The Regulation of Foreign Platforms
72 Pages Posted: 2 Jul 2021 Last revised: 3 Aug 2021
Date Written: June 20, 2021
In August 2020, the Trump Administration issued twin executive orders banning tech platforms TikTok and WeChat from the United States. These were not the first actions taken against Chinese tech platforms, but more than any others, the ban on TikTok sparked immediate outrage, confusion, and criticism. This Article offers a framework for thinking about national security restrictions on foreign tech platforms. A growing body of important scholarship connects tech platforms to “regulated industries,” “infrastructure industries,” and “public utilities” and draws on principles from them to show how the regulation of tech platforms is not only viable but also has significant precedents and pedigree. Firms in these sectors — banking, communications, transportation, and energy — have long been subject to distinct and comprehensive regulatory regimes because they raise political economy concerns that are unlike those of ordinary tradable goods and services.
In many of these sectors, there has also been a long and continuing history of legal restrictions on the foreign ownership, control, and influence of platforms — something that may be surprising, given the contours of the contemporary debate on tech platforms. “Tech neoliberals” object to placing any restrictions on foreign tech platforms because regulations would threaten the open internet. “National security technocrats” advocate for a case-by-case assessment of dangers, narrowly tailored mitigation measures, and audits to ensure compliance. Both of these dominant paradigms suffer from a variety of conceptual and practical problems, and neither take foreign tech platforms seriously as platforms, akin to platforms in other sectors.
This Article tells the history of restrictions on foreign platforms in traditional regulated industries, critiques the dominant paradigms in the debate over foreign tech platforms, and offers an alternative — platform democracy. The platform democracy approach recognizes that democratic control of platforms is important and legitimate, given their distinctive political economy. Taking lessons and strategies from the history of platform restrictions, it suggests focusing on sectors before specific firms and applying structural separations rather than complex formulae for preventing national security harms. The platform democracy approach would also require efforts at international interconnection and domestic public investments.
Keywords: Tech Platforms, Big Tech, TikTok, Foreign Ownership, Separation of Ownership and Control, Foreign Relations Law, Regulated Industries, National Security, Banking, Energy, Communications, Transportation, Technology, Public Utilities
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