European nations are increasingly worried about the new startups sprouting around the continent. Big tech companies are investing in new startups and becoming their launching pads on the soils of Europe; in a way escaping from the tight scrutiny and rules to increase their return turnovers.
The European Union EU is one of the leading regulators in the technology market but now more countries have raised concerns about tech companies gaining power in their region while installing newer plants under the name of new startups.
Germany, the Netherlands, and France have openly voiced their concerns in a recent discussion of the 27-member bloc. They proposed a new Digital Markets Act to let the EU market gain back control of these tech companies. The digital markets act will impose new stricter policies to maintain scrutiny in Europe.
Berlin, The Hague, and Paris are all about stricter measures on mergers. They released a joint statement which said that to strengthen the power of the EU, a speeded merger control is required to formulate gatekeeping platforms necessary to tackle the growing start-up installation strategies of the companies which primarily consist of developing technologies.
High profile business deals such as the acquisition of Skype by Microsoft in 2011 was noticed all over the world but smaller deals where the big fish acquired relatively smaller companies go unnoticed such as the acquisition of an artificial intelligence firm in the UK by Apple in 2019 (UK is not part of EU anymore).
EU’s competition chief Margrethe Vestager stated that she will slam this shopping spree in Europe. The stance which Germany, the Netherlands, and France took is of substantial potential as they are right to raise concern over the growing competition among the big tech companies which is leading them to bend all kinds of rules and regulations.
President of the CyberPeace Institute, Marietje Schaake, reportedly said that now the mergers and acquisitions have become part of the game instead of growth requisite. Companies buy smaller companies such as Facebook bought Instagram and WhatsApp at a profusely high price to kill potential competition in the future.
France, Germany, and the Netherlands released an official statement asking the EU to adopt effective regulations and devise newer rules to stop these predatory acquisitions which are termed mergers.
EU states have decided to discuss the Digital Markets Act proposal at great length to have a healthy debate on it and finalize if it should be converted into law or not passed by all 27 nations of the European Union.
According to the data, the big tech giants such as Amazon, Google, Facebook, Apple, and Microsoft have acquired over 1000 small tech firms but these deals were not prohibited and also went unnoticed. Now is the high time for the EU to devise a certain plan to deal with these mergers known as a business acquisition to halt the rapidly growing power of big tech companies.