Public Consultations Begin

Digital Markets and Competition Law: The European Commission Opens Public Consultations on Potential New Regulatory Tools

Generally speaking, competition rules have an in-built flexibility that allows the authorities to address evolving issues and novel practices. However, the European Commission (“EC”) has taken the position that certain structural risks related to online platforms cannot be adequately addressed within the current regulatory framework, and has opened public consultations on exploring the need for new regulatory tools for addressing structural problems in digital markets.

The EC proposed a three-fold strategy that will put emphasis on a proactive enforcement in individual cases, the introduction of potential new tools to deal with structural problems, and additional obligations for so-called “gatekeeper” platforms. The new strategy would broaden the investigation powers of EC, as it will enable EC to target a sector and order remedies to undertakings, without establishing that the undertaking in question actually breached the law. This would enable EC to tackle certain industries where the market structure itself might raise concerns about the competitive process.

Concerning the “gatekeeper” platforms, the strategy aims to introduce a blacklist for certain kinds of behavior, such as banning of de-ranking smaller competitors of the dominant company’s service on the platforms. The actual scope of gatekeeper platforms that might fall under the regulatory regime is still in consideration, but the EC likely aims to include tech giants like Google, Facebook, and Amazon, all of which have faced significant antitrust scrutiny in a number of high-profile cases within the past few years.

The EC will be consulting stakeholders from the public and private sector, including competition authorities and government bodies, academia, as well as legal and economic practitioners. The comments and proposals on the inception impact assessment should be submitted until 30 June 2020 and response to the open public consultation can be provided until 8 September 2020 in any official EU language. Following the process, a legal proposal is expected by the end of the year, which has the potential to significantly reshape both competition law as we know it today and the digital markets across Europe.

 

*The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.