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    EC Designates Gatekeeper under the DMA, spares TikTok ads and X ads

    The European Commission announced that it had designated the digital travel website a gatekeeper under the EU’s Digital Markets Act, and exempted advertising businesses ‘X ads’ and ‘TikTok ads’ from being gatekeepers. It also announced that it has initiated a market investigation into social media platform X to decide its designation.

    What is a gatekeeper?

    Businesses with significant impact on the digital markets that serve as an important intermediary between businesses and consumers and meet the defined user and financial thresholds are designated gatekeepers under the Digital Markets Act (DMA). These gatekeepers are subject to certain ex-ante regulations which aim to ensure fair and contestable markets in the Digital sector. So far, six entities (and their corresponding services): Apple, Microsoft, Google, Amazon, Meta, and Bytedance were designated as gatekeepers and subsequently asked to comply with the obligations under the DMA in the EU.

    What regulations will have to comply with? was designated as a gatekeeper based on a self-assessment. As it met all the defined criteria, the EC ordered to comply with the obligations under the DMA within six months. is also required “to submit a detailed compliance report in which it outlines how it complies with each of the obligations of the DMA.”

    The EC has stated that will have to comply with some obligations like informing the Commission of “any intended concentration in the digital sector” effective immediately. While has not confirmed the aspects they will need to comply with, here are some of the obligations under the DMA that may apply to

    • Not self-preferencing one’s services and adequately displaying other competing businesses on its platform
    • Allow business users to promote their offers and conclude contracts with customers outside the gatekeeper’s platform.
    • Providing business users with access to the data generated by their activities on its platform.
    • Not using business users’ data when competing with them on their platform.

    Gatekeepers that do not comply with the obligations under the DMA can be fined up to 10% of their total worldwide turnover, and 20% in case of repeated infringements.  In case of systematic infringements, the EC can direct a gatekeeper to sell a business or parts of it or ban the gatekeeper from “acquisitions of additional services related to the systemic non-compliance.”

    Why were TikTok Ads and X Ads not designated as gatekeepers?

    According to rebuttals filed by both TikTok and X, the Commission noted that while both advertising businesses met the quantitative thresholds under the DMA, they did not meet the qualitative criteria of being an “important gateway” between users and businesses.

    However, the Commission has opened a market investigation into X, the online social networking platform, to assess if it meets the qualitative criteria to be designated as a gatekeeper, which X has argued against. The EC stated that the investigation should be completed within five months.

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    The post EC Designates Gatekeeper under the DMA, spares TikTok ads and X ads appeared first on MEDIANAMA.

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