For a long time, the internet remained largely unregulated by legislators around the world for fear of opening Pandora’s Box. However, this approach has now become untenable, considering that, without intervention, fundamental EU values enshrined in Article 2 TEU are at risk in the digital sphere, especially with regard to democracy and the respect for human rights.
This realisation has instigated a regulatory surge in an attempt to tackle the various problems that have emerged from digitalisation. At the forefront of this new regulatory approach is the EU.
The Digital Markets Act has the potential to significantly redefine competition law within the EU and thus help to reshape the online market where gatekeepers are present.
Our book discusses the EU’s most recent regulatory advances in digitalisation. We have collected contributions from selected experts in the fields of EU competition law and fundamental rights, focussing in particular on the recently introduced Digital Markets Act (DMA) as well as other related legislation and case law. The entire book is available in Open Access.
The Digital Markets Act (DMA)
The DMA constitutes one jigsaw piece in the EU’s digital agenda for the Single Market, in an attempt to regulate Big Tech in a more efficient way. The newly introduced ex-ante mechanism imposes per se obligations on the largest market players – so-called gatekeepers, which are otherwise capable of imposing unfair market conditions and escaping legal scrutiny. The new legislation thus promises to address the systemic market failures in digitalisation derived from a previously sole reliance on ex-post law enforcement under the traditional competition law framework.
The contributions in our book discuss this development from constitutional as well as competition law perspectives.
One crucial point of discussion here is the role of the EU Commission as the central enforcer under the DMA’s new approach. Indeed, the Commission’s newly acquired investigatory powers could be described as largely interventionist and potentially undermining general principles of EU law, such as legal certainty and legitimate expectations for the targeted gatekeepers.
However, restoring a balanced, fair, and competitive digital market remains without any real alternative for the EU legislator. With the thus increased centralisation and harmonisation in the field of competition law at EU level, Member States’ powers to take action in the digital market could be pre-empted in the long term.
From a broader perspective, the DMA raises questions as to its role and longevity in a growingly complex network of EU legislation in digitalisation. On the one hand, placing it within the generic ambit of the internal market – as evidenced by the use of Article 114 TFEU as legal base, yet specifically addressing current market players and their technologies on the other, the DMA ultimately risks falling into oblivion if transferability of its rules onto the next generation of technologies fails – a common problem of EU legislation in digitalisation.
Considering the short to medium term, however, the DMA has the potential to significantly redefine competition law within the EU and thus help to reshape the online market where gatekeepers are present. This might even have an effect well beyond the territorial boundaries of the EU, inspiring other third countries to follow suit with their regulatory endeavours or indeed change the behaviour of those market players across the globe.
The Application of Fundamental Rights
In general, the EU’s legislation in digitalisation is increasingly fundamental-rights oriented, which has a substantial impact on the application of the EU Charter and the building of a digital rule of law in line with the EU’s identity as a Union of values.
Unlike many other pieces of legislation in this area, however, the DMA is less human-centric and more focused on regulating the actual market players, sometimes described as digital sovereignty, which makes an interesting case study for our book.
The contributions in our book discuss the substantive, procedural, and institutional impact of the DMA on the application of fundamental rights.
One particularly interesting conflict concerns the freedom to conduct a business and property rights on the one hand and user autonomy and privacy rights on the other. While the former is heavily restricted by the DMA for the designated gatekeepers, the latter might arguably still be undermined by dark patterns and platform design despite the obligations imposed on gatekeepers by DMA. The lack of a clear hierarchy of fundamental rights under EU law requires the application of the principle of proportionality when balancing such rights, which is usually done on a case-by-case basis before the courts.
We have made attempts to predict future areas of conflict, which may or may not make it to the courts, and their potential solutions.
In a time of ‘rule-of-law anxiety’, the application of the principle of proportionality may become ever more important for the digital sphere. In the quest for the protection and promotion of the digital rule of law, a dialogue between the legislator and the judiciary – visible or invisible – would constitute a constitutional junction between the legislative and judicial organs of the EU.
Another conflict could occur between the enforcement of the DMA at EU level and potentially overlapping regulation at national level. Here, the principle of ‘ne bis in idem’ and the duplication of sanctions and proceedings play a crucial role. This also ties in with the conflict between online and offline due processes.
It is clear that the protection of procedural rights, such as effective judicial protection or the right to a hearing, in multilevel governance pose a range of practical challenges and that fragmentation can occur not only along the national/EU divide but also with regard to a separation between the digital and the non-digital worlds, thus posing a real threat to the uniformity objective enshrined in the DMA.
Outlook
Our book is mostly aimed at academics and researchers but also practitioners, working at the crossroads of EU digitalisation, competition law, and fundamental rights. In this highly politicised and constantly changing area of law, we have tried to unravel some of the most crucial aspects in relation to the new legislation and related case law in the field.
As is the case with much new legislation, however, its judicial interpretation will only become evident with some delay. In our book, we have made attempts to predict future areas of conflict, which may or may not make it to the courts, and their potential solutions. However, practice often brings about the unexpected and therefore future litigation will constitute new grounds for further research on the DMA itself and its relationship with competition law and fundamental rights.
In addition, the EU’s increasingly complex system of legislation in digitalisation – current and forthcoming – go well beyond the discussed legislation in this book and cover a great range of different policy areas. Their impact as well as their relationship with the EU Charter and the application of fundamental rights thereunder will have to be analysed. Moreover, the EU’s regulatory endeavours raise questions as to the disappearance of non-harmonised legislation in the field as well as potential overlap and thus conflict between the various legal acts in digitalisation.
All these aspects deserve ample attention from legal and political research perspectives as well as related disciplines. With our contributions in this book, we hope that we have been successful in providing a starting point for further discussion in this field.
