Report from the Reuters
In Brief – European Commission Executive Vice-President Henna Virkkunen, who is responsible for the bloc’s technology sector, said that the Commission is not currently planning to propose that the digital giants regulated under the EU’s Digital Markets Act (DMA) “gatekeeper” law pay to fund ongoing enforcement. Germany and some European Parliament lawmakers have called for a supervisory fee to be levied on the tech giants to help offset expenses imposed on the EU antitrust regulators. There are currently seven DMA gatekeeper companies (Amazon, Apple, Booking, ByteDance, Google, Meta, and Microsoft) and 23 covered platforms, including eight operated by Google and just one each by ByteDance and Booking.
Context – Both the DMA and the Digital Services Act (DSA), which imposes duties on digital platforms to address objectionable content, create ongoing regulatory regimes. With both, the largest platforms are assigned to the European Commission, avoiding the GDPR’s widely criticized One Stop Shop model. The DSA requires the Very Large Online Platforms (VLOPs) regulated by the Commission to pay 0.05% of their annual worldwide net income to fund compliance. The DMA, on the other hand, did not include a regulatory funding mechanism. As if overseeing content moderation by large platforms was a meaningfully more arduous task than determining if mega-giants comply with non-discrimination and fair competition mandates? Not that the DSA supervisory fee regime has been without controversy. Meta has challenged the funding mechanism because it is based on company profits, and many VLOPs, including Amazon and X, show minimal if any profits, so they barely contribute. The DMA and DSA, as well as European digital services taxes, are limited to the largest digital companies, which are mostly US-based, causing bilateral angst. So, not imposing more taxes on them, whether for DMA regulation or to pay European telecom companies to build 5G, seems like the Commission trying to avoid adding to tensions.