Digital Markets Act — Market Investigations

In addi­ti­on to the pro­hi­bi­ti­ons of the black­list, the Digi­tal Mar­kets Act (DMA) also con­ta­ins an inde­pen­dent instru­ment of mar­ket inves­ti­ga­ti­on. Three occa­si­ons for the initia­ti­on of a mar­ket inves­ti­ga­ti­on are pro­vi­ded for:

  • Appoint­ment of gate­kee­pers, Art. 15 DMA
  • Sys­te­ma­tic breach of obli­ga­ti­ons, Art. 16 DMA
  • Iden­ti­fi­ca­ti­on of new ser­vices and prac­ti­ces, Art. 17 DMA

Objec­ti­ve: The instru­ment of the mar­ket inves­ti­ga­ti­on is simi­lar to that of the sec­tor enquiry under car­tel law. Accor­ding to this, the com­pe­ti­ti­on aut­ho­ri­ties should be able to obtain gene­ral infor­ma­ti­on on cer­tain eco­no­mic sec­tors and iden­ti­fy pos­si­ble rest­ric­tions of competition.

Dif­fe­rence to car­tel law: A sec­tor enquiry is not direc­ted against spe­ci­fic com­pa­nies, but requi­res the sus­pi­ci­on that con­di­ti­ons exist in a cer­tain area that are not desi­ra­ble under com­pe­ti­ti­on law. The­se are initi­al­ly obvious vio­la­ti­ons of appli­ca­ble car­tel law, but other pur­po­ses may also be cover­ed, such as con­su­mer sec­tor inves­ti­ga­ti­ons in Germany.

Pro­ce­du­re: For­mal­ly, a mar­ket inves­ti­ga­ti­on accor­ding to Art. 14 DMA is initia­ted by a decis­i­on which, in addi­ti­on to the date of initia­ti­on, also con­ta­ins spe­ci­fi­ca­ti­ons on the sub­ject mat­ter and pur­po­se of the inves­ti­ga­ti­on. Howe­ver, this decis­i­on is not one of tho­se under Art. 34 para. 1 DMA that must be published. Howe­ver, if imple­men­ta­ti­on decis­i­ons are taken in mar­ket inves­ti­ga­ti­ons pur­su­ant to Art. 15 or Art. 16 DMA, the gate­kee­per or the com­pa­nies con­cer­ned must be given the oppor­tu­ni­ty to comment.

Assessment of gatekeepers

Requi­re­ments: The mate­ri­al cri­te­ria for com­pa­nies to be obli­ged under the Digi­tal Mar­kets Act are pro­vi­ded for in Art. 2 No. 1 DMA. Accor­ding to Art. 3 No. 2 DMA, a noti­fi­ca­ti­on obli­ga­ti­on for gate­kee­pers is pro­vi­ded for. In this case, the initia­ti­ve to appoint a gate­kee­per comes from the regu­la­ted com­pa­ny. The EU Com­mis­si­on exami­nes this noti­fi­ca­ti­on and, if neces­sa­ry, sub­se­quent­ly desi­gna­tes the com­pa­ny as a gate­kee­per. In addi­ti­on, the EU Com­mis­si­on draws up a list of the rele­vant cen­tral plat­form ser­vices ope­ra­ted by this company.

Start­ing point: The mar­ket inves­ti­ga­ti­on accor­ding to Art. 15 DMA pro­vi­des the EU Com­mis­si­on with the aut­ho­ri­ty to inde­pendent­ly appoint a gatekeeper:

  • Argu­ments of the com­pa­ny: On the one hand, this can be con­side­red if the com­pa­ny con­cer­ned pres­ents sub­stan­tia­ted argu­ments that it does not ful­fil the gate­kee­per criteria.
  • Own sus­pi­ci­on: On the other hand, the EU Com­mis­si­on can initia­te a mar­ket inves­ti­ga­ti­on based on inde­pen­dent suspicions.

Rele­van­ce: In doing so, it has a regu­la­to­ry dis­cre­ti­on to take action based on the pur­po­se of desi­gna­ting a gate­kee­per. In this con­text, the mar­ket inves­ti­ga­ti­on for the desi­gna­ti­on of gate­kee­pers can be of par­ti­cu­lar importance whe­re the thres­hold values spe­ci­fied in Art. 3 para. 2 DMA are not rea­ched. In this case, the EU Com­mis­si­on has the for­mal mar­ket inves­ti­ga­ti­on pro­ce­du­re with which a gate­kee­per can be appoin­ted on the basis of the mate­ri­al cri­te­ria accor­ding to Art. 3 para. 1 DMA.

Sub­ject mat­ter: Howe­ver, not only the desi­gna­ti­on of the gate­kee­per, but also its cen­tral plat­form ser­vices can be the sub­ject of a mar­ket inves­ti­ga­ti­on. Thus, the desi­gna­ti­on as gate­kee­per could be made on the basis of a noti­fi­ca­ti­on, but the fur­ther desi­gna­ti­on of the core plat­form ser­vices only sub­se­quent­ly on the basis of a mar­ket investigation.

