European tech companies and industry groups have demanded better communication from tech “gatekeepers” ahead of the introduction of the EU’s Digital Markets Act (DMA).
An open letter from tech companies including VPN firm Proton and search engine Qwant, as well as industry bodies including the European Tech Alliance, said that the thousands of businesses they represent were worried about a lack of "effective" engagement from the companies that have been designated gatekeepers under the DMA.
“Gatekeepers have either failed to engage in a dialogue with third parties or have presented solutions failing short of compliance with the DMA,” the letter said.
“Businesses and consumers are largely kept in the dark as to what is going to happen after 7 March 2024,” the letter said.
In September 2023, the European Commission said that Google’s parent company Alphabet, along with Amazon, Apple, ByteDance, Meta, and Microsoft were considered ‘gatekeepers’ under the DMA.
Under the terms of the legislation, the European Commission can designate companies as gatekeepers if they provide a key ‘gateway’ between businesses and consumers through their core platform services.
In this case, the EC said it counted 22 core platform services in total across the six gatekeepers in areas including search, social networks, browsers, operating systems, and video sharing.
The new rules establish new obligations for gatekeepers, which have six months to ensure compliance for each of their core platforms. That means they have until 7 March to get ready.
How the Digital Markets Act will work
For example, in some situations, they may have to allow third parties to interoperate with their own services, enable business users to access the data they generate by using the gatekeeper’s platform, and provide companies advertising on their platform with tools to carry out their own independent verification of their ads.
Gatekeepers will also be forced to allow businesses to promote their offers and make deals with customers outside the gatekeeper’s platform.
According to the EC, gatekeeper platforms can no longer treat their own services and products more favorably in ranking, or prevent consumers from linking up to businesses outside their platforms.
They also can’t stop users from uninstalling any pre-installed software or app, or track end users outside of the gatekeepers' core platform service for advertising without their explicit consent.
The consequences of non-compliance can be painful for these gatekeepers, including fines of up to 10% of the company’s total worldwide annual turnover, or up to 20% in the event of repeated infringements.
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In their letter, the European tech firms and industry groups said the DMA will affect how millions of consumers and business users interact with social networks, app stores, online shopping, video sharing services, and more.
“It will constitute a paradigm shift in digital markets, with one fundamental objective: the creation of fair and contestable digital markets in Europe,” the letter reads. “It should put an end to anticompetitive practices that led to higher prices for consumers and slowed innovation in Europe.”
The launch of the Digital Markets Act in March 2024 will mark the “beginning of the new era”, the consortium said, and one that will improve competition for smaller businesses across the union.
“It would be regrettable if that new era began with a false start, which will happen if the gatekeepers do not constructively engage with third parties, including business users and consumer associations, before 7 March on how they intend to comply with the DMA,” it said.
The letter said the gatekeepers should engage “as soon as possible” with businesses and others in a constructive dialogue and make "swift progress on their proposed compliance solutions".
