EU’s Digital Markets Act: Holding Big Tech Under Control and Promoting Fair Competition

New investigation proves EU’s commitment to regulating digital giants

The Digital Markets Act (DMA) was implemented in the EU last year, and its enforcement began immediately. The world’s largest digital companies, including Alphabet (Google), Meta (Facebook), and Apple, were given until March 7 to make changes to comply with the regulation. Despite their claims of compliance, the Commission remained skeptical.

On March 25, the Commission announced that it had launched an investigation into Google, Meta, and Apple for not complying with the DMA. If found guilty, potential fines could reach up to 10 percent of their global turnover. The goal is to bring these digital giants under control and ensure compliance with the new regulations.

In the past, traditional fines imposed on these companies have been ineffective in curbing their behavior. For example, the EU fined Apple 1.8 billion euros for abusing its dominant market position in music streaming apps distribution, which was a negligible amount compared to their profits. The new DMA gives EU authorities the power to issue fines of up to 10 percent of a company’s global turnover for violations, which could have a more significant impact on these tech giants.

The regulation also includes structural remedies such as forcing companies to sell certain parts of their business operations if they continue to violate rules proactively intervening in anti-competitive practices and ensuring fair competition in digital markets is achieved through this approach.

The new legislation aims to prevent dominant companies from stifling competition and innovation as seen in tech giants favoring their services over competitors. This can lead to limited choices for consumers and potentially higher prices. By taking a proactive approach and implementing strict regulations, the EU hopes level playing field in digital market preventing abuses of power by these companies.

The ongoing legal battles in US such as FTC’s lawsuit against Meta and Apple highlight challenges of regulating companies that have reached dominant market positions.

The EU’s Digital Markets Act sets a precedent for proactive market regulation and could serve as a model for other countries.

By enforcing these rules effectively, EU aims protect consumers promote fair competition prevent consolidation of power by digital giants

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