Thursday, June 24, 2021
In December 2020, the Digital Markets Act (“DMA”) was proposed. It was prepared by the European Commission (“EC”) following several years of work. The DMA attempts to improve “fairness” and contestability” in the digital sector. The DMA acknowledges that some companies designated as “gatekeepers” maintain power over “core platform services” by virtue of incumbency advantages or bad business behavior. The DMA additionally worries about an extension of gatekeepers control over “ancillary services”, and of incipient gatekeeping positions resulting from tipping effects. The DMA states that it is built on “strong evidence” of high concentration, trading partner dependence, and unfair conduct. The DMA foresees that targeted regulation of gatekeepers’ behavior will promote the emergence of alternative platforms, improve innovation levels, and drive prices down in the digital sector. The DMA covers eight types of core platform services: online intermediation services (including software application stores), online search engines, social networking, video sharing platform services, number independent interpersonal electronic communications services, operating systems, cloud services, and advertising services. This paper gives an overview of the DMA. It does so by describing the DMA’s general characteristics (I), the “gatekeeping” market situations it targets (II), the legal treatment of gatekeeping (III), the multi-level governance system (IV), and the choice of economic policy it articulates (V). The paper concludes by highlighting areas for further consideration by lawmakers (VI). The ambition of the paper is essentially descriptive.