Regulating Big Tech: The Digital Markets Act
In its recent report “Anticompetitive Practices by Big Tech Companies,” the Parliamentary Standing Committee on Finance has called for the implementation of a new layer of law, similar to the EU’s Digital Markets Act (DMA), to address the issues posed by large, systemic online platforms. The DMA establishes a set of objective criteria for identifying and regulating “gatekeeper” companies that hold significant power in the digital marketplace.
The Criteria for a “Gatekeeper”
- The DMA’s criteria for identifying a “gatekeeper” company are narrowly defined and well targeted towards the problem at hand. In order to qualify as a gatekeeper, a company must meet the following criteria:
- Strong Economic Position: The company holds a strong economic position and has a significant impact on the internal market, operating in multiple EU countries.
- Strong Intermediation Position: The company links a large user base to a large number of businesses through its intermediation services.
- Entrenched and Durable Position: The company has (or is about to have) an entrenched and durable position in the market, meaning that it is stable over time. To meet this criterion, the company must have met the first two criteria in each of the last three financial years.
The Benefits of the DMA
- The DMA has several benefits for businesses, consumers, and technology start-ups. These include:
- A Fairer Business Environment: Businesses that rely on gatekeepers to offer their services in the single market will have a fairer business environment, free from unfair terms and conditions that limit their development.
- New Opportunities for Competition and Innovation: Innovators and technology start-ups will have new opportunities to compete and innovate in the online platform environment.
- More and Better Services for Consumers: Consumers will have more and better services to choose from, more opportunities to switch providers, direct access to services, and fairer prices.
- Innovation and New Services for Gatekeepers: Gatekeepers will still be able to innovate and offer new services. However, they will not be allowed to use unfair practices to gain an undue advantage over businesses and customers that depend on them.
The DMA represents a well-targeted solution for addressing the issues posed by large, systemic online platforms. By establishing a set of objective criteria for identifying and regulating “gatekeeper” companies, the DMA aims to create a fairer business environment for businesses and consumers, as well as new opportunities for competition and innovation.
Written by IAS POINT