Platform Competition and Opportunity Act of 2021

I 117TH CONGRESS 1ST SESSION H. R. 3826 To promote competition and economic opportunity in digital markets by establishing that certain acquisitions by dominant online platforms are unlawful. IN THE HOUSE OF REPRESENTATIVES JUNE 11, 2021 Mr. JEFFRIES (for himself, Mr. BUCK, Mr. CICILLINE, Mr. NADLER, and Mr. GOODEN of Texas) introduced the following bill; which was referred to the Committee on the Judiciary A BILL To promote competition and economic opportunity in digital markets by establishing that certain acquisitions by dom- inant online platforms are unlawful. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Platform Competition 4 and Opportunity Act of 2021’’. 5 SEC. 2. UNLAWFUL ACQUISITIONS. 6 (a) VIOLATION.—It shall be unlawful for a covered 7 platform operator to acquire directly or indirectly— 8 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 3826 IH (1) the whole or any part of the stock or other 1 share capital of another person engaged in com- 2 merce or in any activity or affecting commerce; or 3 (2) the whole or any part of the assets of an- 4 other person engaged in commerce or in any activity 5 affecting commerce. 6 (b) EXCLUSION.—An acquisition shall not be unlaw- 7 ful under subsection (a) if the acquiring covered platform 8 operator demonstrates by clear and convincing evidence 9 that— 10 (1) the acquisition is a transaction that is de- 11 scribed in section 7A(c) of the Clayton Act; or 12 (2) the acquired assets or the issuer of the ac- 13 quired stock do not— 14 (A) compete with the covered platform or 15 with the covered platform operator for the sale 16 or provision of any product or service; 17 (B) constitute nascent or potential com- 18 petition to the covered platform or the covered 19 platform operator for the sale or provision of 20 any product or service; 21 (C) enhance or increase the covered plat- 22 form’s or the covered platform operator’s mar- 23 ket position with respect to the sale or provision 24 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 3826 IH of any product or service offered on or directly 1 related to the covered platform; or 2 (D) enhance or increase the covered plat- 3 form’s or covered platform operator’s ability to 4 maintain its market position with respect to the 5 sale or provision of any product or service of- 6 fered on or directly related to the covered plat- 7 form. 8 (c) USER ATTENTION.—For purposes of this Act, 9 competition, nascent competition, or potential competition 10 for ‘‘the sale or provision of any product or service’’ in- 11 cludes competition for a user’s attention. 12 (d) ROLE OF DATA.—For purposes of this Act, an 13 acquisition that results in access to additional data may, 14 without more, enhance, increase, or maintain a covered 15 platform’s market position. 16 SEC. 3. DEFINITIONS. 17 (a) ANTITRUST LAWS.—The term ‘‘antitrust laws’’ 18 has the meaning given the term in subsection (a) of sec- 19 tion 1 of the Clayton Act (15 U.S.C. 12). 20 (b) COMMISSION.—The term ‘‘Commission’’ means 21 the Federal Trade Commission. 22 (c) CONTROL.—The term ‘‘control’’ with respect to 23 a person means— 24 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 3826 IH (1) holding 25 percent or more of the stock of 1 the person; 2 (2) having the right to 25 percent or more of 3 the profits of the person; 4 (3) having the right to 25 percent or more of 5 the assets of the person, in the event of the person’s 6 dissolution; 7 (4) if the person is a corporation, having the 8 power to designate 25 percent or more of the direc- 9 tors of the person; 10 (5) if the person is a trust, having the power 11 to designate 25 percent or more of the trustees; or 12 (6) otherwise exercises substantial control over 13 the person. 14 (d) COVERED PLATFORM.—The term ‘‘covered plat- 15 form’’ means an online platform— 16 (1) that has been designated as a ‘‘covered plat- 17 form’’ under section 4(a); or 18 (2) that— 19 (A) at the time of the Commission’s or the 20 Department of Justice’s designation under sec- 21 tion 2(d), or any of the twelve months pre- 22 ceding that time, or in any of the 12 months 23 preceding the filing of a complaint for an al- 24 leged violation of this Act— 25 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 3826 IH (i) has at least 50,000,000 United 1 States-based monthly active users on the 2 online platform; or 3 (ii) has at least 100,000 United 4 States-based monthly active business users 5 on the platform; 6 (B) is owned or controlled by a person 7 with net annual sales, or a market capitaliza- 8 tion greater than $600,000,000,000, adjusted 9 for inflation on the basis of the Consumer Price 10 Index, at the time of the Commission’s or the 11 Department of Justice’s designation under sec- 12 tion 4(a) or any of the two years preceding that 13 time, or at any time in the 2 years preceding 14 the filing of a complaint for an alleged violation 15 of this Act; and 16 (C) is a critical trading partner for the sale 17 or provision of any product or service offered on 18 or directly related to the online platform. 