Digital Markets Act: European Union adopts new “competition” rules for certain digital platforms – Antitrust, EU Competition
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The European Parliament (“EP”) and the Council formally adopted the Digital Markets Act (“DMA”) in July 2022, imposing new behavioral obligations on large digital platforms qualified as “gatekeepers”. The final agreement introduces several changes from the initial proposal detailed in our January 2021 Comment, the most significant of which are: raising the thresholds qualifying a company as a gatekeeper; adding web browsers and virtual assistants to the list of core platform services; additional behavioral obligations, including an interoperability requirement for messaging services; and new penalties for pattern violations such as a temporary ban on custodian mergers and acquisitions.
The European Commission (“EC”) originally proposed DMA in December 2020 with the stated aim of promoting fair and contestable markets in the digital sector. The DMA is an unprecedented change in the European Union’s oversight of major digital platforms. Historically, the EC has observed a ‘law enforcement’ approach when tackling the behavior of digital platforms, investigating and sanctioning behavior only when it believes that a practice breaches EU privacy law. competition. DMA, however, is a more regulatory approach that removes the burden on ECs to analyze and prove market definition, market power and efficiencies.
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