European Union finalizes Digital Markets Act rules

On March 24, European Parliament and Council negotiators agreed to new European Union rules to limit the market power of big online platforms. The Digital Markets Act (DMA) will blacklist certain practices used by large platforms acting as “gatekeepers” and enable the European Commission to carry out market investigations and sanction non-compliant behaviour. The text provisionally agreed by Parliament and Council negotiators targets large companies providing so-called “core platform services” most prone to unfair business practices, such as social networks or search engines, with a market capitalisation of at least 75 billion euro or an annual turnover of 7.5 billion. Demands for tech companies under the Digital Markets Act include interoperability, the right to uninstall services, greater data access, advertising transparency, and an end to self-preferencing. If a gatekeeper does not comply with the rules, the Commission can impose fines of up to 10 percent of its total worldwide turnover in the preceding financial year, and 20 percent in case of repeated infringements. After the legal text is finalised at technical level and checked by lawyer-linguists, it will need to be approved by both Parliament and Council. Once this process is completed, it will come into force 20 days after its publication in the EU Official Journal and the rules will apply six months after.