On his last day in office, DOJ Antitrust Division Assistant Attorney General Makan Delrahim proposed to policymakers and antitrust enforcers the creation of a hybrid public/private digital oversight model that he dubbed the Digital Markets Rulemaking Board (the "DMRB").
In prepared remarks at a conference hosted at Duke University, Mr. Delrahim likened the proposed model for the DMRB to the MSRB, describing the model as a self-regulatory board composed of industry and public members with the expertise to develop "market-based, non-discriminatory rules to promote market integrity." The DMRB would be empowered to create rulemakings that Mr. Delrahim said should focus on data portability, nondiscrimination, interoperability and self-preferencing.
Mr. Delrahim also suggested that Congress implement a pilot for a specialty antitrust district court to hear government civil antitrust actions. Mr. Delrahim explained that antitrust enforcers devote significant resources to educating courts on antitrust law, leading to trial delays that are overall "ill-suited for the rapidly evolving . . . technology sector."
Commentary
The concept of a new self-regulatory organization ("SRO") has broad appeal, particularly in the securities industry. While there is no doubt that FINRA, the most important SRO, serves a critical function in the securities regulatory system, it is not really a "self-regulatory" organization in the plain-English sense of the word. The SEC can require FINRA (and the other securities SROs) to adopt specific rules; and they cannot adopt their own rules without the approval of the SEC. If the securities SROs do not implement the SEC-required regulations, the SROs can be sanctioned by the SEC. In short, securities "self-regulation" is not self-regulation. Notably, FINRA has always operated against a governmental backdrop; i.e., the Securities Exchange Act and the SEC. It seems there would be no comparable structure in place for a DMRB.
Further, the concept of an SRO when applied to the technology market raises many practical questions. Under a DMRB, what industry Board could tell Facebook, Amazon, and Twitter how they might operate? What rules can be drafted, or enforcement mechanisms designed, that were not to the liking of the bigger technology firms? Would a DMRB be authorized to take action if, for example, big technology firms decide to de-platform a sitting President of the United States? And what will the regulators do when the big tech firms decide that smaller tech firms do not qualify to be members of the club?
Primary Sources
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