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Antitrust in the digital sector: An overview of EU and national case law

In ten years, digital has become one of the main focuses, if not THE main one, of antitrust enforcers in Europe and worldwide. The digital transformation of all developed economies has raised new issues that traditional antitrust tools may or may not be able to address. The perceived “enforcement gap” when it comes to the digital world, and especially platforms, has prompted agencies in various corners of the world to ponder whether a revamp of our antitrust regulations may be required to face the new challenges that result from digitalization.

There is an inherent difficulty in circumscribing the “digital sector”, though. Today, digital is everywhere: retail, banking, health, travel, medias, music – everything has become digital. From a computer or their phone, consumers can access almost all products and services in a wide range of business sectors.

As a result, a very large number of competition law cases touch upon the question of digitalization. Over the past two years alone, hundreds of decisions and initiatives have been issued by competition enforcers worldwide, which aim to address some aspect(s) of the digital economy. This issue of e-Competitions devoted to “Antitrust in the Digital Sector” includes more than a hundred articles written on the subject in 2020-2021, and many more could have been added.

It is obviously impossible, in this Foreword, to cover it all. We will therefore try to concentrate on the more significant developments of the past two years, starting with the paradigm-changing initiatives that have been proposed and, in some cases, already implemented for the ex ante regulation of platforms (I.). From the Digital Market Act to the initiatives adopted in China or Australia, enforcers and legislators worldwide have been trying to regulate the way the largest platforms (also known as the GAFAM – Google, Amazon, Facebook, Apple and Microsoft) operate. Although these do not constitute “case law” stricto sensu, it is impossible to address antitrust in the digital sector in the 2020s without mentioning this new approach.

It does not mean that actual antitrust enforcement is going down, though. The past two years have seen numerous decisions and ongoing cases against the GAFAM, targeting both “classic” issues, including interoperability, foreclosure or exchanges of information, and evolving concerns, such as the boundary between privacy and competition law (II.).

Digitalization has even impacted merger control (III.). On this side of the Atlantic, the evolution of the European Commission’s doctrine regarding the application of Article 22 of Regulation No 139/2004 (the “European Merger Control Regulation” or “EUMR”) is meant to allow the Commission to look at acquisitions made by the largest platforms – with limited results so far. In the United States, agencies are proactively looking back to acquisitions made by the GAFAM in the past, entertaining the possibility of actually unwinding some of them.

These aspects do not even begin to cover the more exotic initiatives taken in some jurisdictions globally. But they offer a good look into the challenges both enforcers and digital market players are currently facing when it comes to the application of antitrust rules in the online world.

I. Ex-ante regulation initiatives

In the past two years, many jurisdictions worldwide have launched initiatives that aim at better regulating platforms in the context of a perceived enforcement gap. Many commenters indeed believe that the agencies’ existing enforcement powers would be insufficient – or not sufficiently nimble – to tackle the new competition issues rising in the fast-paced digital world. As Margrethe Vestager, Executive Vice-President of the European Commission in charge of Competition and Digital, recently framed it: “as the power of digital platforms has grown, it has become increasingly clear that we need something more, to keep that power in check, and to keep our digital world open and fair.” [1]

The Digital Market Act. In Europe, the most prominent of these initiatives is the Digital Market Act, or DMA, proposed by the Commission in December 2020, [2] following an initial Inception Impact Assessment for a New Competition Tool meant to address the perceived issues raised by digital platforms. [3] The Commission’s proposal was significantly amended by the European Parliament in December 2021 [4] and a political agreement was reached between the Parliament and the Council on 25 March 2022. [5] It has been recently followed by a new regulation proposal by the European Parliament and of the Council dated 11 May 2022, which alters and supplements several provisions of the original proposal. [6]

The DMA covers “gatekeepers”, i.e., platforms that meet the following criteria: (a) significant impact on the internal market; (b) provide a core platform service, which is an important gateway for business users to reach end users; and (c) enjoy or will enjoy an entrenched and durable position. [7] The DMA also provides quantitative thresholds that, when met, create a rebuttable presumption that a given platform qualifies as a gatekeeper; [8] these thresholds have been increased by the European Parliament and the Council and now read as follows:

  1. The platform is deemed to have a significant impact on the European internal market if its annual European Union turnover equals or exceeds €7,5 billion in each of the last three financial years, or if its average market capitalisation or its equivalent fair market value amounts to at least €75 billion in the last financial year;
  2. It is presumed to constitute an important gateway where the undertaking provides a core platform service that, in the last financial year, has had on average at least 45 million monthly active end users established or located in the European Union and at least 10,000 yearly active business users established in the European Union; and
  3. The position of the platform is considered entrenched and durable where the previous thresholds are met in each of the previous three financial years.

