With digital platforms present in every aspect of our lives, it was only a matter of time before regulators started to think about how to manage the new issues and competition concerns they raise. Leading platforms have grown in size and market power raising concerns for regulators about dominance and market foreclosure.

Until now there has been little enforcement due to a lack of upfront regulation and limited antitrust rules, causing there to be a regulatory gap which regulators believe needs to be filled. Thus, the European Commission proposed the Digital Markets Act on 15 December 2020 with the stated aim of fostering market entry and sustainable competition in the digital platforms market.

The proposal revolves around “gatekeepers,” which will see new obligations and prohibitions placed on them to tackle economic power and abusive conduct.

Of course, the underlying competition concerns in digital markets are not confined to Europe. The United States has also seen increased concentration, rising profit margins, declining market entry, and low investment relative to profits.

For an in-depth discussion of this issue and the larger context of digital platform regulation, listen to Robert Klotz and Ciara Barbu-O’Connor on Episode 112 of Sheppard Mullin’s Nota Bene podcast at “How Europe is Filling Enforcement Gaps for Digital Gatekeepers.”