Some large online platforms act as "gatekeepers" in digital markets. The Digital Markets Act aims to ensure that these platforms behave in a fair way online.Together with the Digital Services Act, the Digital Markets Act is one of the centrepieces of the European digital strategy.
Who are the gatekeepers?
The Digital Markets Act (DMA) establishes a set of narrowly defined objective criteria for qualifying a large online platform as a so-called “gatekeeper”. This allows the DMA to remain well targeted to the problem that it aims to tackle as regards large, systemic online platforms.
These criteria will be met if a company:
- has a strong economic position, significant impact on the internal market and is active in multiple EU countries
- has a strong intermediation position, meaning that it links a large user base to a large number of businesses
- has (or is about to have) an entrenched and durable position in the market, meaning that it is stable over time if the company met the two criteria above in each of the last three financial years
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 to gain an undue advantage.
What does this mean for gatekeepers?
The new rules will establish obligations for gatekeepers, “do’s” and “don’ts” they must comply with in their daily operations.
Examples of the “do’s” - Gatekeeper platforms will 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
How will the Commission ensure that the tool 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 Digital Markets Act rules
What will be the consequences of non-compliance?
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
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 are the next steps?
The DMA will be applicable as of beginning of May 2023. Within two months, companies providing core platform services will have to notify the Commission and provide all relevant information. The Commission will then have two months to adopt a decision designating a specific gatekeeper. The designated gatekeepers will have a maximum of six months after the Commission decision to ensure compliance with the obligations foreseen in the DMA.
The Commission intends to organise a number of technical workshops with interested stakeholders to receive their views on gatekeepers’ compliance.