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25 March 2022
Digital Markets Act signals new era for tech enforcement
Advertising regulationInformation technology
Agreement between the European Council and the European Parliament on the provisions of the Digital Markets Act (DMA) signals a new era of enforcement against technology companies.
Why it matters
The DMA – which now needs to be formally approved by the European Parliament and the relevant ministers from member states, a process that is expected to take a further six months – seeks to pre-empt anti-competitive behaviour, on pain of significant fines (up to 10% of global turnover for the first offence), rather than investigating and unravelling such practices after the fact. The DMA puts European legislation on a closer footing to what already exists in the US and creates a template for other countries to follow.
Which platforms are affected?
The DMA targets “gatekeeper” companies, which include the so-called “Big Five” tech firms: Google, Apple, Facebook, Amazon and Microsoft. But the definition of “gatekeeper” is sufficiently broad to bring in other platforms, with Booking.com, TikTok and Alibaba among those suggested in media reports.
What it means for marketers
While much of the DMA’s provisions will be of a secondary consideration for marketers – revolving around how companies operate their platforms – the list of dos and don’ts explicitly requires that tech companies give sellers access to marketing and advertising performance data on their platforms. Tech companies cannot rank their own products or services higher than those of others and they must not reuse private data collected during a service for the purposes of another service.
“The Digital Markets Act puts an end to the ever-increasing dominance of Big Tech companies. From now on, Big Tech companies must show that they also allow for fair competition on the internet” – Andreas Schwab MEP.