Among other things, the new Digital Markets Act aims to introduce additional restrictions on how user data can be shared, with other guidelines that aim to reduce the overall power of Big Tech “gate-keepers”, which have consistently been accused of anti-competitive practices.
This will include “restrictions on combining personal data from different sources, mandates to allow users to install apps from third-party platforms, prohibitions on bundling services, and a prohibition on self-preferencing practices.” (Politico)
The DMA also ensures users can uninstall any app from a core platform at any point, and gives developers “fair access” to additional functionality of smartphones, such as NFC chips.
Messaging services may be also forced to open up to allow interoperability between platforms via an open API “meaning outfits such as WhatsApp, Facebook Messenger or iMessage will have to open up and interoperate with smaller messaging platforms. For group chats, this requirement will be rolled out over a period of four years.” (ibid).
The Digital Markets Act will cover platforms worth over €80 billion, or have a turnover in the EEA above €8 billion, and have at least 45 million monthly users and 10,000+ business users. the overall aim is to dampen their influence, preserve fair competition, promote more choice, and increase innovation on the internet.
Companies that fall under this definition include giants such as Apple, Google, Amazon, Meta, and Alibaba. Web browsers and and virtual assistants will also be subject to the Digital Markets Act.
Penalties for breaching the act could be up to 10% of global turnover for a first offense, and up to 20% for additional offenses.
EC Competition Commissioner Margrethe Vestager expects the Digital Markets Act to come into effect in October 2022.
Wondering how the EU has the power to do this? The bloc is justifying it’s moves under Article 114 of the Treaty on the Functioning of the European Union, which states the need for smooth operation of the single market across digital products.