Any undertaking that meets the above-mentioned thresholds shall have to notify the European Commission within two months. [9] In theory, it may, however, rebut the presumption by providing sufficiently substantiated arguments demonstrating that, although the quantitative thresholds set out in the DMA are met, the platform does not fulfil the requirements for designation as a gatekeeper [10] – in practice, though, the presumption is very likely to prove almost impossible to rebut.

The consequences for the platforms of being qualified as gatekeepers are particularly stringent, as the DMA identifies a number of practices, including technical and commercial requirements, that will either be prohibited or mandatory for gatekeepers. Article 5 of the DMA provides a list of obligations and prohibitions applicable to all gatekeepers, while Article 6 lists obligations that may be further specified, if appropriate, following a dialogue between the Commission and the gatekeepers, and after enabling third parties to comment. [11] These requirements are mainly derived from the existing EU case law and decisional practice when it comes to large digital players.

On that basis, gatekeepers shall notably be prohibited from:

  • Processing personal data of end users without their consent for the purpose of online advertising, combining these data with those gathered by other services, or making use of the data in other services [12]. This prohibition seems to be, inter alia, derived from the Facebook case before the Bundeskartellamt; [13]
  • Imposing MFNs (most-favoured nation clauses) on business users [14] – which derives directly from the commitments conceded by Amazon in the eBooks MFNs case [15] and from the various cases throughout Europe; [16]
  • Requiring end users or business users to use the undertaking’s other services (including identification services, web browser engine, payment services) to access the platform. [17] This would seem to answer, inter alia, the preliminary competition concerns expressed by the European Commission in its Statement of objection of 2 May 2022 regarding the Apple Pay solution, [18] although these aspects are still being investigated at this time;
  • Self-preferencing, [19] which echoes the position taken by the Commission and the General Court in the Google Shopping case; [20]
  • Using the non-public data generated by the activity of its business users to compete with them. [21] The Amazon Marketplace case, regarding Amazon’s use of its marketplace sellers’ data, particularly targets this situation. [22]

On the other hand, gatekeepers will, inter alia, be required to:

  • Allow business users to promote their offers under different conditions depending on the platform or distribution channel used. [23] This requirement is notably reminiscent of the Apple Music streaming case currently investigated by the European Commission, regarding the use of Apple proprietary in-app purchase system for the distribution of apps and the restriction to the ability of developers to inform users of alternative purchasing possibilities outside of the apps; [24]
  • Increase the transparency of online advertising services by providing advertisers and publishers with information regarding in particular the prices of each service, [25] a requirement that follows the concerns expressed by the European Commission in the Google Ad Tech case; [26]
  • Provide any third party supplying online search engine services with the data generated by their end users and related to ranking, click&view history and view date, based on fair, reasonable and non-discriminatory (FRAND) terms; [27] and
  • Ensure interoperability of digital interpersonal communication services. [28]

In case of non-compliance with these obligations, the Commission may impose fines of up to 10% of the gatekeeper’s worldwide turnover in the preceding financial year. Following the political agreement found between the European Parliament and the Council, higher fines of up to 20% of the gatekeeper’s turnover could be imposed in the event of repeated infringements in relation to the same core platform service within a period of eight years. [29] Should the Commission find “systematic non-compliance” by a gatekeeper, i.e., three non-compliance decisions have been issued within a period of eight years, it can impose any behavioural or structural remedies (potentially going as far as the dismantling of the undertaking at stake) to ensure compliance with the DMA. [30]

One of the key questions raised by the DMA relates to its practical implementation. While the European Commission had initially foreseen that the DMA would be solely enforced by the EU regulator, the European Parliament was inclined, following the intervention in the debate of the European Competition Network (ECN), [31] to allow national competition agencies (NCAs) to enforce the text concurrently with the Commission. The view of the Commission prevailed eventually, mainly to avoid divergences among Member States. The opening of proceedings by the Commission for non-compliance with the DMA shall therefore relieve all NCAs of the possibility to conduct a parallel investigation into the same facts. In order to nonetheless involve NCAs, the DMA creates a new working group including the NCAs, [32] which may provide advice and expertise on any general matter related to the implementation or enforcement of the DMA.