Time­line: This mar­ket inves­ti­ga­ti­on should be com­ple­ted within twel­ve months. After six months, the EU Com­mis­si­on shall send a preli­mi­na­ry assess­ment to the ope­ra­tor of the exami­ned cen­tral plat­form ser­vices. If the mar­ket inves­ti­ga­ti­on is car­ri­ed out on the basis of Art. 3 para. 4 DMA, i.e. becau­se the ope­ra­tor of cen­tral plat­form ser­vices pres­ents sub­stan­tia­ted argu­ments against its gate­kee­per posi­ti­on despi­te rea­ching the thres­holds, then the mar­ket inves­ti­ga­ti­on is to be com­ple­ted within five months. A noti­fi­ca­ti­on of the preli­mi­na­ry assess­ment is to be made after only three months.

Right to appeal: In prin­ci­ple, affec­ted com­pa­nies can appeal against indi­vi­du­al inves­ti­ga­ti­ve mea­su­res. On the other hand, legal pro­tec­tion against the basic initia­ti­on of a mar­ket inves­ti­ga­ti­on is gene­ral­ly ruled out becau­se of the broad dis­cre­tio­na­ry powers. Howe­ver, objec­tions can pro­ba­b­ly be rai­sed on the grounds that a gate­kee­per posi­ti­on is obvious­ly absurd or arbitrary.

Soon-to-be gate­kee­pers: A spe­cial situa­ti­on ari­ses for desi­gna­ted gate­kee­pers whe­re the estab­lished and per­ma­nent posi­ti­on accor­ding to Artic­le 3 para. 1 lit. c DMA‑E is only fore­seeable and does not yet exist (“soon-to-be” gate­kee­pers). A gate­kee­per can also be appoin­ted in the case of this fore­seea­bi­li­ty. Howe­ver, accor­ding to Art. 15 para. 4 DMA‑E, it is then pos­si­ble to decla­re only cer­tain gate­kee­per obli­ga­ti­ons appli­ca­ble. The­se are:

  • Art. 5 lit. b DMA: Pro­hi­bi­ti­on of most-favou­red-nati­on tre­at­ment vis-à-vis other online inter­me­dia­ry services.
  • Art. 6 para. 1 lit. e DMA: Pro­hi­bi­ti­on of tech­ni­cal rest­ric­tions on software/​service chan­ges or fur­ther subscriptions
  • Art. 6 para. 1 lit. f DMA: Access/​interoperability with ancil­la­ry ser­vices used to ope­ra­ting sys­tems and hardware/​software functions
  • Art. 6 para. 1 lit. h DMA: Effec­ti­ve data por­ta­bi­li­ty, also with regard to com­mer­cial users; pro­vi­si­on of tools to faci­li­ta­te data trans­fer in accordance with the GDPR; gua­ran­tee of per­ma­nent real-time access.
  • Art. 6 para. 1 lit. i DMA: Free effec­ti­ve, high qua­li­ty and per­ma­nent real-time access to use aggre­ga­ted or non-aggre­ga­ted data ari­sing in con­nec­tion with the use of this cen­tral plat­form ser­vice; enab­ling access/​use of per­so­nal data only to the ext­ent rela­ted to end-user use and pro­vi­ded con­sent is given under the GDPR.

Reasona­bi­li­ty: The­se obli­ga­ti­ons must be lis­ted in the desi­gna­ti­on decis­i­on. The EU Com­mis­si­on is bound by the prin­ci­ple of pro­por­tio­na­li­ty. This also means that impo­sing obli­ga­ti­ons on “soon-to-be” gate­kee­pers can only be con­side­red in the cir­cum­s­tances of the indi­vi­du­al case and is other­wi­se excluded.

Review: Accor­ding to Art. 4 DMA, the EU Com­mis­si­on must regu­lar­ly review the gate­kee­per sta­tus. In the cour­se of the­se reviews, it may impo­se fur­ther obli­ga­ti­ons on com­pa­nies alre­a­dy desi­gna­ted as gate­kee­pers wit­hout fur­ther mar­ket investigation.

