State lawmakers this week are considering a bill meant to curb large companies that seek to get bigger through market dominance strategies like manipulating search engine results or undercutting their competitors' prices.
Lawmakers who support the measure say it is aimed at curtailing the power of big tech companies; business groups however, pointed to the effect the bill could have on the state's economy and innovation.
The sweeping anti-trust legislation, backed by Sen. Michael Gianaris and Assemblyman Jeff Dinowitz, is being pushed for in the final week of the legislative session and is being cast as an update the state's existing anti-monopoly laws.
“Our antitrust laws were written a century ago for a radically different economy and they are in desperate need of reform,” Gianaris said in a statement. “Corporate power has reached unprecedented and dangerous levels, and we need powerful new laws to protect the public and our economy. I am pleased the Senate is taking this historic step and I look forward to this landmark legislation passing the Assembly and becoming law.”
The bill would allow state regulators to take action against companies that seek to create an "abuse of dominance" in the marketplace and swallow up smaller competitors along the way.
"Massive corporations must not be empowered to use their sheer size to circumvent the anti-trust regulations that have been put in place in New York for many years," Dinowitz said. "This important legislation modernizes our law to reflect the new reality that there are new anti-competitive strategies that corporations are using to stifle other companies."
Business organizations over the last day have sought to push back against the bill, arguing the measure would stifle the ability of companies and entrepreneurs to innovate.
"Current standards for antitrust jurisprudence and enforcement rely on consumer welfare," said Tom Stebbins, the executive director of the Lawsuit Reform Alliance. "But rather than allowing the public and the market to decide, this bill creates an undefined 'abuse of dominance' standard, discarding consumer welfare and transferring power to politically motivated government actors and settlement-seeking trial lawyers to pick winners and losers. New York is supposed to be a global leader in technology, finance, and medicine. Lawmakers should be working to cultivate an innovative ecosystem, not champion that it be sued out of existence."
The Business Council in a six-page white paper said the measure seeks to import European standards on business regulations and said the "dominant position" standard is too vague.
"The vagueness of this definition leaves it very poorly tailored to the problem it was meant to solve, and creates an enormous risk that the statute will be applied in an untold number of additional circumstances that the drafters of the legislation probably never intended," the group wrote.