Senators Criticize The Double Standard Of Sen. Klobuchar’s Anti-Tech Bill
Sen. Amy Klobuchar’s American Innovation and Choice Online Act would prevent only a few American companies from common business practices that other companies like Walmart and Target continue to engage in.
During the bill’s markup last week, several members of the Senate Judiciary Committee warned about the bill’s unfair and illogical treatment of a few companies based on an arbitrary definition of “covered platforms.”
Sen. Dianne Feinstein (D-Calif.) expressed deep concern with the bill for targeting a small number of specific companies. “I am very concerned about the bill this committee is considering. It is not really the type we usually consider where rules are laid out and everyone is expected to comply. Instead, it is specifically designed to target a small number of specific companies.”
— Sen. Feinstein cautioned the bill “will create two separate legal standards.” “Instead of updating antitrust law for our modern online economy as it aims to do, this bill will create two separate legal standards. One that poses very significant barriers to the business operations of a few large tech companies, and one for everyone else.”
Sen, Feinstein further noted that the bill “doesn’t make sense” for only targeting Amazon while exempting other retailers, like Target and Walmart, when they engage in the exact same behavior. “Let me give you an example, let’s say someone goes online to buy stationery. They can go to Walmart or Target website and search for stationery and those websites can show them Target-branded or Walmart-branded stationery first and make them scroll through various pages before they show them stationery from other sellers, but under this legislation if they instead went into Amazon’s website to buy stationery, Amazon could not do the same thing. Amazon could not show them Amazon-branded stationery before it shows them stationery from other sellers – this dramatically different result for engaging in the exact same behavior doesn’t make sense.”
Sen. Mike Lee (R-Utah) questioned the legitimacy of the bill’s designation of covered platforms. “Which companies will be covered by the bill in the future. And why aren’t they covered now?”
— Sen. Lee demanded the removal of the covered platform designation. “I consider it somewhat unthinkable that we would allow two agencies to have authorities to simply declare which companies are covered by the law while making it nearly impossible to appeal that position, and this bill does that.
— Sen. Lee described why the statute would be contradictory: “The designation process is either duplicative on the one hand, or it’s a loophole on the other. Either assessment demands its removal.”
Sen. Alex Padilla (D-Calif.) emphasized the bill should punish bad practices, not just a few companies based on size. “In a competition bill that should be improving competition across industry. Why distinguish between Amazon Marketplace and Walmart Marketplace? If the practices are comparable, a $10 billion-dollar company versus $100 billion company? They both have economic significance. If the concern is that self-preferencing, the activity, the practice is bad when these few companies do it because of their dominance, isn’t it also bad when other large firms beyond these five adopt these same practices?”
Sen. Thom Tillis (R-N.C.) underscored the need to distinguish between anti-competitive behaviors and size alone. “This bill is styled as an innovation and choice bill, yet it would disrupt the leading players in our digital economy at a time when we need all hands on deck. Big can be many times bad, but big is not always bad. Anti-competitive behavior is bad, hyper-competitive behavior in this landscape is good. And we need to make sure that we distinguish the differences.”