Competition

Latest draft of Digital Markets Act agreed

Latest draft of Digital Markets Act agreed

Members of the European Parliament (MEPs) last week agreed on the latest draft of the Digital Markets Act (DMA).

The DMA is an ex-ante regulatory tool proposed by the European Commission last year to promote competition in digital markets. The DMA identifies core platform services, sets out a mechanism to designate “gatekeepers” for these core platform services based on a set of quantitative criteria, and provides a list of obligations that gatekeepers need to follow – all in the spirit of promoting contestability and fairness.

MEPs have now agreed on the market value above which firms are designated as gatekeepers. The newly-proposed €80bn threshold is notably lower than the €100bn laid out in a June report by Andreas Schwab, the leading MEP steering the DMA through the legislative process. According to the European Parliament agreement, gatekeepers need to provide at least one core platform service that meets the minimum number of end users, rather than two as per the “Schwab amendment” from June. Combined, these changes will make it more likely that a relatively large set of firms will be in scope for the DMA, in contrast to the previous approach targeted at the largest tech companies.

The European Parliament have now approved the new proposal in committee, with the plenary vote expected later this year. The Competitiveness Council of member states’ ministers is scheduled to endorse the European Council’s general approach for the DMA this Thursday.

Frontier regularly advises organisations and regulators on competition and policy issues in the digital sector.

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