19 (e) COVERED PLATFORM OPERATOR.—The term 20 ‘‘covered platform operator’’ means a person that, directly 21 or indirectly, owns or controls a covered platform. 22 (f) CRITICAL TRADING PARTNER.—The term ‘‘crit- 23 ical trading partner’’ means an entity that has the ability 24 to restrict or impede— 25 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 3826 IH (1) the access of a business user to its users or 1 customers; or 2 (2) the access of a business user to a tool or 3 service that needs to effectively serve its users or 4 customers. 5 (g) BUSINESS USER.—The term ‘‘business user’’ 6 means a person that utilizes or plans to utilize the covered 7 platform for the sale or provision of products or services. 8 (h) ONLINE PLATFORM.—The term ‘‘online plat- 9 form’’ means a website, online or mobile application oper- 10 ating system, digital assistant, or online service that— 11 (1) enables a user to generate content that can 12 be viewed by other users on the platform or to inter- 13 act with other content on the platform; 14 (2) facilitates the offering, sale, purchase, pay- 15 ment, or shipping of goods or services, including 16 software applications, between and among con- 17 sumers or businesses not controlled by the platform; 18 or 19 (3) enables user searches or queries that access 20 or display a large volume of information. 21 (i) PERSON.—The term ‘‘person’’ has the meaning 22 given the term in subsection (a) of section 1 of the Clayton 23 Act (15 U.S.C. 12). 24 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 3826 IH SEC. 4. IMPLEMENTATION. 1 (a) COVERED PLATFORM DESIGNATION.— 2 (1) The Federal Trade Commission or Depart- 3 ment of Justice shall designate whether an entity is 4 a covered platform for the purpose of implementing 5 and enforcing this Act. Such designation shall— 6 (A) be based on a finding that the criteria 7 set forth in section 3(d)(2)(A)–(C) are met; 8 (B) be issued in writing and published in 9 the Federal Register; and 10 (C) will apply for 10 years from its 11 issuance regardless of whether there is a change 12 in control or ownership over the covered plat- 13 form unless the Commission or the Department 14 of Justice removes the designation pursuant to 15 subsection (b). 16 (b) REMOVAL OF COVERED PLATFORM DESIGNA- 17 TION.—The Commission and the Department of Justice 18 shall— 19 (1) consider whether its designation of a cov- 20 ered platform pursuant to subsection (a) should be 21 removed prior to the expiration of the 10-year period 22 if the covered platform operator files a request with 23 the Commission or the Department of Justice, which 24 shows that the online platform is no longer a critical 25 trading partner; 26 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 3826 IH (2) determine whether to grant a request sub- 1 mitted under paragraph 1 not later than 120 days 2 after the date of the filing of such request; and 3 (3) obtain the concurrence of the Commission 4 or the Department of Justice, as appropriate, before 5 granting a request submitted under paragraph (1). 6 SEC. 5. ENFORCEMENT. 7 (a) ENFORCEMENT PROCEEDING.—The Commission, 8 Department of Justice, and any attorney general of a 9 State subject to the requirements in subsection (d) shall 10 enforce this Act in the same manner, by the same means, 11 and with the same jurisdiction, powers, and duties as 12 though all applicable terms and provisions of the Federal 13 Trade Commission Act (15 U.S.C. 41 et seq.) or the Clay- 14 ton Act (15 U.S.C. 12 et seq.), as appropriate, were incor- 15 porated into and made a part of this Act. 16 (b) UNFAIR METHODS OF COMPETITION.—A viola- 17 tion of this Act shall also constitute an unfair method of 18 competition under section 5 of the Federal Trade Commis- 19 sion Act (15 U.S.C. 5). 20 (c) COMMISSION INDEPENDENT LITIGATION AU- 21 THORITY.