European Commission Proposed the Digital Markets Act to the European Parliament

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The Digital Markets Act Proposal (“Proposal”) was proposed to the European Parliament by the European Commission (“Commission”) on 15.12.2020.

Proposal presents a set of rules targeting the big online platform companies that are defined as gatekeepers by the Commission. The relevant proposal aims to protect small and medium enterprises in their competition with the big tech companies, and hence, enhance consumer welfare.

Proposal is remarkable as it is one the biggest set of rules addressing big tech companies, which are operating globally and can easily achieve a power to exclude other companies from the market.

The remarkable provisions of Proposal are briefly summarized below:

  • Gatekeeper companies will be identified based on clearly defined conditions and the companies that fit into this definition will have to comply with set of obligations without requiring an additional condition,
  • The interoperability of services of gatekeeper companies and the companies which can compete with the gatekeeper companies will be enhanced
  • Small and medium enterprises will be given access to certain data held by gatekeeper companies,
  • Small and medium enterprises will have access to more information on how their products or services are performing on third party platforms,
  • As a response to the gatekeeper companies’ strategies of favoring their own services, small and medium enterprises will have the opportunity to compete in fair terms and consumers will have the opportunity to reach the best options available to them,
  • The authorities will have the opportunity to take quick measures with the clearly-defined procedural rules as to the application of Proposal

The consequences of non-compliance are briefly summarized below:

  • Companies may be fined up to 10% of their total worldwide annual turnover.
  • Companies may be subject to periodic penalty payments of up to 5% of their average daily turnover.
  • Companies that are found to perform systematic infringements may be subject to additional remedies and provided that the remedies are proportionate to the offence committed, and the remedies are a last resort option, behavioral and structural remedies may be imposed.

Proposal will be directly implemented across the EU after it is accepted in the European Parliament.

You may access the full text of Proposal here.

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