EU designates six tech giants as gatekeepers under DMA law

The European Commission today designated Alphabet Inc., Amazon.com Inc., Apple Inc., ByteDance Ltd., Meta Platforms Inc. and Microsoft Corp. as gatekeepers under the European Union’s DMA legislation, making them subject to more stringent regulatory requirements.

The DMA, or Digital Markets Act, is a piece of legislation that was rolled out in the EU last year. It’s designed to prevent major tech firms from engaging in anticompetitive practices. Some parts of the DMA are designed to protect consumer privacy, while others focus on objectives such as ensuring companies don’t give their products an unfair edge over the competition.

The rules included in the DMA apply to tech firms that the EU designates as gatekeepers. After the European Parliament voted to approve the law last July, officials explained that gatekeepers are “platforms whose dominant online position make them hard for consumers to avoid.”

In the case of the six companies that were given this designation today, the DMA doesn’t apply to all their services. Instead, it covers 22 specific technologies spanning several product categories. Those technologies have been designated as “core platform services” by the EU.

In the operating system market, EU officials determined that Windows, iOS and Android qualify as core platform services. Among the major social networks, Facebook, Instagram, LinkedIn and TikTok have received the same designation. The EU’s list of core platform services also covers other internet mainstays such as Amazon’s e-commerce marketplace, Google Maps and Safari.

A handful of popular products were found to theoretically qualify as gatekeepers, but ultimately didn’t make the list. This group of products includes Gmail, Outlook.com and the Samsung Internet Browser.

The European Commission stated that “although Gmail, Outlook.com and Samsung Internet Browser meet the thresholds under the DMA to qualify as a gatekeeper, Alphabet, Microsoft and Samsung provided sufficiently justified arguments showing that these services do not qualify as gateways for the respective core platform services.”

Microsoft has argued that Bing, Edge and Microsoft Advertising likewise don’t qualify even though they meet the relevant thresholds. Apple claims that iMessage falls in the same category. To determine whether this is in fact the case, the European Commission is launching an investigation that it expects to conclude within five months.

Officials are also launching a second probe designed to determine whether iPadOS might be a core platform service. The EU believes the operating system, which ships with Apple Inc.’s iPads, may qualify even though it doesn’t meet all the relevant thresholds. The probe will conclude within a year. 

The six tech giants that have been designated as gatekeepers must make their services DMA-compliant within six months. Failure to do so can carry fines equivalent to as much as 10% of a company’s annual worldwide revenue. Repeat DMA infringements can lead to fines double that size, while “systematic” noncompliance has the potential to draw further regulatory action such as restrictions on the type of acquisitions a tech giant may make. 

“In the future, additional companies could submit notifications to the Commission under the DMA, based on their self-assessment with respect to the relevant thresholds,” the European Commission stated. “In this context, the Commission maintains constructive discussions with all relevant companies.”

Photo: Unsplash

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