How can the Digital Markets Act impact the current EU Digital Market and what does that imply for European and foreign actors?

Details

Supervisors

Defraigne, Jean-Christophe ; Belleflamme, Paul

Faculty

Louvain School of Management

Degree label

Master de spécialisation en entreprises et politiques économiques européennes

Abstract

This paper aims at understanding the stakes and impacts of the Digital Markets Act. Thanks to the analysis, two complementary views are studied: the reaction of third- markets actors with a focus on China and the United States as well as the ability of European firms to deal with new opportunities brought by the DMA’s implementation. To conduct this study, an historical overview of the EU digital strategy is first developed, and the DMA’s legislative proposal is then theoretically defined by analyzing the rationale behind this act, the firms targeted by the authorities as well as the obligations imposed on identified gatekeepers. Following this, an investigation of the stakeholders’ positions regarding this act is provided. Then, quantitative data is used to analyze three aspects of the draft regulation: the lobbying activities around the DMA, the trends emerging all over the world regarding Big Tech’s regulation and the capacity of EU firms to compete with third-market leaders. The conclusion that is drawn is that the DMA is one of the most lobbied regulation of the European Union. Third-market stakeholders, and especially GAFAM, have spent enormous amounts of money in lobbying costs to influence the content of the act. While the DMA seems to be a major concern for third-market firms making business on the European market, the same trend is currently emerging on other continents. Both the USA and China recently decided to strengthen their own legislations in order to slow down the monopolistic positions of their national big tech companies. One of the stated goals of the DMA is to ensure fair business environment aiming at allowing EU firms to grow up and developing European leaders. Nevertheless, this objective seems to be hard to achieve. Even though the sanctions applied by the DMA would be significantly increased compared to what firms have experienced in the past, the efforts made by the EU in terms of R&D investments and market capitalization are not sufficient to close the technological gap that exists with the USA and China.