News Media Europe

DSA Series #4 – the New Competition Tool

Blog , September 23, 2020

News Media Europe prepared a comprehensive response to the public consultation on the Digital Services Act (DSA) (full document). Today, we share views on the “New Competition Tool”. Our full contribution includes a reflection on the purpose and scope of this new competition tool, and of the harmful market conduct it should seek to tackle.

The media sector faces important challenges when doing business large and powerful online platforms that also act as competitors. In our view, both ex-ante rules for digital gatekeepers and of a complementary new competition tool are needed to preserve and restore dynamic competition in digital markets.

In particular, the introduction of ex-ante rules for platforms is in itself unlikely to emerging competition concerns associated with digital markets given the pace at which such markets evolve.

A new competition tool could provide a clear basis for the proactive promotion of competition, not only on the basis of market conduct but also of market features. Such an approach to enforcement would be positive and progressive, while also address some of the substantive gaps associated with ex-ante regulation.

At a more granular level, it is of particular concern that large platforms are able to leverage their market power, or strategic market position, from one market to another in ways that are not possible for other market operators to replicate, and that are inconsistent with the principle of competition on the merits.

As such, it is important that the current regulatory toolbox is strengthened when it comes to platforms that are largely insulated from dynamic competition, especially when the said conduct is identified in the absence of a finding of dominance within the meaning of Article 102 TFEU.

It is also clear that the current competition framework has reached its limits when it comes to markets that have already tipped and that new and better use of restorative remedies, including interim measures, is needed. For this to be possible, the scope of the proposed instrument should cover both structural and behavioural remedies.

In particular, the new competition tool should explicitly include data-related remedies in the scope of the proposed instrument, including mandated access to data for third parties, mandated interoperability, and mandated data separation or prevention from integration.

Overall, it is our understanding that a new competition tool should be an instrument sufficiently flexible to address a variety of different competitive scenarios that may arise in digital markets. One of the main benefits of a new competition tool should therefore be to promote timely and efficient intervention in such markets before irreparable harm occurs.

Keeping up with change in digital markets is already widely recognised as a major challenge for competition authorities that contributes to the enforcement gap. The proposed instrument should therefore seek to add value in this area.

While a number of procedural safeguards should be introduced as regards the new competition tool a matter of general good law making, such safeguards should not be so burdensome as to undermine timely intervention in the market or to reproduce lengthy procedures traditionally associated with competition cases.

In any event, it remains essential for any new competition tool to have sufficient powers to pose a credible challenge to the systemic, anti-competitive market conduct of certain large online platforms.

The new competition tool should therefore act as a deterrent against harmful market conduct and bring more discipline to digital markets, with the understanding that dissuasiveness should remain a cornerstone of EU competition policy.