March, Apple was fined a record breaking 1.8 billion euros by the European Union for abusing its dominant position in the streaming app distribution market. At the same time, the European Court of Justice ruled that Apple needs to pay 13 billion euros in Irish taxes. In addition, India has determined that Apple has abused its market dominance in the iOS App Store, and the European Union has launched an investigation into its NFC mobile payment system restrictions.
Meta's compliance pressure mainly focuses on data protection and mergers and acquisitions. At the beginning of the year, the company reached a settlement with Israel for an unapproved merger and paid a fine of 6 million euros. In Türkiye, Meta was cumulatively fined 16 million euros for failing to prove the performance of data separation obligations.
Amazon has encountered significant setbacks in the areas of mergers and acquisitions and platform governance. The company's plan to acquire iRobot for $1.4 billion has been terminated due to its refusal to agree to the relief measures proposed by the European Commission, and Italian regulators have imposed a fine of 10 million euros for its unfair trading practices. Indian regulatory authorities have also determined that Amazon engages in anti competitive behavior such as favoring affiliated sellers in platform operations.
The regulatory scope is still expanding. The Consumer Financial Protection Bureau (CFPB) in the United States recently announced that it has included the electronic payment services of Google and Apple in its regulatory scope for the first time, pioneering the regulation of technology payments.
Looking ahead, Yin Ranran predicts that the global regulatory situation will further strengthen. The new US government is likely to continue and strengthen existing enforcement trends, including attention to the labor market, strict scrutiny of the technology industry, and higher requirements for merger relief measures. She also stated that according to the statement of the new EU Competition Commissioner Teresa Ribera, the European Commission will continue to maintain a strict regulatory posture towards technology giants.
Evolutionary Theory of Digital Market Regulatory Tools
With the development of technology, economies around the world have begun to promote the transformation of digital market regulatory paradigms, gradually moving from individual case supervision to the construction of systematic regulatory frameworks, and this trend will be further deepened in 2024.
Yin Ranran believes that in 2024, anti-monopoly regulatory agencies will begin to closely follow the rapid development of the artificial intelligence industry. Regulatory agencies are not only exploring how to understand and respond to the "artificial intelligence market", but also gradually establishing an analytical framework for artificial intelligence regulation through extensive market research, concentration of operators review, and pre regulatory tools.
Yin Ranran explained that in the upstream of the artificial intelligence industry chain, regulatory focus has shifted to the issue of accessibility of key resources, with particular attention to whether difficulties in obtaining computing power and data resources will pose barriers to entry for small and medium-sized independent AI developers. In the downstream market, regulatory agencies closely monitor how large technology companies can leverage their advantageous positions in digital products, services, and data to expand their influence in emerging AI technologies.
This trend continues to emerge globally. At the beginning of the year, Hungary launched a competition assessment of the artificial intelligence market, while South Korea began revising the Monopoly Control and Fair Trade Act to strengthen online platform regulation. In March, India released a draft of its Digital Competition Law, which draws on the experience of the European Union to introduce the concept of "systemically important digital enterprises" and establish a specialized regulatory framework for the digital market. In May, the UK passed the Digital Markets, Competition and Consumer Act, introducing new review standards, imposing specific behavioral requirements on digital companies with "strategic market positions", and upgrading the antitrust enforcement system.
As a pioneer in digital market regulation, the EU continues to promote the implementation of the Digital Markets Act. In May 2024, the European Union will include the online booking platform Booking.com in its "gatekeeper" list and continue to evaluate the compliance plans of other "gatekeeper" companies, including Apple. Japan passed the "Promotion of Specific Smartphone Software Competition Act" in June, specifically regulating the mobile application market. Australia also announced in October that it will implement a mandatory merger and acquisition control system in January 2026, with a focus on supermarkets, continuous acquisitions, and complex transaction areas.
US regulatory agencies have also increased their focus on the artificial intelligence market. The Federal Trade Commission and the Department of Justice in the United States have successively launched reviews of mergers and investments by tech giants such as Microsoft, Google, and Amazon in the AI field, with a particular focus on potential "killer acquisitions" and technology monopoly risks. The FTC is also working on developing a review report on AI related investments, with plans to enhance market transparency by publicly disclosing trading details.
At the same time, cross-border regulatory cooperation is constantly deepening. On October 28th, the EU and the UK completed technical negotiations for an antitrust cooperation agreement, laying a solid foundation for the dialogue mechanism between the European Commission, member state antitrust agencies, and the UK Competition and Markets Authority (CMA).
New anti-monopoly challenges in the field of AI
With the rapid development of artificial intelligence technology, the field of anti-monopoly law enforcement is facing many challenges brought by new competitive behaviors. The traditional regulatory framework for mergers and acquisitions mainly focuses on direct acquisition behavior, but technology giants have begun to shift towards a more covert "quasi merger" model. This model is achieved through strategic cooperation, equity investment, and acquisition based recruitment and recruitment; quot; Through methods such as acqui hiring, substantial control over the products, technology, or core talents of the target enterprise can be achieved, thereby cleverly avoiding the constraints of existing anti-monopoly regulations.
This trend has been frequently observed in the past two years. For example, Microsoft has successfully introduced multiple executives and core R&D personnel from the AI unicorn company Reflection AI. Meanwhile, Microsoft has invested over $13 billion in OpenAI and established Azure as OpenAI's exclusive cloud computing service provider in the agreement. Similarly, Amazon injected $4 billion into Anthropic in March 2024, requiring the latter to use AWS as its primary cloud service platform.
Since the beginning of this year, regulatory agencies have taken action to address this trend. In April 2024, the UK CMA released a statement announcing an evaluation of the transactions between Microsoft and Reflection AI, as well as Amazon and Anthropic. Although these two investigations were ultimately allowed to proceed, CMA has made it clear that "the transfer of assets or employees may constitute a substantive merger" and reserves the right to review similar transactions in the future.
Yin Ranran told First Financial reporters that regulatory agencies are adjusting their enforcement strategies to address some non-traditional competitive behaviors in the technology industry. For example, under its broad and flexible operator concentration review system, CMA has reviewed new concentration methods in the field of artificial intelligence.
The latest decision by CMA in the Microsoft/Inflection case indicates that if talent is crucial to a company's technology and core business activities, CMA will have jurisdiction over talent acquisitions in the technology industry Yin Ranran said.
It is worth noting that the deep partnership between Microsoft and OpenAI has also attracted high attention from global regulatory agencies. CMA、 The EU antitrust supervisory agency and the US Federal Trade Commission (FTC) have both launched investigations into this partnership, focusing on whether it constitutes a de facto "merger" and whether it violates antitrust regulations.
Yin Ranran analyzed, "In addition to talent acquisition, other forms of cooperation or agreements between large technology companies and artificial intelligence startups (such as cloud partnerships, intellectual property licensing arrangements, etc.) have also attracted the attention of regulatory agencies in the European Union, the United Kingdom, and the United States. As these trends continue to develop, it is expected that law enforcement agencies may introduce more detailed policies or rules in the future, and regulatory trends in this field deserve close attention