What regulation for digital companies ?

Driven by the dramatic increase in digital needs (amplified by the 2020/21 health crisis, by the rise of telework and e-commerce), these digital companies have gained unprecedented influence on the daily lives of individuals and the functioning of markets. Global commerce control by a few digital platforms has become a threat that risks challenging competition and the basic principles of open society (K. Popper).

In a very short time, we have seen monopolies on a global scale that do not hesitate to use all the strings of tax optimization, GAMAM (Google, Apple, Meta, Amazon, Microsoft) challenging both competition and tax authorities. The denials and arrogance of the

Web majors are commensurate with their power, these giant companies – at the origin of « surveillance capitalism » (Zuboff) – no longer hesitate to minimize the impact of their monopolistic positions and launch oukases from their cyberfiefs, even though they are in a situation of abuse of a dominant position. In any case we cannot count on them to regulate themselves, monopolist one day, monopolist forever.

Competition policy has been established for traditional firms on the basis of old rules designed to ensure that consumers receive the lowest possible prices. Problem: this challenge of weighing on prices does not mean much anymore as GAMAM offer free services. A consensus is being developed on both sides of the Atlantic to adapt antitrust measures (see the Digital Market Act within the European Union).


The tax optimization in question

The tax optimization of declaring turnover and profits in countries that tax the least (Ireland in the case of the European Union) is problematic (Emmanuel Saez and Gabriel Zucman). The solution is undoubtedly through the establishment of an international corporate tax standard (proposal of Joe Biden): each country would retain its sovereign right to set the tax rate it wants, but if it is below a global minimum tax rate, other countries would take over the tax gap. As U.S. Treasury Secretary Janet Yellen put it, “Together we can use a global minimum tax to ensure that the economy thrives on a more level playing field when it comes to taxing multinational corporations.” These new perspectives could change the face of globalization and bring the GAMAM into line. The first step in a tax system adapted to the digital age? A fight is under way but the States should not once again be the magnificent losers.


The market capitalization of GAMAM+NATU has reached stratospheric levels, where oxygen is scarce and zeros are abundant…  The value of these platforms and networks has increased as they have gathered more users, more friends (Facebook, WhatsApp), more colleagues (Skype, Linkedin). Amazon is a special case since a buyer does not care that there are a large number of other customers (who will always remain unknown to him); the value of Amazon is based on infrastructure (no fixed costs related to stores) and economies of scale related to the size of the business. We have witnessed an unprecedented concentration of technological and financial power.

The GAMAM rule over real empires. They have enjoyed great tolerance, governments feared that too much regulation would limit innovation and job creation, but at the same time too few constraints paved the way for predatory practices. We are experiencing a turning point, but it seems certain that no Big Tech giant will accept to easily lose its supremacy.




Beker, The antitrust paradigm, restoring a competitive economy, Harvard University Press, 2019.
Philippon, The Great Reversal, how America gave up on free markets, 2019.
Popper, The open society and its enemies, University of London, 1957.
Saez, G. Zucman, The triumph of injustice, how the rich dodge taxes and how to make them pay, Norton & Co, 2019.
Teulon, « The world according to GAMAM and NATU », IFU-PEM Flash n°2, 2023.
Yellen, Yellen to call for a minimum corporate tax rate, Chicago Council on Global Affairs, 2022.
Zuboff, The age of surveillance capitalism, the fight for a human future at the new frontier of power, 2020.

The experts who participated in this Flash:
Frédéric TEULON
Agrégé d’économie, Ancien élève de Sciences Po Paris et de l’ENS Paris-Saclay