Finally, in order to avoid a fragmentation of the national legislation regarding platforms, the draft DMA prohibits Member States from imposing further obligations on gatekeepers, which would have the purpose of ensuring contestable and fair markets – without of course prejudice to the application of competition law. [33] This raises questions with respect to the articulation between the DMA and national legislations such as Section 19a of the new German Competition Act adopted in January 2021 (see below). The new draft proposal therefore added an obligation for the Commission and Member States to work in close cooperation and coordinate their enforcement actions to ensure the coherent, effective and complementary enforcement of available legal instruments applied to gatekeepers. [34]

The DMA is scheduled to enter into force in 2023. It will give tremendous powers to the Commission to regulate platforms, including their business models and potentially (in the case of structural remedies) their very scope. This approach obviously raises many questions that will only be answered after a few years of practice.

Section 19a of the German Competition Act. The tenth reform of the German Competition Act, adopted in January 2021, [35] introduced a new Section 19a in the law.

This provision creates a new category of abuses committed by undertakings “of paramount significance for competition across markets” and threatening effective competition. [36] Section 19a is enforced following a two-step approach by the Bundeskartellamt. In order to determine the identity of the undertakings targeted by this provision, the Bundeskartellamt will first take into account their financial strength, possible dominant position on one or several markets and/or their access to data relevant for competition. [37] Once a company is deemed to have such “paramount significance for competition across markets”, the Bundeskartellamt may directly prohibit a series of practices ranging from self-preferencing to parity clause. [38]

The Bundeskartellamt has already made an active use of this new provision. Very recently, the agency confirmed that Section 19a applies to Google [39] and initiated proceedings concerning Google News Showcase service, on the grounds notably that Google might be self-preferencing. Google offered measures to dispel the authority’s concerns, which were submitted to a public consultation with press publishers in January 2022. [40]

UK initiatives. Following the recommendations of the Furman report in March 2019, [41] a “Digital Markets Unit” (DMU) was created in the United Kingdom, composed of a Digital Markets Taskforce housed temporarily in the Competition and Markets Authority (“CMA”).

The purpose of the DMU is to implement a new regulatory framework for competition in digital markets, applying notably to companies with a Strategic Market Status (SMS), a concept close to that of “gatekeeper” in the DMA. SMS covers undertakings that have substantial, entrenched market power in at least one digital activity, allowing these undertakings, thanks in particular to their size and the fact that they are access points to customers, to determine the rules of the game. Once an SMS company has been identified, it will be governed by a code of conduct, which should establish legally enforceable obligations in order to prevent SMS undertakings from taking advantage of their market positions. The aim is to provide a clear set of ex ante principles for SMS companies based on three main objectives: fair-trading, open choices, and trust and transparency.

The DMU can also carry out Pro-Competitive Interventions (“PCI”) to rectify any adverse effect on competition or consumers related to the operations of an SMS company. The range of remedies available to the DMU runs from data-related interventions, interoperability and common standards, obligations to provide access on fair and reasonable terms to structural remedies. [42] The DMU may also impose substantial penalties (up to 10% of annual global turnover) [43] for “serious breach [of the code] that causes significant harm” and for non-compliance with remedies and PCI orders.

Recently, the UK Government conducted a consultation [44] where it proposed, inter alia, to give the DMU additional powers to scrutinize mergers involving SMS firms or the power to devise legally binding obligations on firms that can be tailored to the business models of each firm instead of general requirements. The CMA welcomed the proposed reforms proposed in October 2021. [45] The DMU now awaits parliamentary legislation to be given statutory powers; no legislative timeline has been set so far, though.

The French Digital Unit. Finally, it should be noted that a new Digital Unit was created within the French Competition Authority in January 2020. The task force, which includes an engineer, a former lawyer, economists and two data scientists in charge of developing in-house expertise for the French watchdog in all things digital and will be involved in the future investigation of anticompetitive practices. Unlike its UK counterpart, however, it will not be granted any ex ante regulatory powers.

II. Antitrust enforcement against platforms

New regulatory initiatives towards platforms have not dried out the stream of “traditional” enforcement actions against the GAFAM, though.

It would be impossible to discuss in this Foreword the entire array of cases against Google, Amazon, Facebook and Apple (Microsoft being somewhat less targeted at this point) that either are ongoing or have been completed since 2020. We therefore focus below on the more prominent issues that have been recently tackled by competition authorities worldwide regarding platforms, going from the findings of the EU General Court in the Google Shopping case regarding self-preferencing to the new questions arising around privacy and antitrust.