Systematic breaches of obligations

Pre­re­qui­si­tes: The mar­ket inves­ti­ga­ti­on accor­ding to Art 16 DMA is direc­ted at the con­duct of a gate­kee­per. Sys­te­ma­tic brea­ches of the obli­ga­ti­ons under Art. 5 and 6 DMA are to be inves­ti­ga­ted, by means of which the gate­kee­per’s posi­ti­on is streng­the­ned or exten­ded. This means that it is not only the inf­rin­ge­ments that mat­ter, but also the com­pe­ti­ti­ve effect. The EU Com­mis­si­on would the­r­e­fo­re also have to make fin­dings on the ext­ent to which vio­la­ti­ons of the desi­gna­ted obli­ga­ti­ons also led to the struc­tu­ral chan­ges in favour of the plat­form. Legal presumption:

  • For streng­thening or expan­si­on: Accor­ding to Art. 16 para. 4 DMA, this streng­thening or expan­si­on is pre­su­med if the requi­re­ments of Art. 3 para. 1 DMA have increased. The thres­hold values of Art. 3 para. 2 DMA are not rele­vant for this. The deter­mi­na­ti­on cri­te­ria as such may, howe­ver, be used to estab­lish accretion.
  • For sys­te­ma­tic non-com­pli­ance: Art. 16 para. 3 DMA con­ta­ins a pre­sump­ti­on of sys­te­ma­tic non-com­pli­ance if the­re have been at least three inf­rin­ge­ment pro­cee­dings within five years pri­or to the initia­ti­on decision.

Cri­ter­ion: The EU Com­mis­si­on reta­ins the lee­way to inde­pendent­ly deter­mi­ne sys­te­ma­tic vio­la­ti­ons. A sys­te­ma­tic approach is sup­port­ed by num­e­rous indi­vi­du­al inf­rin­ge­ments against num­e­rous affec­ted par­ties, which give rise to a sub­stan­ti­al fear that the pur­po­se of the pro­vi­si­on can no lon­ger be fulfilled.

Time­line: Inves­ti­ga­ti­ons are to be con­cluded twel­ve months after the initia­ti­on of the mar­ket inves­ti­ga­ti­on. Within six months of the initia­ti­on of the inves­ti­ga­ti­on, the EU Com­mis­si­on must com­mu­ni­ca­te its objec­tions, preli­mi­na­ry assess­ments and pos­si­ble reme­dies. Pur­su­ant to Art. 16 para. 6 DMA, the EU Com­mis­si­on may reason­ab­ly extend the inves­ti­ga­ti­on with objec­ti­ve justification.

Mea­su­res: The EU Com­mis­si­on may take any pro­por­tio­na­te beha­viou­ral or struc­tu­ral reme­di­al mea­su­res to con­clude the pro­ce­du­re. Howe­ver, accor­ding to Art. 16 para. 2 DMA, the­se are only con­side­red if no beha­viou­ral mea­su­re can be con­side­red, for exam­p­le becau­se this would be more bur­den­so­me for the gate­kee­per. Pur­su­ant to Art. 16 para. 6 sen­tence 3 DMA, the­re is the pos­si­bi­li­ty of issuing decla­ra­ti­ons of com­mit­ment, which the EU Com­mis­si­on can decla­re binding.

Identification of new services and practices

The third occa­si­on ser­ves the pur­po­se of pro­vi­ding the EU Com­mis­si­on with gene­ral infor­ma­ti­on on the com­pe­ti­ti­ve situa­ti­on. Occa­si­ons here can be:

  1. New core plat­form ser­vice: the addi­ti­on of a digi­tal sec­tor ser­vice to the list of core plat­form services.
  2. New prac­ti­ces: Detec­tion of prac­ti­ces not effec­tively pre­ven­ted by this Regulation.

New cen­tral plat­form ser­vice: the first reason is to crea­te a gene­ral pos­si­bi­li­ty to expand the ser­vices sub­ject to regu­la­ti­on. Due to the sti­pu­la­ti­ons on the initia­ti­on of the mar­ket inves­ti­ga­ti­on, the EU Com­mis­si­on would not be able to desi­gna­te new ser­vices as cen­tral plat­form ser­vices of a spe­ci­fic gate­kee­per accor­ding to Art. 3 para. 7 DMA. This would requi­re a fur­ther step of the mar­ket inves­ti­ga­ti­on to desi­gna­te the gate­kee­per or its core plat­form services.

New prac­ti­ces: In addi­ti­on, the EU Com­mis­si­on is given an inde­pen­dent report­ing opti­on by means of which it can pre­sent gaps in the pur­po­se of the regu­la­ti­on. It can descri­be prac­ti­ces by means of which the con­te­st­a­bi­li­ty of cen­tral plat­form ser­vices can be limi­t­ed. It is not a mat­ter of estab­li­shing effec­ti­ve­ness, but only the pos­si­bi­li­ty of rest­ric­tion. Denia­bi­li­ty is also lin­ked to the pur­po­se of com­pe­ti­ti­on poli­cy and not gene­ral­ly to com­pe­ti­ti­on as a pro­tec­ted good. This mar­ket inves­ti­ga­ti­on thus has a very nar­row focus.

About the author

Porträtbild von Dr. Sebastian Louven

Dr. Sebastian Louven

I have been an independent lawyer since 2016 and advise mainly on antitrust law and telecommunications law. Since 2022 I am a specialist lawyer for international business law.

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