Digital Markets Act (DMA) overview
The Digital Markets Act establishes a set of clearly defined objective criteria to qualify a large online platform as a “gatekeeper” and ensures that they behave in a fair way online and leave room for contestability. The Digital Markets Act is one of the centrepieces of the European digital strategy.
What are gatekeepers?
Gatekeepers are large digital platforms providing any of a pre-defined set of digital services (‘core platform services’), such as online search engines, app stores, and messenger services. These companies have:
- a strong economic position, significant impact on the internal market and are active in multiple EU countries;
- a strong intermediation position, meaning that they link a large user base to a large number of businesses;
- an entrenched and durable position in the market, meaning that their position has been stable over time.
On 6 September 2023 the European Commission designated for the first time six gatekeepers - Alphabet, Amazon, Apple, ByteDance, Meta, Microsoft. In total, 22 core platform services provided by those gatekeepers have been designated.
What are the benefits of the Digital Markets Act?
- Business users who depend on gatekeepers to offer their services in the single market will have a fairer business environment.
- Innovators and technology start-ups will have new opportunities to compete and innovate in the online platform environment without having to comply with unfair terms and conditions limiting their development.
- Consumers will have more and better services to choose from, more opportunities to switch their provider if they wish so, direct access to services, and fairer prices.
- Gatekeepers will keep all opportunities to innovate and offer new services. They will simply not be allowed to use unfair practices towards the business users and customers that depend on them, in order to gain an undue advantage.
Clear gatekeeper obligations across the EU
The new rules establish obligations for gatekeepers, “do’s” and “don’ts” they must comply with in their daily operations.
Examples of the “do’s” - Gatekeeper platforms have to:
allow third parties to inter-operate with the gatekeeper’s own services in certain specific situations;
allow their business users to access the data that they generate in their use of the gatekeeper’s platform;
provide companies advertising on their platform with the tools and information necessary for advertisers and publishers to carry out their own independent verification of their advertisements hosted by the gatekeeper;
allow their business users to promote their offer and conclude contracts with their customers outside the gatekeeper’s platform.
treat services and products offered by the gatekeeper itself more favourably in ranking than similar services or products offered by third parties on the gatekeeper's platform;
prevent consumers from linking up to businesses outside their platforms;
prevent users from un-installing any pre-installed software or app if they wish so;
track end users outside of the gatekeepers' core platform service for the purpose of targeted advertising, without effective consent having been granted.
What will be the consequences of non-compliance?
- Fines
of up to 10% of the company’s total worldwide annual turnover, or up to 20% in the event of repeated infringements
- Periodic penalty payments
of up to 5% of the average daily turnover
- Remedies
In case of systematic infringements of the DMA obligations by gatekeepers, additional remedies may be imposed on the gatekeepers after a market investigation. Such remedies will need to be proportionate to the offence committed. If necessary and as a last resort option, non-financial remedies can be imposed. These can include behavioural and structural remedies, e.g. the divestiture of (parts of) a business.
What the new rules mean for users, businesses and platforms
Find out more on new rules for users
Find out more on new rules for businesses
Find out more on new rules for platforms
Legal certainty for platforms
Until now, national legislative initiatives in EU Member States partially addressed the problems identified but also lead to increased regulatory fragmentation in the EU. This can create increased compliance costs for platforms operating cross-border.
What the new Digital Markets Act changes:
- Gatekeepers have clearly defined obligations that they need to respect.
- Other platforms, like smaller players, SMEs and innovative start-ups, will not be subject to these rules but will be able to benefit from fairer behaviours when doing businesses with gatekeepers.
- Reduced compliance costs for gatekeepers and their business users.
How will the Commission ensure that the DMA keeps up with the fast evolving digital sector?
To ensure that the new gatekeeper rules keep up with the fast pace of digital markets, the Commission will carry out market investigations. These will allow the Commission to:
- qualify companies as gatekeepers;
- update dynamically the obligations for gatekeepers when necessary;
- design remedies to tackle systematic infringements of the DMA’s rules.