Digital Markets Act (DMA)
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Summary
The Digital Markets Act (DMA) establishes harmonised rules to ensure contestable and fair markets in the digital sector by imposing ex ante obligations on large online platforms designated as “gatekeepers”. It sets criteria and a designation process for gatekeepers providing “core platform services” and lays down a list of do’s and don’ts (e.g., bans on self-preferencing and certain tying practices, and obligations on data access, portability and interoperability). The European Commission is the sole enforcer and may conduct market investigations, impose fines and periodic penalty payments, and adopt behavioural or structural remedies for systematic non-compliance.
Who is affected?
Providers of core platform services that meet the DMA thresholds and are designated by the European Commission as gatekeepers. Business users and end users of those services are indirectly affected through new rights (e.g., choice, portability, access to data) and changes to platform practices.
Scope
Applies to designated gatekeepers providing core platform services in the EU, regardless of where the provider is established.
Key Points
- Defines “core platform services” (e.g., online intermediation services/app stores, search engines, social networks, video-sharing platform services, number-independent interpersonal communications services, operating systems, web browsers, online advertising services).
- Establishes quantitative presumptions for gatekeeper status and a Commission-led designation procedure, with the possibility of rebuttal and market investigations.
- Imposes directly applicable obligations and prohibitions on gatekeepers (including restrictions on self-preferencing, certain tying/bundling, and use of non-public business user data to compete against business users).
- Requires measures such as data access for business users/advertisers, data portability for end users, and interoperability obligations for certain messaging services (phased in).
- Provides strong enforcement: Commission investigatory powers, fines up to 10% of worldwide turnover (20% for repeated infringements), and periodic penalty payments; structural remedies possible for systematic non-compliance.
- Includes mechanisms for updating obligations and addressing new practices via market investigations.
Key Deadlines
- — Deadline for potential gatekeepers to notify the Commission that they meet the quantitative thresholds (2 months after application date).
- — Indicative deadline for the Commission to designate gatekeepers following a complete notification (45 working days).
- — Deadline for first designated gatekeepers to comply with DMA obligations (6 months after designation decisions of 6 September 2023).
Related Regulations
Frequently Asked Questions
Who must comply with the Digital Markets Act (DMA)?
The DMA applies to providers of core platform services that are designated as 'gatekeepers' by the European Commission based on specific quantitative and qualitative criteria.
What is the scope of the DMA?
The DMA covers designated gatekeepers providing core platform services in the EU, regardless of where the company is established, as long as their services have a significant impact on the EU internal market.
How does the European Commission designate a gatekeeper?
The Commission uses quantitative thresholds (such as turnover, market capitalisation, and user numbers) and a formal designation procedure, which can be rebutted by the provider or supplemented by market investigations.
What are the key obligations imposed on gatekeepers?
Gatekeepers must comply with a list of do’s and don’ts, including prohibitions on self-preferencing, certain tying and bundling practices, and restrictions on using non-public business user data to compete against those users. They must also ensure data portability, access, and interoperability in certain cases.
What penalties can be imposed for non-compliance with the DMA?
The Commission can impose fines of up to 10% of a gatekeeper’s worldwide turnover (20% for repeated infringements), periodic penalty payments, and, in cases of systematic non-compliance, structural remedies such as divestitures.
How does the DMA interact with other EU regulations?
The DMA complements, but does not replace, existing EU competition law and sector-specific regulations. It provides ex ante obligations, while competition law continues to apply ex post.
What practical steps should a company take to ensure compliance with the DMA?
Potential gatekeepers should monitor their status against the DMA thresholds, prepare for possible designation, review and adapt their business practices to meet the DMA’s obligations, and establish compliance and reporting mechanisms.
What is the timeline for compliance once designated as a gatekeeper?
Once designated, a gatekeeper must comply with the DMA’s obligations within six months, unless otherwise specified for certain phased-in requirements.
Can the obligations under the DMA be updated or expanded?
Yes, the Commission can update the list of obligations and address new practices through market investigations and delegated acts.
Who enforces the DMA and how are investigations conducted?
The European Commission is the sole enforcer, with powers to conduct market investigations, request information, carry out inspections, and impose penalties for non-compliance.
Key Terms
- Gatekeeper
- A provider of core platform services designated by the European Commission as having a significant impact on the internal market, serving as an important gateway for business users to reach end users.
- Core Platform Services
- Digital services covered by the DMA, including online intermediation services, search engines, social networks, video-sharing platforms, operating systems, web browsers, and online advertising services.
- Self-preferencing
- A prohibited practice where a gatekeeper favours its own products or services over those of third parties on its platform.
- Tying and Bundling
- Practices where a gatekeeper requires users to use or purchase additional services as a condition for accessing a core platform service, restricted under the DMA.
- Data Portability
- The obligation for gatekeepers to enable end users to easily transfer their data to another service provider.
- Interoperability
- Requirements for certain core platform services, particularly messaging services, to work with competing services, allowing users to communicate across platforms.
- Market Investigation
- A procedure by which the Commission examines whether a provider should be designated as a gatekeeper, or whether new obligations should be introduced or updated.
- Structural Remedies
- Measures such as divestitures imposed by the Commission in cases of systematic non-compliance to restore contestability and fairness in the market.
- Periodic Penalty Payments
- Recurring financial penalties imposed by the Commission to ensure ongoing compliance with the DMA’s obligations.
- Business User
- Any natural or legal person who uses core platform services provided by a gatekeeper to offer goods or services to end users.