European rules for digital platforms
There are new European rules for the largest digital platforms. These are laid down in the Digital Markets Acts (DMA). The new rules offer more protection for businesses and consumers using the platforms. Read what this means for entrepreneurs.
What is the Digital Markets Act (DMA)?
The Digital Markets Act (DMA) is a European law. The purpose of the law is to protect entrepreneurs and consumers. And to ensure more competition in digital markets. The DMA's rules apply to the largest digital platforms. These are the 10 to 15 largest online platforms worldwide, which entrepreneurs and consumers can hardly ignore. These platforms can help you reach many customers for your products or services. As a result, you may not be able to continue without these platforms. These platforms are called gatekeepers.
What is a gatekeeper?
A platform is a gatekeeper when it meets these 3 conditions:
- It has a strong position in the European single market.
- It provides a core platform service (such as a search engine, video platform, app store, web browser, operating system, online advertising service, or social network).
- It has had a strong position in the market for a longer period.
The European Commission decides which platforms meet these 3 conditions. There are 2 ways to decide: based on numbers or on research. For example, the European Commission looks at market value or turnover. And at the number of users and the amount of data that a platform has. The European Commission also takes into account how long the platform has had the market value or number of users. Gatekeepers will then have 6 months to comply with the DMA rules.
Why is the Digital Markets Act necessary?
Entrepreneurs and consumers increasingly depend on large platforms. For example, to sell or buy products. Platforms can take advantage of that situation. And demand unfair terms and conditions. This makes it harder for you to compete with these large platforms. With the DMA, platforms have less power and entrepreneurs and consumers are better protected.
What will the Digital Markets Act mean for you?
There are several rules that gatekeepers will have to abide by that improve your position. This will help you as it ensures a fair digital market. You will have better opportunities with your business.
Some examples of what gatekeepers will be required to do:
- Offer fair terms to entrepreneurs when they offer apps in the app store.
- Give entrepreneurs free access to their own (customer) data upon request.
- Give entrepreneurs access to data on how their ads are performing on the platform.
- Ensure that, for example, entrepreneurs’ apps and payment services can connect and interact (interoperate) with the gatekeeper’s operating system and hardware.
Some examples of what gatekeepers are not allowed to do:
- Forbid entrepreneurs to offer products or services on their own website or on other platforms at a lower price. Or with better terms and conditions. This is also called a parity clause.
- Prefer or treat their own products and services better than similar products or services of entrepreneurs in search results.
- Require entrepreneurs to use certain additional services, such as using the gatekeeper’s payment service for app purchases.
- Collect entrepreneurs’ data from one service and using that data on another service in competition with the entrepreneur. For example, with digital ads.
- Stop entrepreneurs from communicating with customers outside the app store and offering subscriptions.
Enforcing the Digital Markets Act
The European Commission will monitor whether platforms comply with the DMA. The European Commission makes all key decisions about the gatekeepers and can impose fines. It can also take additional measures if platforms repeatedly fail to comply. National authorities cooperate with the European Commission by monitoring DMA compliance. In the Netherlands, this is the Consumer & Market Authority (ACM).
At the moment, the ACM cannot investigate complaints itself. It can only pass on complaints to the European Commission. A proposal for a new national law will soon go to the Upper and Lower Houses of Parliament. Once the proposal is approved, the ACM can start its own investigations for the DMA. This is expected to take place during 2024.
Complaints about platforms
Do you have a complaint about a digital platform (gatekeeper)? If so, you can report it to the European Commission and the ACM. You can use ACM's tip-off form for this purpose. The European Commission uses these complaints to enforce the DMA.
More rules for digital markets
There are more and more rules for digital markets that are important for entrepreneurs. Below are other rules that might (start to) be important for you:
The Digital Services Act (DSA) has rules on the liability and responsibility of online intermediary services (such as internet providers and online platforms). These rules apply across the European Union. The law entered into effect on 17 February 2024. Large platforms already had to comply with the rules since the end of August 2023.
The Data Governance Act (DGA) consists of rules for governments to share data in a trusted manner. This is done through data mediation services. This is a neutral intermediary that enables data sharing.
The Data Act wants to encourage the use of data. And ensure that revenue from data is shared more fairly among parties participating in the data economy.
The AI Act aims to ensure that AI systems used in the European Union are safe. And that they respect the rights and values of the European Union.
The Platform-to-business regulation protects entrepreneurs when doing business with platforms. These rules require platforms to give entrepreneurs information. For example, how search results are ranked on a platform.
Questions relating to this article?
Please contact theMinistry of Economic Affairs and Climate Policy, EZK