Digital Markets Act: Political Agreement between European lawmakers

On 15 December 2020, the European Commission proposed the so-called “Digital Markets Act” (DMA), a new law to address the negative consequences arising from certain behaviours by online platforms acting as digital “gatekeepers” to the EU single market. When a gatekeeper engages in business practices such as favouring its own services or preventing its own business users from reaching consumers, it can prevent or slow down valuable and innovative services of its business users and competitors. Furthermore, when a gatekeeper engages in unfair practices such as imposing unfair access conditions to their app store or preventing installation of applications from other sources, consumers are likely to pay more or are even effectively deprived of the benefits that alternative services might have brought.

On 25 March 2022, the two lawmakers of the European Union, the European Parliament and the Council, reached a political agreement on the DMA in slightly more than a year after it was proposed. As intended by the proposal of the European Commission, it will blacklist certain practices used by large platforms acting as gatekeeper and enable the European Commission to carry out market investigations and to sanction non-compliant behaviour. According to the Parliament’s press release, the text provisionally agreed by Parliament and Council negotiators targets large companies providing so-called “core platform services” most prone to unfair business practices, such as social networks or search engines, with a market capitalisation of at least EUR 75 bio. or an annual turnover of EUR 7,5 bio. To be designated as “gatekeepers”, these companies must also provide certain services such as browsers, messengers or social media, which have at least 45 mio. monthly end users in the EU and 10’000 annual business users.

The EU lawmakers agreed that the largest messaging services (such as Whatsapp, Facebook Messenger or iMessage) will have to interoperate with smaller messaging platforms, if they request so. Users of small or big platforms would then be able to exchange messages, send files or make video calls across messaging apps, thus giving them more choice. The lawmakers also ensured that combining personal data for targeted advertising will only be allowed with explicit consent to the gatekeeper. They also managed to include a requirement to allow users to freely choose their browser, virtual assistants, or search engines.

If a gatekeeper does not comply with the rules, the European Commission might be able to impose fines of up to 10% of its total worldwide turnover in the preceding financial year, and 20% in case of repeated infringements. In case of systematic infringements, the European Commission may ban them from acquiring other companies for a certain time. The political agreement reached by the European Parliament and the Council is now subject to formal approval by the two co-legislators. Once adopted, the DMA will be directly applicable across the EU and will apply six months after entry into force.

These are the upcoming dates for our Annual General Meetings:

Thursday, 21 March 2024
Thursday, 20 March 2025