First Set of Gatekeeper Designations Issued by EC under DMA, DOJ’s Trial Against Google Begins, Heightened Interest in AI: Top Antitrust News
The European Commission (EC) has announced the first set of gatekeeper designations under the EU Digital Markets Act (DMA). Six core platform services (CPS) provided by tech giants have been designated as gateways, which means they will have obligations and restrictions imposed on them by the EC. This move is aimed at establishing fair competition and ensuring that gatekeepers comply with the rules set out by the DMA. Additionally, the EC has opened four market investigations to assess whether certain CPS should be considered gateways.
Artificial intelligence (AI) has also come under increased scrutiny in the antitrust space. The U.S. Department of Justice (DOJ) is assessing the impact of AI and its potential antitrust risks, particularly regarding pricing algorithms that can facilitate collusion and reduce competition. The UK Competition and Markets Authority (CMA) has proposed principles to guide the responsible development and use of AI foundation models (FMs) to protect consumer interests and promote healthy competition.
In a landmark trial, the DOJ has initiated legal proceedings against Google for allegedly creating an illegal online monopoly. The trial, which started on September 12, 2023, evaluates the DOJ’s claims that Google paid billions of dollars annually to be the default search engine on various browsers and devices, giving it an unfair advantage. This trial will have significant implications for other companies with large market shares and exclusive contracts.
The EC is also actively reviewing below-threshold deals under Article 22 of the EU Merger Regulation (EUMR). Two new deals have been referred to the EC for review, signaling an increased focus on sectors beyond Big Tech and pharmaceuticals. Companies involved in nonreportable mergers should be aware of the heightened risk of referrals and keep these developments in mind.
In terms of personnel changes, Justice Commissioner Didier Reynders has been appointed as the temporary Commissioner for Competition, replacing Margarethe Vestager who is now campaigning for the presidency of the European Investment Bank. Reynders will oversee competition policies, particularly as the DMA comes into effect. If Vestager is elected as the president of the EIB, a new Danish Commissioner will be appointed to replace her.
Overall, these developments demonstrate the global focus on antitrust concerns in the digital space, including the regulation of gatekeepers, the impact of AI on competition, ongoing trials against tech giants, and increased scrutiny of below-threshold deals. Antitrust enforcers and class action lawyers are closely monitoring these areas and business leaders and counsel should carefully consider the risks associated with AI-driven pricing algorithms and exclusive contracts.
