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Abu Dhabi, UAEMonday 10 December 2018

Big tech companies threaten our democracy, warns EU Commissioner Margrethe Vestager

In a fierce attack on the likes of Google, Apple and Facebook, the European Commissioner for Competition outlined the dangers of their unchecked ambition

Margrethe Vestager told an audience in Lisbon that big tech companies are allowing “fear” and “greed” to drive out competition. Seb Daly/Web Summit
Margrethe Vestager told an audience in Lisbon that big tech companies are allowing “fear” and “greed” to drive out competition. Seb Daly/Web Summit

Our democracy is under threat from technology companies, the European Commissioner for Competition has warned.

Margrethe Vestager, who handed out a €2.4bn fine to Google in June for manipulating search results, has said that giant tech companies are allowing “fear” and “greed” to drive out competition.

Brussels’ has a sizeable challenge in dealing with these big companies and those who are aided by domestic and foreign governments, something that has come more into the light as the extent of Russian interference in the US election through social media has emerged.

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“The motives that are breaching competition law are as old as Adam and Eve,” Ms Vestager said during Web Summit, one of the biggest tech events of the year. She added: “It’s about greed. Fear. And when you combine that with power you get a very poisonous cocktail”.

“The motives go way back but our challenge is to stay fast enough and to have the right tools because this is a fast moving area in our economy now,” she continues. Ms Vestager added that if this is not done, smaller companies will struggle to gain audiences in the shadow of these tech giants.

In a highly critical talk of the technology company, in which Google, Apple and Facebook were highlighted for abusing their dominant market share, Ms Vestager told an audience of founders and CEOs of the world’s largest tech companies as well as political leaders that action was needed.

“We have to take our democracy back. We cannot leave it neither to Facebook, or Snapchat, or anyone else. We have to take democracy back and renew it because society is about people, not technology.”

Ms Vestager’s strong comments reflect the change in attitude in Brussels, which has been cracking down on corporate tax avoidance and competition rules.

As well as hitting Google with a record €2.4 billion for demoting rivals and unfairly promoted its own services in its search results, last month Amazon was ordered to pay €250m in back taxes in Luxembourg - a decision Amazon is likely to appeal and both the company and country deny any wrongdoing.

The Commission has also moved to take Apple to the European Court of Justice to attempt to force Ireland to collect €13bn in taxes owed by Apple.

Quipping that “people like me never get unemployed”, Ms Vestager said “there must be change” following the revelations of the latest tax avoidance leaks, the Paradise papers.

She noted that pressure from citizens has helped pave the way for legislation to address this problem and called for public country-by-country reports where companies must outline basic elements of their business in that region, such as if they have staff, make a profit or pay tax in each country.

Often accused of being anti-American, the Danish European Commissioner said that Europe recognised the limitations of free markets in a different way to the US.

“We want free markets but we understand the paradox of free markets which is that sometimes we have to intervene. We have to believe that it’s not the law of the jungle but the law of democracy that works.”