New competition rules and Digital Services Act and criteria for the list of large platforms: market share of revenues and number of users, personal data

New competition rules and Digital Services Act and criteria for the list of large platforms: market share of revenues and number of users, personal data

On 12 October 2020, Romanian member of the European Parliament (MEP) Carmen Avram of the Group of the Progressive Alliance of Socialists and Democrats in the European Parliament posed a written parliamentary question to the European Commission:

“The big, dominant platforms – gatekeepers of the internet – will be subject to more stringent rules aimed at curbing their market power.

According to the Financial Times, ‘large platforms that find themselves on the list will have to comply with tougher regulation than smaller competitors, including new rules that will force them to share data with rivals and an obligation to be more transparent on how they gather information.

The list will be compiled based on a number of criteria, including market share of revenues and number of users, meaning the likes of Facebook and Google are likely to be included. Those deemed to be so powerful that rivals cannot trade without using their platforms could also be added’.

1. Under the new competition rules will the EU also seek to address structural problems by breaking up Big Tech, or by forcing companies to sell off businesses if they are found to be behaving to the detriment of their rivals?

2. Under current competition rules the Commission can already impose structural remedies, such as for example separating a dominant search engine with over 93 % of market share in most EU Member States from its services. What will change with the new rules?

3. Given the fast pace of development in the digital sector, when will the Commission come forward with the new competition rules?”

On 29 January 2021, Executive Vice-President Vestager responded on behalf of the European Commission stating: “On 15 December 2020, the Commission adopted a proposal for a Digital Markets Act. The proposal — adopted at the same time as the proposal for a Digital Services Act — seeks to address the negative consequences arising from platforms acting as digital ‘gatekeepers’ to the internal market. These are large companies that have a significant impact on the internal market, serve as an important gateway for business users to reach their customers, and which enjoy, or will foreseeably enjoy, an entrenched and durable position.

The proposed Regulation sets out harmonised rules addressing practices by gatekeepers that limit the contestability of core platform services or are unfair vis-à-vis their business users. Designated gatekeepers have to ensure compliance with the obligations of the proposed Regulation within six months after one or more of the core platform services they provide have been identified as fulfilling the thresholds of the proposed Regulation.

To ensure the effectiveness of the rules, the proposed Regulation foresees the possibility of sanctions for non-compliance with the obligations, including fines of up to 10% of the company’s worldwide turnover. In case of systematic non-compliance, the Commission can impose additional behavioural or structural remedies to the extent that they are necessary to ensure compliance and proportionate to the infringement. Moreover, to keep the rules future-proof, the Commission will have the possibility to carry out market investigations to examine whether new services in the digital sector should be added to the list of core platform services or to detect new practices by gatekeeper platforms that are not effectively addressed by the proposed Regulation.”


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