In 2020, the EU Commission enacted its new digital market regulation, the Digital Markets Act (DMA), which aimed to curb the behavior of dominant digital companies. The regulation took effect last year and gave until March 7 for these companies to make changes to comply with it. However, despite claims from these companies that they had made changes, the Commission remained unconvinced.
On Monday, March 25, the Commission announced that it suspects Google, Meta (formerly Facebook), and Apple are still not acting in accordance with the regulation. An investigation has been launched, and potential fines could reach up to 10 percent of the companies’ global turnover. The goal is to bring these digital giants under control and ensure compliance with the new regulations.
The traditional fines imposed on these companies in the past have not been effective in curbing their behavior. For example, the EU fined Apple 1.8 billion euros for abusing its dominant market position in the distribution of music streaming apps, but this amount was negligible compared to the company’s profits. The new Digital Markets Act gives the 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 the rules. The authorities can now intervene proactively to prevent anti-competitive practices and ensure a fair digital market. This approach is a departure from traditional competition laws that tend to intervene after the fact.
The ongoing legal battles in the US highlight
