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5th Dec 2021

Big tech's EU lobby spending revealed, as key acts loom

  • Facebooks European HQ in Dublin. The Digital Markets Act and the Digital Services Act are under intense lobbying
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The digital industry now has more lobbying power than pharmaceutical, fossil fuels, financial, or chemical sectors, spending annually over €97m to influence EU decision-making, a new report found on Tuesday (31 August).

The research by NGOs Corporate Europe Observatory and LobbyControl revealed an unbalanced playing field, where just a few firms dominate lobbying efforts in EU digital economy policies.

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Only 10 companies are responsible for almost a third of the total tech lobby expenditure - with Google, Facebook, and Microsoft as top spenders, with a budget of over €5m each.

However, a total of 612 companies, groups, and business associations in the digital sector were identified as lobbying actors in Brussels - with most of the big players coming from the US.

The report notes that tech companies are not just lobbying policy-makers individually, since they also tend to be part of businesses and trade associations and a wider network of "non-transparent collaborations" with think tanks, consultancies, and academia, all of which are also trying to influence the public debate.

Currently, the Digital Markets Act (DMA) and the Digital Services Act (DSA) are under intense lobbying, as the two landmark pieces of legation with the potential to shape online platforms' business models.

The DSA is aimed at making digital companies accountable for the illegal and harmful content displayed on their platforms, while the DMA attempt to establish for the first time a list of 'dos' and 'don'ts' for the biggest online platforms, so-called gatekeepers.

However, the report also points out how lobbyists behind digital industries keep advocating for a regulation based on a case-by-case approach, using narratives such as "regulation stifles innovation" or arguing that too much regulation will cause Europe to fall behind the US and China.

For example, Facebook's global head of corporate communications Nick Clegg (a former UK deputy prime minister) said in a text published last May that the "Chinese model presents a risk to the open internet as we know it", warning that "policymakers need to avoid two unintended consequences: unnecessarily stifling European innovation, and inadvertently accelerating the splintering of the global internet".

Under the von der Leyen Commission, EU high-level officials such as commissioners, directorates-general or head of cabinets held 270 meetings on these two proposals since November 2019.

The majority of these meetings were with industry lobbyists (75 percent), compared to NGOs (19 percent) and other groups (six percent).

But the lobbying battle has now moved to the European Parliament and Council, where discussions to find a common position are still ongoing.

'Independent voices' required

Meanwhile, civil society and academia are calling on EU institutions to address not only the massive economic power concentration of big tech but also their capacity to influence EU decision-making.

"The economic and political power of the digital giants is hefty, and they are not going to remain passive in the face of possible new rules that affect the way they conduct their businesses. That's why the EU institutions urgently need to change the way they handle this lobbying," said Tommaso Valleti, former chief economist of the EU Commission competition department and professor of economics at Imperial College London.

Similarly, Margarida Silva, a researcher at Corporate Europe Observatory, said that "it is crucial that independent voices and citizens get involved in these policy discussions, to ensure that corporate lobbyists do not get to shape the future of technology".

For his part, Max Bank, author of the report and researcher from LobbyControl, called especially on EU capitals to "stop acting opaquely, and finally ensure that they provide democratic accountability regarding their processes and decisions".

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Online giants could face 10% fines under new EU law

The European Commission unveiled on Tuesday a package of proposals that set out legal obligations for digital platforms aimed at tackling illegal content and unfair practices in today's digital environment.

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