Digital Markets Act (DMA): The EU announced the investigation into Apple, Alphabet, and Meta under the newly formed Digital Markets Act (DMA) which came into force on March 7th The probe is done to determine whether these tech giants have violated the DMA regulations and laws.

Digital Markets Act (DMA)

The Digital Services Act is the legislations from the European Union that aim to regulate & limit the powers of global internet companies like Google, Apple, Facebook and Amazon in the European market. Under the legislation, the larger firms are designated as ‘digital gatekeepers’ and would be subject to stricter regulations. Violation of competition rules could invite as much as 10% of the firm’s annual turnover.

Purpose: DSA aims to set up clear rules for handling harmful stuff online, protect people’s rights on the internet, and make online companies more responsible for what happens on their platforms.

Key Features:

  1. Notices for Illegal Content: Websites and apps must have an easy way for users to report illegal stuff they see.
  2. Complaint Systems: Platforms need systems to deal with complaints from users.
  3. Transparency: Platforms must explain why they remove certain content.
  4. Ad Transparency: Ads must be clearly labelled as ads, show who’s behind them, and give users info on why they’re being targeted.
  5. Very Large Platforms: Big platforms with over 45 million users need to share data to prove they’re following the rules.

Penalties: If platforms don’t follow these rules, they could be fined up to 6% of their yearly income.

Digital Markets Act (DMA):

Purpose: DMA aims to fix unfairness in the digital market, especially for big players like social media, search engines, and online stores.

Explanation Of Key Terms:

  1. Gatekeepers: Big platforms with a lot of users and a big influence are called gatekeepers. They have special rules to follow.
  2. Conditions for Gatekeepers: To be a gatekeeper, a platform needs to be big, operate in many European countries, and have a lot of money.
  3. Obligations for Gatekeepers: Gatekeepers must make it easy for other businesses to work with them and share certain data.
  4. Penalties: If gatekeepers don’t play fair, they could be fined up to 10% of their yearly income.

Key features of the Digital Services Act

  • The act makes it mandatory for every hosting provider to put in a user-friendly notice that provides permission to notify about illegal content.
  • The online platforms have to establish internal complaint-handling systems. To resolve disputes with their users, the online platforms should engage with out-of-court dispute settlement bodies.
  • New transparency obligations have been included. When content is removed, an explanation should be provided to the person who uploaded the content.
  • The act imposes a fine for non-compliance up to 6% of the annual income.

For every advertisement and to every user the online platform should provide clear information. It includes the following

  • The user should be clear that he or she is watching or seeing an advertisement.
  • The advertisement should be very clear in conveying the fact that on whose behalf it is being displayed.
  • It should provide meaningful information about the main parameters so that the user can determine why he or she is targeted by this ad.
Very Large Platforms
  • The Digital Services Act defines very large online platforms as those with more than 45 million users. This is roughly equal to 10% of the European Union population.
  • The very large platforms upon request, must allow access to the data required to monitor their compliance with the Data Service Act.
  • The very large platforms should provide transparency on the main parameters of decision-making algorithms. These algorithms are usually used to offer content on their platforms, basically the ranking mechanism.

Who enacted the Digital Markets Act (DMA)?

European Union (EU) enacted the Digital Markets Act (DMA).

Ashutosh Raj

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