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Two years after substantive obligations for gatekeepers took effect, the European Commission (EC) has published its first review of the Digital Markets Act (DMA). The review assesses whether the DMA has achieved its twin goals of fairness and contestability in digital markets and what (if any) changes are required.
Concluding that the DMA remains fit for purpose and does not require revision at this stage, the EC has cited increased innovation and user choice, together with new opportunities for businesses and developers, as the regime's principal achievements.
Looking ahead, the EC has signalled that cloud services and AI will be firmly in the spotlight.
The road so far
The DMA entered into force in 2022 and became applicable on May 2, 2023. In September 2023, the EC designated the first set of gatekeepers, which then had six months from the date of designation to start to comply with the regime. The EC’s review therefore covers the two-year period since substantive obligations kicked in for the initial round of gatekeepers.
To date, the EC has designated seven gatekeepers, covering 23 core platform services.
It has opened four specification proceedings (formal proceedings to specify how the relevant gatekeeper must comply with a particular substantive obligation) and initiated seven non-compliance proceedings, of which three are concluded and four remain ongoing.
The EC’s findings
According to the EC, the DMA has driven significant behavioral change by the seven designated gatekeepers, producing a tangible positive impact on digital markets.
The EC credits the DMA with increasing interoperability, opening up previously closed ecosystems, promoting fair online search and online marketplaces, improving advertising transparency and giving users control over their data through the introduction of consent mechanisms and data portability solutions.
For businesses, the EC says that the DMA’s early positive effects can be seen in areas such as the increased use of alternative browsers as a result of choice screens, the emergence of alternative app stores and messaging services, and the leveraging of data access to launch innovative services.
The pursuit of these objectives, the EC acknowledges, has not come without cost to gatekeepers.
It recognizes that the DMA generates considerable compliance costs, but reasons that these are manageable given that the obligations apply only to very large undertakings, rather than to SMEs and start-ups. The EC considers, however, that compliance costs and administrative burdens should naturally diminish over time as gatekeepers adjust to the new regulatory landscape and move towards a culture of compliance by design.
The authority also identifies adaptation costs incurred by end users, who may experience friction as a result of changes such as the introduction of new choice screens. However, it considers these costs to be temporary, as users gradually adjust to the revised interfaces.
No substantive changes—yet
On this basis, the EC concludes that the DMA is currently fit for purpose. The authority is not proposing legislative change at this stage.
That said, targeted amendments may follow in due course.
For example, the EC is considering improvements to procedural aspects of the regime and enhanced transparency. This includes possible adjustments to gatekeepers’ compliance templates and the publication of guidelines on the interplay between the DMA and the GDPR.
Spotlight on cloud services and AI
The review pinpoints cloud services and AI as key focus areas for the EC going forward. In fact, the authority is already taking action on both fronts.
In cloud services, the EC has launched designation investigations and is assessing whether changes to existing obligations are needed.
In AI, specification proceedings are in progress, and the EC is monitoring compliance—including the deployment of AI tools within designated core platform services—and evaluating whether targeted modifications to the DMA are required.
The path ahead
Overall, and particularly due to the short time it has been in effect, the EC concludes that the DMA has “not yet reached its full potential” in achieving the objectives of the regime.
To realize this potential, the authority says it will continue its work through intensive regulatory dialogue with gatekeepers and third parties. Where needed, it will rigorously enforce the regime.
But that is not all. Alongside the DMA, the EC remains committed to scrutinizing digital markets under antitrust rules. Top EC officials have emphasized the utility of antitrust investigations to police conduct that does not fall within the DMA’s scope, including novel practices in new markets.
Looking ahead, the EC is likely to continue to face political pressure from the U.S. over enforcement action against American companies. At the same time, the appointment of a new director-general for competition will be pivotal in shaping the nature of any future EC action in digital markets. How this all plays out in practice over the coming months will be closely watched.
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