What is the Digital Markets act (EU Reg. 1925/2022) the EU regulation that will disrupt the market for digital services.

The European Union, by means of the European Parliament and the Council at the proposal of the European Commission, issued the Digital Markets Act (EU Regulation 1925/2022), through this regulation the EU wants to protect and ensure the proper functioning of the market Community.

The Union identifies two categories of weak persons who are considered worthy of protection: the business user, which produces and sells digital services on online platforms, and the end user which is the consumer, who buys and is the direct recipient of the services offered by entrepreneurs.

The legislation under comment aims to supplement the articles 101 and 102 TFEU with regard to competition. The first rule prohibits all agreements between undertakings capable of restricting or distorting competition, which are considered void in law (e.g. cartels); secondly, Article 102 TFEU prohibits the abuse of a dominant position by undertakings. The rule in question does not prevent the possession of a dominant position on the market, but its exercise in an abusive manner as conduct liable to hinder free competition on the market.

Thus, as stated in recital (11) of the regulation, the aim is to ensure that markets in which companies with a strong economic position are present are equi e contestable.

Definition of gatekeeper

This set of rules directly affects the so-called ''Big tech'' which, according to the Union bodies, have a strong economic position on the market, which are defined by the Regulation as ''gatekeeper''.

In Italian gatekeeper takes on the meaning of ''guardian'' or ''sorvegliante'', this status is attributed to companies such as Apple, Google, Microsoft, Meta, Tiktok, Amazon which, according to the European Union, would control and effectively limit access to digital services markets (e.g. services provided on Apple's app store, or Google play store) by exercising a dominant economic position on them.

These companies hire a essential intermediary role between the business user and the end user, think of the case of an innovative start-up creating an application that, in order to reach consumers, has to pass through the Apple or Google market stores by paying them high commissions.

According to the Union, big tech would offer unfair conditions to both commercial enterprises and consumers by exercising control over access to digital services.

Article 3 of the DMA lays down size requirements that a company must have in order to fall within the definition of gatekeeper. In particular, the company must achieve an annual turnover in the Union of EUR 7.5 billion or more in the last three financial years or a market value of EUR 75 billion in the last financial year, must have at least 45 million active end-users on a monthly basis and at least 10,000 active business users on an annual basis.

The obligations imposed by the EU

The DMA, therefore, imposed obligations precise obligations on gatekeepers, these are laid down in Articles 5, 6, 7 and 8 of the regulation in question. These obligations range from the processing of user data to the offering of services and products by commercial users.

In particular, the most affected by the Regulation can certainly be said to be Apple as its ecosystem has always been the most closed and least allows users to customise their user experience. The company has always adopted this strategy to protect consumers as, according to it, opening up its operating system could lead to exposure to viruses and malware.

Sanctions

In case of non-compliance, Article 30 of the Regulation provides for the possibility for the Commission to impose a fine of up to 10% of the undertaking's total annual worldwide turnover or up to 20% in case of repeated infringements.

The Apple case

Let's look specifically at what Apple had to do to comply with the directive.

First, and this is a first for the Cupertino company, Apple had to give users (both business and end users) the option of installing alternative application stores to the original App Store on their devices (so-called sideloading)This measure is only allowed within the EU market.

According to the Union, Apple exerted a strong economic position as commercial users could only publish their applications on Apple's App Store, they had no alternative and even had to pay very high commissions on revenues (amounting to 30%) to Apple.

With the entry into force of the EU Digital Marketplaces Regulation, app developers will also be able to publish their apps on alternative markets. Through this measure, the EU guarantees the right to competition by allowing developers to choose where to publish their applications, perhaps choosing alternative stores with lower fees than those owed to Apple.

Secondly, Apple should not force its users to use a certain payment instrumentbut will have to allow the use of alternative instruments (think Paypal, Satispay, etc.). More precisely, the measure concerns NFC technology, Apple will have to open it up to business users and will no longer be exclusive to the 'Apple Pay' service. By NFC technology, we mean the tool that today allows us to pay conveniently in shops by placing our smartphone on the POS, in order to take advantage of credit cards issued by banks.

Finally, the Cupertino company has been obliged to give users the option of choosing the default browser; before, consumers could only download alternative browsers, but could not set them as the main means of use. To be clear, before the DMA, if the user received a link on whatsapp this was only opened on Safari, now the user is free to choose which browser to use.

Dr Francesco Laface