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Senator Mark Warner: Beware of regulating U.S. tech companies in a way that gives Chinese tech companies an advantage

Splitting up big tech could create an opening for foreign competitors.

U.S. Senator Mark Warner Asa Mathat

If politicians in the U.S. make the mistake of over-regulating big tech, Chinese competitors could easily take over the market, according to U.S. Senator Mark Warner.

When asked if tech giants should be broken up under antitrust laws, Sen. Warner, speaking onstage at Code Conference in Rancho Palos Verdes, Calif., said regulators need to be careful not to be too “heavy-handed” because breaking up those companies could create an opening for Chinese competitors.

“If we simply replace those entities, market entities, with Alibaba and Tencent and have them combine their information with a billion people in the world of artificial intelligence they start with a bigger end, that may give them a bigger lead that no other companies can catch up with,” he said.

Warner, who early in his career was a successful tech investor and cofounded Nextel, has been a vocal critic of the industry as the top Democrat on the Senate Intelligence Committee. That group has been investigating the influence of foreign actors in the U.S. presidential election — but here he was quick to also caution about the risks of over-regulating.

“I don’t come in with the notion that a regulatory framework is necessarily the right answer, because I’ve seen how that can screw up innovation. But completely unfettered or, ‘Don’t worry, we’re going to self-regulate alone,’ I just don’t think that’s going to cut it,” said Warner.

Separately, Warner said Chinese tech companies are operating under a different set of loyalties than U.S. tech companies.

“In tech, Chinese are operating in a different rule book than we are,” he said. “The major Chinese tech companies -- Alibaba, Baidu Tencent…they are all penetrated deeply by the Communist party. At the end of the day, they owe as much allegiances to their government as they do their shareholders.”

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This article originally appeared on Recode.net.