Ready, Set, TikTok! EU Digital Market Law Challenge Here!
Meta and TikTok are currently in a dispute over the extent of an EU law that will establish fresh regulations on competition within the digital market starting in March.
The European Commission has designated 22 major online companies as “core platform services” subject to additional checks and obligations under the Digital Markets Act (DMA) to combat anti-competitive practices.
The list includes familiar brands from social networks such as Facebook, Instagram and TikTok to so-called “brokerage” applications such as Google Maps, Amazon Marketplace and Apple’s AppStore, operating systems iOS, Android and Windows and Google Search.
The six tech titans behind the platform – US companies Alphabet, Amazon, Apple, Meta and Microsoft, and China’s ByteDance – have been named “gatekeepers”.
The DMA follows other EU laws that aim to impose order and rules in the digital world.
Like the Digital Services Act that entered into force in August and the 2016 General Data Protection Regulation, the DMA has sharp teeth.
Companies that violate the DMA expose themselves to fines of up to 20 percent of their global turnover, or even orders for dissolution in serious cases.
But the legislation has already been challenged, likely a foretaste of future litigation and differing interpretations of what it entails.
Meta, the owner of Facebook and Instagram, announced on Wednesday that it will take it to the EU courts over the designation of its instant messaging service Messenger as a “core platform service”, and its Facebook Marketplace will also fall under the DMA.
“This appeal seeks clarification on certain points of law regarding the designation of Messenger and Marketplace under the DMA,” said a Meta spokesperson.
“It does not change or diminish our firm commitment to comply with the DMA,” the spokesperson added alongside the lawsuit.
– TikTok went berserk –
The group is also not suing its other services under European law – Facebook, Instagram, Whatsapp and its Meta advertising service.
TikTok announced on Thursday that it is challenging its own IPO, arguing that it sees itself as an emerging player in an industry dominated by American giants.
“Our designation may undermine the DMA’s own stated goal of protecting the true gatekeepers from newer competitors such as TikTok,” the company wrote on its website.
“The naming decision is based on a fundamental misunderstanding of our business and threatens our ability to grow and compete with true gatekeepers.”
The companies concerned have until Thursday to file a lawsuit.
The European Commission refused to comment to the news agency AFP.
However, an EU official said EU enforcement officials are confident that all designated companies will aim to comply with the DMA before March 6, 2024.
“Companies are facing legal challenges, but at the same time they are doing what is necessary to comply with the law,” said the official, who spoke on condition of anonymity.
DMA requires interoperability between competing services and ensures easy removal of pre-installed applications.
It requires Apple to allow iPhone and iPad users to turn to app stores other than the AppStore to get software for their devices.
It also denies all top results from search engines, which often leads to the accusation of Google – that its site favors its own Google Shopping platform at the expense of competitors.
“These petitions are understandable, they are even healthy. This shows that we have a rule of law,” said Alexandre de Streel, director of the European Center for Regulatory Affairs (CERRE).
“There are uncertainties in the early stages of the new law that need to be worked out,” he said.
“I’m not surprised that there are two or three challenges now, but I think there will be more when it comes to interpreting some of the (DMA) obligations.”
