In a monumental move designed to foster fair and open markets within the digital sector, the European Commission today designated six of the largest tech corporations as ‘gatekeepers’ under the newly enacted Digital Markets Act (DMA). This initiative marks the first instance of the commission utilizing the powers vested by the DMA to regulate large online platforms that substantially influence the digital economy.
The corporations identified as gatekeepers in this groundbreaking announcement are Alphabet, Amazon, Apple, ByteDance, Meta, and Microsoft, with 22 core platform services falling under the purview of the DMA. These companies will now be mandated to comply with the DMA’s stipulations within the next six months for each identified core service.
Thierry Breton, the Commissioner for the Internal Market, remarked on the development, stating: “More choice for consumers, fewer obstacles for smaller competitors: the DMA will open the gates to the Internet. With today’s designation we are finally reining in the economic power of 6 gatekeepers, giving more choice to consumers and creating new opportunities for smaller innovative tech companies, thanks for instance to interoperability, sideloading, real-time data portability and fairness. It was high time that Europe sets the rules of the game upfront, to ensure digital markets are fair and open.”
Commissioner Didier Reynders echoed these sentiments, highlighting the potential for a more balanced digital marketplace: “The Digital Markets Act will help creating a level-playing field for all companies competing in the European digital market, as it will bring about more contestability and openness in markets. Today, we identified the first six gatekeepers that must respect the new rules set forth by the DMA.”
A Closer Examination of Gatekeepers
The designation of a ‘gatekeeper’ applies to companies providing at least one of ten core platform services, including online search engines, social networking services, and app stores, and meeting specific quantitative criteria, including the provision of services to over 45 million monthly end-users and more than 10,000 yearly active business users in the EU. These corporations have been identified as central conduits between businesses and consumers within the digital space, wielding considerable influence over the industry dynamics.
Additionally, the commission has initiated four separate market investigations concerning Apple and Microsoft’s claims that several core platform services, including Bing, Edge, Microsoft Advertising, and iMessage, do not qualify as gatekeepers under the DMA’s criteria. These investigations are set to unfold over the coming months, aiming to validate or refute the companies’ arguments.
Forward Steps and Compliance Regulations
The designated corporations will be tasked with adhering to a detailed set of rules outlined in the DMA, promoting increased choice and freedom for both end-users and business users of their services. A crucial part of the compliance process will involve the submission of comprehensive reports detailing how each company intends to fulfil the DMA’s requirements.
Companies failing to comply with the DMA’s obligations face severe financial penalties, including fines amounting to up to 10% of their global turnover, with the potential for this figure to rise to 20% in cases of repeated infringement. The commission has also been empowered to impose additional sanctions, including forcing a company to divest parts of its business or barring it from acquiring additional services in cases of systemic non-compliance.
The DMA, which was enacted in November 2022 and came into effect in May 2023, represents a vital part of the EU’s efforts to curb the influence of digital gatekeepers and promote a more open and competitive market within the digital sector.
For more information, please refer to the official [EU Digital Markets Act webpage]