European Union Informs Tech Giants of Digital Markets Act’s Applicability

Seven major tech giants, including Alphabet (Google), Amazon, Apple, ByteDance (TikTok), Meta (Facebook), Microsoft, and Samsung, have been notified by the European Union that they will fall under the Digital Markets Act (DMA), an antitrust regime. The DMA takes an ex ante approach to antitrust enforcement on major platforms that act as intermediaries between digital businesses and consumers.

Digital Markets Act

The DMA lays out a set of obligations and prohibitions that designated gatekeepers, such as the aforementioned tech giants, must follow. These include a ban on self preferencing, limits on the use of third party data, and the requirement to provide third parties with data generated by their apps. App store gatekeepers are not allowed to block sideloading or require developers to use their own services.

Additionally, tracking users for advertising purposes without their consent is also prohibited under the DMA. The aim of the EU is to level the competitive playing field online and prevent unfair and exploitative behaviors that tech giants have engaged in for years.

Encouraging

The European Commission is expected to announce the official designation of gatekeepers later this summer. More companies could potentially be added to the list, although the DMA primarily targets the most powerful platforms. Gatekeepers will have six months to ensure compliance with the DMA once the official designations are announced, with potential enforcement actions by the Commission to follow next year.

Notably, the current DMA list does not include any European tech giants. However, Booking.com, a homegrown travel booking platform, may be added to the list later this year. Booking.com has not self-notified as a gatekeeper yet due to the impact of COVID-19 on its business, but expects to meet the DMA’s thresholds by the end of the year.

Key Points:

• Seven major tech giants, including Alphabet (Google), Amazon, Apple, ByteDance (TikTok), Meta (Facebook), Microsoft, and Samsung, have been informed that the Digital Markets Act (DMA) will apply to them.
• The DMA aims to proactively address unfair and exploitative behaviors by tech giants and level the competitive playing field online.
• Gatekeepers designated under the DMA must comply with a set of obligations and prohibitions, such as a ban on self preferencing and limits on data usage.
• The official designation of gatekeepers will be announced by the European Commission later this summer.
• Booking.com, a European travel booking platform, may be added to the DMA list later this year.