DMA: EU threatened by US giants

02, Feb - NEWS

The European Union's competition commissioner said she had warned US technology giants that they would have to strictly comply with new EU legislation on digital markets, which will come into force in two months' time.

Margrethe Vestager was in Silicon Valley, California, where she met with the heads of Apple and Google, as well as other technology sector leaders, to discuss the legislation, known by the acronym "DMA."

The EU drafted the legislation in hopes of finally getting the tech sector giants on their feet, given the slow pace of investigations and litigation over abuse of dominance.

Starting in March, new obligations and bans, accompanied by deterrent fines, will be imposed on five US groups, including Alphabet, Google's parent company, as well as Amazon, Apple, Meta, Microsoft and Chinese company ByteDance, owner of TikTok.

These six companies have been labeled "gatekeepers" because their size makes them inevitable.

"The 'gatekeepers' have already been identified and March 7 is compliance day," Margrethe Vestager said Friday after a meeting in Silicon Valley.

The DMA aims to act before misconduct has already destroyed competition and created a virtual monopoly, as the EU says has happened in the past with Facebook's takeover of Instagram and WhatsApp or Google's takeover of YouTube and Waze.

The DMA would force Apple, for example, to allow app stores other than the Apple Store on its popular iPhones and iPads.

The legislation is the subject of litigation by Meta and TikTok, among others.

"The ruling can be challenged, and we respect that," Margrethe Vestager said, while stating that these appeals would not stop the DMA from taking effect.

"Until then, I see no reason to believe that (companies) will not do their best to comply on March 7," the commissioner said.

Offending companies face fines of up to 20% of their worldwide turnover if they violate again, and even dismantling in the most serious cases.