The European Union Competition Chief Margrethe Vestager has compelled the giant tech to change their behaviors online, aiming to ensure an advanced level of competition in the Europe Digital Market.
Belgium (Brussels Morning Newspaper), The European Union is all set for the big tech to change behaviors online, as EU competition Chief, Margrethe Vestager, right a day before new law implementation.
In an interview, Margrethe Vestager said she did not expect full compliance right away with the milestone Digital Markets Act (DMA)—but that Brussels would not shy away from tougher action if necessary. “If you look at our history, we have sort of made it credible that we will use the tools that we have,” Vestager said.
The initiative is a fragment of the ‘Digital Markets Act’ which strives to discuss the economic power of digital giants and stop them from misusing their market power that could harm consumers in the long run. The regulation will force six “gatekeeper” companies—Google’s Alphabet, Amazon, Apple, TikTok parent ByteDance, Meta, and Microsoft—to follow a list of do’s and don’ts from Thursday.
European users should see a raft of changes including choice screens on their devices that offer more picks for web browsers and search engines. “What we need right here from gatekeepers… is changing behavior,” Vestager, who is also commission executive vice president.
The new reforms give the EU’s powerful regulator the European Commission, will allow the authority to put heavier fines on these tech giants, and can even break up companies. It can also qualify companies as gatekeepers, to update dynamically the obligations for gatekeepers when necessary design remedies, and to tackle systematic infringements of the Digital Markets Act rules, according to a press release released by the EU Commission.
“We will see some compliance, full compliance by some companies. But I do think that there will be non-compliance cases,” Vestager added.
The competition commissioner pointed towards a series of cases prosecuted against tech companies since 2014, to prove her point that Brussels means business. On Monday, the EU charged Apple company a heavy fine of 1.8-billion-euro ($1.9 billion) for preventing consumers from accessing alternative cheaper music streaming subscriptions.
“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” EU antitrust chief Margrethe Vestager said in a statement. “They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem. This is illegal under EU antitrust rules.” However Apple openly criticized the EU Commission for failing to ‘uncover evidence.’
But, today speaking in an interview, she insisted, “We’re not in this in order to break up companies, we’re not in this to give you a hefty fine. We’re in here to push for compliance.” She refused to comment on Apple, said “The courts will decide, and that will also guide our actions for the future.”
Vestager said Brussels had at its disposal not just the new law but all the antitrust tools used in previous individual cases against companies. “So, if creativity in illegal behavior increases as well, then we have all the tools, even if the DMA would not catch it,” she stressed.
The new rules were ultimately about giving users more choice, Vestager said. With all eyes on what happens after Thursday, she said one big question was how the rules would affect app stores.
What is Digital Markets Act (DAM)?
The Digital Markets Act (DAM) covers various sectors of regulation aiming to regulate the behaviors of ‘Giant tech’ companies within Europe preventing them from exploiting consumers with their economic powers and ensuring a fair-level competition among the online platforms in the digital parties.
These criteria will be met if a company:
- has a strong economic position, significant impact on the internal market, and is active in multiple EU countries
- has a strong intermediation position, meaning that it links a large user base to a large number of businesses
- has (or is about to have) an entrenched and durable position in the market, meaning that it is stable over time if the company met the two criteria above in each of the last three financial years
Any company that violates this regulation has to pay a fine of up to 10% of the company’s total worldwide annual turnover, or up to 20% in the event of repeated infringements. The sweeping act is going to come into force on Thursday.
