Six major tech companies, including Alphabet, Amazon, Apple, TikTok, Meta, Microsoft, and Samsung, have met the criteria to be classified as “gatekeepers” under the European Union’s Digital Markets Act (DMA), according to EU industry chief Thierry Breton. The DMA, which came into force in November, aims to promote more competition in the tech industry and regulate large online platforms that act as gatekeepers in digital markets. Companies classified as gatekeepers are subject to certain obligations and restrictions.
To be classified as a gatekeeper, a company must meet specific requirements. Social media firms with an $82 billion market capitalization in the last financial year and a presence in at least three EU member states are considered gatekeepers. Additionally, companies with an annual turnover in Europe of at least $8.16 billion in the last three financial years, along with more than 45 million monthly active users and over 10,000 yearly active business users in the EU, are also classified as gatekeepers.
The European Commission will review the submissions made by the tech companies involved and confirm their status as gatekeepers by September 6. After this deadline, companies that fail to comply with the DMA rules will have six months to make the necessary changes. Failure to comply can result in fines of up to 10 percent of annual global turnover for DMA violations and 20 percent for repeat offenders. The European Commission also reserves the right to open a market investigation and impose further remedies for repeat violations.
Under the DMA, gatekeepers are required to allow their messaging apps to interoperate with third-party rivals and enable users to choose which apps to pre-install on their devices. They are also prohibited from favoring their own services over those of their competitors or preventing users from removing pre-installed software or apps from their systems. These provisions are expected to have a significant impact on companies like Google and Apple.
The new EU rules have received mixed reactions from the tech industry. TikTok’s owner, ByteDance, has disputed its inclusion as a gatekeeper, arguing that it falls short of the overall requirements. Booking.com expects to fall into the gatekeeper category by the end of 2023, as it missed the quantitative threshold ahead of the July 3 notification date due to the pandemic.
Apple has expressed concerns about the new law, stating that it could create privacy and security vulnerabilities for its users. However, the company may implement the required changes to its systems in Europe or other countries with similar mandates.
In response to the announcement, Meta has agreed to allow users in Europe to download apps via Facebook ads. However, critics have pointed out that the gatekeeper list does not include any European companies.
The European Commission’s efforts to regulate big tech and promote competition in the digital market demonstrate its commitment to protecting EU citizens and fostering innovation for startups and companies within the EU. The designation of gatekeepers and the enforcement of the DMA rules will reshape the tech industry and promote fair competition and user choice.
Source link
