Big technology has more lobbying firepower in Brussels than any other industry, spending €97 million a year to influence European Union legislation on the digital sector.
American companies in the crosshairs of European Commission regulators are the biggest spenders, with Google, Facebook and Microsoft splashing out more than €5 million each annually.
A new report by the Corporate Europe Observatory and LobbyControl, transparency campaigners, shows that lobbying by the technology industry has overtaken the traditional giants of pharma, fossil fuels, finance and chemicals.
The findings indicate the extent of structural changes to the world economy over the past decade from Silicon Valley to rising Chinese contenders in Shenzhen.
More than 600 digital companies are in the Brussels lobbying game but just ten tech giants spend a third of the cash, over €32 million, mainly through consultancies.
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In recent years, Brussels has been at the forefront of digital regulation on data protection, competition, taxation and rules on the content of social media platforms. Google has spent €5.8 million a year to try to soften the blows from Brussels. Of the top 10 big spenders, eight are American companies; one, Huawei is Chinese, spending €3.5 million; with Vodafone, a European company, bringing up the rear with €1.8 million.
The balance of spending reflects the US dominance of the digital sectors and the EU’s determination to regulate big tech, which some say is driven by hostility to American companies.
Margrethe Vestager, the EU’s head of digital and competition policy, was accused by Donald Trump of “hating” the US. While President Biden has patched up relations with the EU, tensions remain with Washington continuing to warn of “protectionist” policies.
Lobbying is particularly intense at present over the EU’s Digital Markets Act, which includes wide-ranging legislation to restructure competition. As well as encroaching on market dominance, the EU legislation means Facebook or Amazon could face fines of billions of euros over online hate speech or the sale of illegal goods.
Senior EU figures have identified Google, Amazon, Apple, Facebook and Microsoft as the main targets of the legislation. Big tech is accused by campaigners, competitors and some regulators of seeking to hold a status quo business model based on unchallenged market domination.
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“Faced with increased criticism of these companies’ business practices and models, these firms are now trying to ‘reset the narrative’,” the report says. “The time of being proud of the motto ‘move fast, break things’ is behind us.”
It concludes that “big tech’s huge lobbying budgets have a significant impact on EU policymakers, who find digital lobbyists knocking on their door on a regular basis”.
Over the past year high-level commission officials held 271 meetings related to the digital sector, 75 per cent of them with industry lobbyists. Google and Facebook led the pack.
“Meeting minutes, leaked lobbying strategies and position papers show big tech are still lobbying against them, trying their best to water down any hard rules,” the researchers concluded.
Tommaso Valletti, former chief economist of the competition directorate in the commission and now a professor of economics at Imperial College London, said his former colleagues needed to resist the lobbying.
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“The economic and political power of the digital giants is hefty, and they are not going to remain passive in the face of possible new rules that affect the way they conduct their business,” he said. “That‘s why the EU institutions urgently need to change the way they handle this lobbying and limit the power of big tech.”