—If the Commission has reason to believe that 22 a covered platform violated this Act, the Commission may 23 commence a civil action, in its own name by any of its 24 attorneys designated by it for such purpose, to recover a 25 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 3826 IH civil penalty and seek other appropriate relief in a district 1 court of the United States against the covered platform 2 operator. 3 (d) PARENS PATRIAE.—Any attorney general of a 4 State may bring a civil action in the name of such State 5 for a violation of this Act as parens patriae on behalf of 6 natural persons residing in such State, in any district 7 court of the United States having jurisdiction of the de- 8 fendant, and may secure any form of relief provided for 9 in this section. 10 SEC. 6. ENFORCEMENT GUIDELINES. 11 (a) IN GENERAL.—Not later than 1 year after the 12 date of enactment of this Act, the Commission and the 13 Assistant Attorney General of the Antitrust Division shall 14 jointly issue guidelines outlining policies and practices, re- 15 lating to agency enforcement of this Act, with the goal 16 of promoting transparency and deterring violations. 17 (b) UPDATES.—The Commission and the Assistant 18 Attorney General of the Antitrust Division shall update 19 the joint guidelines issued under subsection (a), as needed 20 to reflect current agency policies and practices, but not 21 less frequently than once every 4 years beginning on the 22 date of enactment of this Act. 23 (c) OPERATION.—The Joint Guidelines issued under 24 this section do not confer any rights upon any person, 25 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 3826 IH State, or locality, nor shall operate to bind the Commis- 1 sion, Department of Justice, or any person, State, or local- 2 ity to the approach recommended in such Guidelines. 3 SEC. 7. SUITS BY PERSONS INJURED. 4 (a) IN GENERAL.—Except as provided in subsection 5 (b), any person who shall be injured in his business or 6 property by reason of anything forbidden in this Act sue 7 therefor in any district court of the United States in the 8 district in which the defendant resides or is found or has 9 an agent, without respect to the amount in controversy, 10 and shall recover threefold the damages by him sustained, 11 and the cost of suit, including a reasonable attorney’s fee. 12 The court may award under this section, pursuant to a 13 motion by such person promptly made, simple interest on 14 actual damages for the period beginning on the date of 15 service of such person’s pleading setting forth a claim 16 under the antitrust laws and ending on the date of judg- 17 ment, or for any shorter period therein, if the court finds 18 that the award of such interest for such period is just in 19 the circumstances. In determining whether an award of 20 interest under this section for any period is just in the 21 circumstances, the court shall consider only— 22 (1) whether such person or the opposing party, 23 or either party’s representative, made motions or as- 24 serted claims or defenses so lacking in merit as to 25 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 3826 IH show that such party or representative acted inten- 1 tionally for delay, or otherwise acted in bad faith; 2 (2) whether, in the course of the action in- 3 volved, such person or the opposing party, or either 4 party’s representative, violated any applicable rule, 5 statute, or court order providing for sanctions for 6 dilatory behavior or otherwise providing for expedi- 7 tious proceedings; and 8 (3) whether such person or the opposing party, 9 or either party’s representative, engaged in conduct 10 primarily for the purpose of delaying the litigation 11 or increasing the cost thereof. 12 (b) AMOUNT OF DAMAGES PAYABLE TO FOREIGN 13 STATES AND INSTRUMENTALITIES OF FOREIGN 14 STATES.— 15 (1) Except as provided in paragraph (2), any 16 person who is a foreign state may not recover under 17 subsection (a) an amount in excess of the actual 18 damages sustained by it and the cost of suit, includ- 19 ing a reasonable attorney’s fee. 20 (2) Paragraph (1) shall not apply to a foreign 21 state if— 22 (A) such foreign state would be denied, 23 under section 1605(a)(2) of title 28, United 24 States Code, immunity in a case in which the 25 VerDate Sep 11 2014 01:09 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H3826.IH H3826 kjohnson on DSK79L0C42PROD with BILLS 12 •HR 3826 IH action is based upon a commercial activity, or 1 an act, that is the subject matter of its claim 2 under this section; 3 (B) such foreign state waives all defenses 4 based upon or arisin [Text truncated for display. 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