General

On July 18, local time, the European Council, the highest decision-making body of the European Union, approved the Digital Markets Act. The bill would restrict certain actions by tech giants identified as "gatekeepers," enabling the European Commission to conduct market investigations and sanction them for non-compliance.

According to a statement on the European Council's official website, the European Council passed the "Digital Markets Act" on the same day, finally approving its new rules for the establishment of a fair competition in the digital industry.

According to the statement, the Digital Markets Act sets out rights and rules for large online platforms, or "gatekeepers," to ensure that none of them abuse their position. "Regulating digital markets at EU level will create a fair and competitive digital environment where companies and consumers can benefit from digital opportunities."

"Gatekeeper" companies refer to those large companies that provide "core platform services" such as social networks and search engines, with a market value of at least 75 billion euros or an annual turnover of 7.5 billion euros, and at least 45 million monthly end users in the EU , 10,000 business users per year.

The Digital Markets Act stipulates that large short messaging service platforms must be open and interoperable with smaller messaging platforms when required; relevant businesses can only use personal data for Targeted advertising; allows users to freely choose browsers, virtual assistants or search engines, etc.

According to the statement, if relevant companies violate the Digital Markets Act, they will face fines of up to 10% of their global annual turnover in the previous financial year and fines of up to 20% for re-offending. If the rules are violated at least three times within eight years, the European Commission can launch a market investigation and, if necessary, impose behavioral or structural remedies.

Foreign media analysis pointed out that the "Digital Markets Act" stipulates the obligations of large online platforms. These companies must allow business users to access the data they generate on the platform, allow them to promote their products, and conduct transactions with customers outside the platform. Tech giants such as Google, Apple, Amazon, Facebook, Microsoft will all be affected.

In order to better manage the field of digital services, the European Commission proposed two bills, the Digital Markets Act and the Digital Services Act, in December 2020. After a year of negotiations, EU member states agreed on the text of the bill last November. In March this year, the European Council and the European Parliament reached an agreement on the bill. On the 5th of this month, the European Parliament passed the Digital Markets Act and the Digital Services Act. The European Council is expected to ratify the Digital Services Act in September.