The European Union will introduce the new Digital Markets Act (DMA) in spring 2023: the first of two major new pieces of legislation aimed at limiting the power of high technology.
European Commission Executive Vice President Margrethe Vestager said the EU could start taking action against companies that break the new law soon after the regulation enters into force.
“The DMA will take effect next spring and we are preparing to implement it as soon as the first notifications arrive,” she said. said in a speech at the conference of the International Competition Network in Berlin.
The EU reached a political agreement on the DMA “just a few weeks ago” – back in March. The regulation will target technology companies known as “gatekeepers”: companies worth more than € 75 billion (£ 63 billion), with at least € 7.5 billion (£ 6.3 billion) in annual sales and 45 million monthly users in the EU.
Although the pace of adoption is encouraging, there were concerns that the Commission is not ready for its new enforcement role – a role that will see it assess whether custodians adhere to complex, detailed provisions in the DMA.
Addressing these concerns, Vestager said: “This next chapter is exciting. This means very specific preparation. It is a matter of creating new structures within the Commission, pooling resources from DG Company [Directorate-General for Competition] and Cnect [Directorate-General for Communications] based on relevant experience. It’s about hiring staff. It is about preparing IT systems. We are talking about the preparation of additional legal texts on notification procedures or forms. Our teams are currently busy with all these preparations and we are looking forward to coming up with the new structures very soon. “
The DMA was originally expected to take effect this year. The new longer lead time will give more time for these basic preparations, although there will probably be criticism that it allows Big Tech to get away with breaking the entry rules for longer than necessary.
The law allows goalkeepers to declare a three-month period to the Commission and up to two additional months for the EU to confirm the appointment – so there will still be several months after the DMA enters into force before any implementation is implemented. submitted (and will the flexibility of centralized Big Tech find a way around circumvention in the meantime? – Ed.).
Bernd Meiring, a partner at Antirust & Foreign Investment Practice at Linklaters, said:
“The DMA has gone through the legislative process at a record pace. The practical question is how quickly we will see its effects on digital markets. It is likely that only goalkeepers need to formally comply with DMA obligations as early as Q1 2024. There will undoubtedly be controversy over the scope of some of the broader obligations. But the formal acceptance is beginning, and now we need to start seeing what DMA means for different business models, as goalkeepers, their contractors and the Commission work out what the obligations are in practice. “
“Of course, this is an evolving story,” Vestager continued in his speech. “With the Digital Markets Act, the Commission may be a little ahead for now, but we are all moving in the same direction. Other major jurisdictions are already adopting digital regulations. South Korea recently passed legislation for app stores. Other jurisdictions are considering new digital regulations. And here in Europe, Germany adopted its own digital regulation last year. “
In particular, and in a surprising demonstration of unity, the United Kingdom has taken its own steps to align with the DMA today – announcing new powers for the Digital Markets Division, part of the regulator, the Competition Authority and markets.