EU officials agree on sweeping new rules targeting Big Tech

The proposed framework, known as the Digital Markets Act, could label big companies such as Meta or Google, Facebook’s parent company, “gatekeepers” and subject them to new requirements and prohibitions.

For example, under the DMA, tech giants would be required to open access to their platforms to third parties and would be prohibited from prioritizing their own products and services over those of competing vendors. Platforms would not be able to push users to certain apps or products simply by pre-installing them on devices and setting them as default. And app stores should allow third-party payment systems, rather than requiring app developers to use the platform owner’s systems.

During negotiations on Thursday evening, European lawmakers also agreed that major online messaging services such as WhatsApp and iMessage will need to be compatible with other messaging providers. The change could allow users to send messages across different platforms – a major departure from how these services currently work.

According to a statement, repeated violations of the DMA could result in fines of up to 20% of a company’s global revenue.
The new rules have yet to be finalized. But they are expected to come into force in October, Margrethe Vestager, executive vice-president of the European Commission, told a news conference.
“Large access control platforms have blocked businesses and consumers from reaping the benefits of competitive digital marketplaces,” Vestager said in a statement. “Guardians will now have to comply with a well-defined set of obligations and prohibitions. This regulation, together with strict competition law enforcement, will bring a fairer level playing field to consumers and businesses for many digital services in the whole EU.”

Service providers subject to the law must comply with its requirements within six months of their designation as gatekeeper.

To be considered a gatekeeper, a platform must be a “basic platform service”, such as a social media or search engine provider, or an app store or digital marketplace operator . The category also covers web browsers, voice assistants and cloud services, according to a statement. Gatekeepers should also have at least 45 million monthly users in the EU and 10,000 annual business users, and revenues within the EU of at least €7.5 billion or a market capitalization of at least 75 billion euros.

The upcoming rules have been heavily lobbied by Silicon Valley giants.

In a report, Apple (AAPL) said he was concerned that some parts of the DMA will weaken user privacy and security, “while others will prohibit us from charging for intellectual property that we invest heavily in.”
google (GOOG) said in a statement that the DMA deal will have “a significant impact.”

“While we support many of the DMA’s ambitions around consumer choice and interoperability, we remain concerned that some of the rules could reduce innovation and choice for Europeans,” Google said. “Our focus at all times will be to continue to deliver the best product experiences to our European users.”

The landmark agreement highlights the growing movement by policymakers around the world to curb tech platforms, Vestager said.

“It’s a global movement and I think it’s really good,” she said. “The more we can inspire each other to enforce the law and ensure digital markets are fair, open and contestable, the better.”

Rishi Iyengar contributed to this report.


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