The European Parliament is ready to commence negotiations with the Council of the European Union (the Council) on its proposed text for the Digital Markets Act (DMA). The DMA aims to put an end to unfair business practices by large online platforms providing core platform services in the digital sector, acting as the "gatekeepers" to the single market.
The Parliament's proposed amendments affect the definition of "gatekeeper", which can include online intermediation services, social networks, search engines, operating systems, online advertising services, cloud computing and video-sharing services, subject to the relevant criteria and thresholds being met.
The key changes approved by Parliament to the European Commission's proposal are as follows:
- increasing the quantitative thresholds so that a company is covered by the DPA to €8 billion in annual turnover in the European Economic Area, and a market capitalisation of €80 billion. The company would also require a core platform service offering in at least three EU member states and have at least 45 million monthly end users in addition to at least 10,000,000 business users;
- introducing additional rules around the use of data for targeted advertising and interoperability of services;
- giving users the option to uninstall pre-installed software on a core platform;
- introducing measures seeking to combat "killer acquisitions", such as restricting gatekeepers from making acquisitions in areas relevant to the DMA to prevent damage to the internal market, and requiring gatekeepers to inform the European Commission of any intended "concentration";
- providing clarification around the role of national competition authorities;
- ensuring whistleblowers are able to alert the relevant authorities to suspected infringements and protecting them from retaliation; and
- establishing the European Commission's power to impose fines of not less than 4% and not exceeding 20% of total worldwide turnover (for the preceding financial year) for non-compliance.
The proposed text is the Parliament's mandate for negotiations with EU governments, which will commence in early 2022 under the French presidency of the Council.
For further information on this topic please contact Lauren Pettit, Lizzie Charlton or Paula Barrett at Eversheds Sutherland by telephone (+44 20 7919 4500) or email ([email protected], [email protected] or [email protected]). The Eversheds Sutherland website can be accessed at www.eversheds-sutherland.com.