Is it time for European technology companies to shine?  – The recently adopted EU digital market regulation is a severe blow to American competitors

The regulatory proposal for the digital market presented by the European Commission in December 2020 was blessed by the European Parliament and the European Council on Thursday night.

The Digital Markets Act is intended to limit the monopolistic tendencies of U.S. technology giants in particular. The provision will enter into force in October.

“Large gateway platforms have prevented businesses and consumers from reaping the benefits of a competitive digital marketplace. Now gatekeepers have to comply with well-defined obligations and prohibitions “, European Commissioner for Digital Capability Margrethe Vestager in the Commission communication.

For the world ‘s leading technological waste, such as Alphabetille, Amazon and metals, digital market regulation is a tough blow. Its policies are also tighter than expected, the Financial Times points out.

As a result of the violation, the company could be fined up to 10 percent of its worldwide revenue. The fine can increase to 20% of revenue if the violations are repeated.

Techno giants call for safety

Among the technology giants, the decision has provoked outrage. Apple according to it, the new regulation “will create unnecessary privacy and security risks for consumers while others prohibit us from charging intellectual property rights in which we invest heavily”.

“We are concerned that some of these rules could reduce innovation and European choice,” commented on Google.

Despite Google’s statement, the European Commission underlines that gatekeepers have greater opportunities to innovate and provide new services. The purpose of the regulation is to prohibit unfair practices against business users and other customers who depend on the services of gatekeepers.

“The security argument has always been, and will always be, the argument of dominant companies to limit innovation and competition,” Cédric O points out to France Télécom.

“Increasing competition is driving more innovation and this is going to happen. This is very good news for European innovators and startups. ”

O, who was actively involved in drafting the regulation, describes the digital market regulation as “historic” in Le Monde. According to him, this is “one of the most important regulations affecting the economy in recent decades.”

O also emphasizes that the adoption of the regulation was the president Emmanuel Macronin priorities. Along with the crisis in Ukraine, Macron, which has sought to emphasize its diplomatic visibility, is also currently fighting for the popularity of its own people under the forthcoming presidential election.

New opportunities for European technology companies?

The objectives of the provision include providing new and better opportunities for European startups to compete and innovate.

The impact of digital market regulation on the development of European technology companies is weighed in, among others, The Economist, which says that generating tech stars is now easier than ever.

Syrrey University Annabelle Gawerin according to, demand for digital services is growing in Europe and companies in the industry are now accumulating a lot of money, experienced entrepreneurs and startup-friendly rules.

Financial technology is by far the most successful of the European technology sectors: at the turn of the year, the combined market value of European companies was estimated at around EUR 300 billion.

The sector with the second largest market value, on the other hand, consists of digital marketplaces, valued at around € 100 billion.

By country, the European technology field is still led by the United Kingdom, followed by Germany, Sweden, the Netherlands, Denmark and France. Finland is seventh on the list.

“Lobbying did not benefit at all”

Under the new rules, in addition to fines, the European Commission may impose structural remedies on companies, such as a ban on major acquisitions, in addition to fines. In the worst case, it may require the company to be dissolved.

“We are serious about this common effort: no company in the world can turn a blind eye to the threat of a fine of up to 20%,” EU Internal Market Commissioner Thierry Breton line.

“Gafam’s lobbying efforts didn’t benefit anything at all,” Breton also said at a news conference, according to Le Monde, referring to the digital market giants Google (Alphabet), Amazon, Meta (Facebook), Apple and Microsoftiin.

According to a report published in 2021, digital giants have spent € 97 million a year in lobbying in Brussels from 2019 onwards. Of these, the largest sums came from Google, Facebook and Microsoft.

By Editor

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