After two rounds of public consultations that ended 8 September 2020, the European Commission (‘Commission’) appears to be on track and make its proposals for new enforcement powers more concrete. The Commission intends to adopt two definitive legislative proposals before the end of 2020. In the second edition of our regular blog for Kluwer, we take a look at where the Commission stands in shaping its proposals, and where it might be heading.

Two pieces of legislation are in the pipeline

On the one hand, there is the Digital Services Act (DSA). The Commission aims to propose rules in respect of the responsibilities of digital service providers in order to address the risks faced by their users and to protect their rights. The second pillar of the Commission’s regulatory package is the so-called New Competition Tool (NCT). The exact contents of this potential new instrument for the Commission are still unclear, but the Commission proposed that it is given the powers to impose certain restrictive measures on digital platforms with significant market power (which in many cases will amount to a dominant position) even in the absence of (demonstrated) abusive conduct. The NCT may become part of a broader Digital Markets Act (DMA).

France and the Netherlands urge the Commission to move on

In a joint non-paper dated 15 October 2020, the French and Dutch governments plead – as input on the DSA and NCT consultations of the Commission – in favour of further regulation and provide clear advice regarding the direction they believe the Commission should take in the DSA and/or DMA. Their first recommendation is that the Commission should draw up a list with principle-based obligations and prohibited practices for gatekeeper platforms. Their second recommendation relates to case-by-case remedies. The joint governments propose that access obligations might be imposed to ensure market openness. The purpose of these measures would be to enhance competition by regulating access to relevant inputs, users, and online infrastructures. Finally, they advocate the introduction of hefty, deterring fines.

On 29 October, Martijn Snoep, chairman of the Netherlands Authority for Consumers and Markets (ACM), was quoted having said that the DMA should not lead to the creation of a new regulatory body but should instead seek to bolster and centralise regulatory oversight of big tech within an experienced authority. The proposal to adopt an ex ante code that would impose a list of ‘do’s and don’ts’ on large gatekeeper platforms will need a “strong and central” regulator that can act speedily and legitimately negotiate remedies with ‘big tech’, said Snoep.

What can Loyens & Loeff do for you?

Digital technologies present companies with many online and offline business opportunities. However, they also bring about a whole new range of tax and legal challenges, from competition and intellectual property issues, to data protection and privacy questions. Loyens & Loeff has set up a dedicated and multidisciplinary Digital Economy Team. This firm-wide team unites top experts from our various practice groups in all of our jurisdictions. This integrated and dynamic approach guarantees high-end and efficient solutions for our clients covering all relevant legal and tax aspects of their business.

Over the past few years, the competition specialists in our Digital Economy Team have represented a broad variety of technology companies, from major online platforms to smaller but innovative start-ups. In this respect we have developed an impressive track record in providing legal advice on several technology related topics, such as digital commerce, block chain, fin-tech and big data.

It is our forward thinking and practical advice that helps our clients to stay ahead in the digital world and to find solutions to any (potential) competition problems that arise. In the context of our focus on the tech sector and our aim of thought leadership, we published our handbook Digital Competition Law in Europe: A Concise Guide (Kluwer), in September 2019. This book aims to be an indispensable guide to quickly and accessibly acquiring in-depth knowledge in competition law in the digital sector, and a must-read for any practitioner or academic who encounters competition law related to digital markets. According to Kluwer, this book is ‘one of [its] most significant publications of recent years’.