Firms dubbed ‘gatekeepers’ will be forced to share data with rivals and make their services interoperable
The European Commission has named six global tech giants – Alphabet, Amazon, Apple, ByteDance, Meta, and Microsoft – as ‘gatekeepers’ under the new Digital Markets Act (DMA).
The DMA, launched in November last year, aims to make the digital economy fairer by establishing a definitive set of rules for so–called ‘gatekeepers’ – those that have an overwhelmingly dominant position in their respective digital markets and essentially control businesses’ access to customers.
These rules include forcing the companies to share relevant data with rivals and increase the interoperability of their products. It would also force these players to allow device users to decide which apps were preinstalled on their devices.
Companies that do not comply with these stipulations could face fines worth billions of euros.
“We know that some tech giants have used their market power to give their own products and services an unfair advantage and hold back competitors from doing business and creating added value and jobs,” said Thierry Breton, EU internal market commissioner, in a speech this week.
“These practices distort competition, undermine free consumer choice and hold back SMEs’ innovation potential notably arising from Web 4.0 and virtual worlds.”
To qualify as a ‘gatekeeper’, firms must hit certain thresholds, such as having over 45 million active local users and having a turnover of over €7.5 billion in the last three financial years.
As a result, 22 platform services have been indicated in the EU’s initial ruling: TikTok, Facebook, Instagram, LinkedIn (social media services); Google Maps, Google Play, Google Shopping, Amazon Marketplace, iOS App Store, Meta Marketplace (“intermediation” services); Google, Amazon and Meta (ads delivery systems); Chrome, Safari (browsers); Google Android, iOS, Windows PC OS (operating systems); WhatsApp, Facebook Messenger (Number-Independent Interpersonal Communication Service); Google (search engine); and YouTube (video sharing platform).
There are, however, some notable absences from the above list, including web-based email services such as Gmail and Outlook, despite meeting the prerequisite criteria.
“[T]he Commission has concluded that, although Gmail, Outlook.com and Samsung Internet Browser meet the thresholds under the DMA to qualify as a gatekeeper, Alphabet, Microsoft and Samsung provided sufficiently justified arguments showing that these services do not qualify as gateways for the respective core platform services,” noted the EU. “Therefore, the Commission decided not to designate Gmail, Outlook.com and Samsung Internet Browser as core platform services. It follows that Samsung is not designated as gatekeeper with respect to any core platform service.”
The firms will now have until 6th March next year to ensure that they are fully compliant with the Digital Markets Act obligations or else face large fines of up to 20% of their global annual turnover.
‘The DMA will likely face legal challenges from the disgruntled tech giants, who have similarly been challenging its sister law, the Digital Services Act (DSA) of 2022, which regulates the obligations of digital services that act as intermediaries in their role of connecting consumers with goods, services, and content.
In June, both Amazon and Zalando filed legal cases in European courts against the EU’s classification of them as “very large” platforms under the DSA.
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