The Google Shopping ruling. On 10 November, the EU General Court largely dismissed the appeal filed by Google against the European Commission’s Google Shopping decision, [46] which fined Google €2.42 billion in 2017 for self-preferencing its own comparison shopping service on the result pages of its universal search engine. [47]

The Court upheld the Commission’s findings that, by displaying its own service in a more favourable way on the general result pages, while relegating the results from competing comparison services in those pages by means of ranking algorithms, Google departed from competition on the merits. Although it is not prohibited for a dominant company, even with a market position as strong and entrenched as Google’s, to enter into a neighbouring market, the Court found that given (i) the importance of the traffic generated by Google’s search engine for comparison shopping services; (ii) the behaviour of users, who typically concentrate on the first few results; and (iii) the large proportion of ‘diverted’ traffic and the fact that it cannot be effectively replaced, the practice at issue was liable to lead to a weakening of competition on the market.

Importantly, the Court ruled that Google general results page has characteristics akin to those of an essential facility, as there is currently no actual or potential substitute available that would enable it to be replaced in an economically viable manner on the market. However, the Court also confirmed that not every practice relating to the access to such a facility necessarily needs to be assessed in the light of the conditions applicable to refusals to supply, as set out in the Bronner case, [48] on which Google relied – thus making the burden of proof lighter for the European Commission. In this case, the General Court considered that Google’s behaviour should not be analysed as a refusal to supply but as a difference in treatment by Google for the sole benefit of its own comparison service, which can in itself be considered abusive, especially when search results should normally be open and non-discriminatory.

Finally, the Court upheld the Commission’s finding that the practices at stake harmed competition on the market for comparison shopping services, but found that the Commission did not establish that Google’s conduct had had – even potential – anticompetitive effects on the market for general search services. On that second aspect, the Court considered that the Commission merely mentioned that, by treating its own comparison shopping service more favourably on its general results pages, Google was protecting the revenue from those pages that was generated by that specialised search service, revenue which, in turn, financed its general search service. According to the Court, “[t]hese considerations alone are too imprecise to show that there are anticompetitive effects, even potential effects, in the national markets for general search services [as n]o analysis has been presented of the importance of the revenues concerned or of their possible impact on the position of Google and Google’s competitors on those markets.” [49] Nevertheless, the existence of anticompetitive effects on the market for comparison shopping services were considered sufficient to confirm the abuse.

App stores and payment services. Recently, the focus of competition authorities seems to have shifted from general web services towards app stores. Google and Apple are both the focus of multiple investigations worldwide, not to mention significant lawsuits in the U.S. Courts, that target the way app developers are treated regarding especially (i) in-app payments and (ii) fees charged to the developers by the owner of the operating system (Android for Google and iOS for Apple).

The first to strike was the Italian Competition Authority, which in May 2021 fined Google €102 million for abusing its dominant position by refusing to let Enel, the major Italian energy provider develop an app compatible with some of the Android fixtures. The Italian watchdog found that Google holds a dominant position allowing it to control the access of app developers to end users in Italy, given that (i) about three quarters of Italian smartphones use the Android system and (ii) Google is a major global player in the digital economy and relies on a very significant financial strength. Google’s refusal to allow Enel X Italia to develop a version of its JuicePass app (offering services to drivers of electric vehicles) compatible with Android Auto, a specific Android feature that allows apps to be used while the user is driving, therefore unfairly limited the possibilities for end users to access the Enel X Italia app.

In addition to the fine, Google was ordered to make available to Enel X Italia and other app developers the necessary tools for the programming of apps that are interoperable with Android Auto. The authority will monitor the effective and correct implementation of the imposed obligations through an independent expert to whom Google must provide all cooperation and information requested.

Shortly following this decision, in July 2021, thirty-six U.S. States and the District of Columbia brought an antitrust lawsuit against Google in front of the U.S. Northern District Court of California (San Francisco Division), accusing the company of restraining competition in the markets for (i) Android software app distribution and (ii) payment processing of digital content purchased within the United States. [50] The plaintiffs argue that Google used anticompetitive means, including exclusionary agreements with phone manufacturers and carriers, to maintain a 30% commission for all purchases made by consumers in the Android ecosystem (purchase of apps in the Google Play Store, purchase of digital content or subscriptions within apps). Under scrutiny are also Google’s requirements that all app developers selling content through the Google Play Store charge all digital in-app content through the Google Play Billing service, and the prohibition for app developers to direct consumers to (or even inform consumers of) alternative payment processing options.

A similar case is being brought by the European Commission against Apple regarding both music streaming apps and ebooks/audiobooks. On 16 June 2020, the Commission opened an investigation into the App Store terms and conditions that (i) impose the use of Apple’s proprietary in-app purchase system, including a 30% commission on all subscription fees, and (ii) limit the ability of app developers to inform users of alternative – and usually cheaper –purchasing possibilities outside the App Store. [51]

On that basis, on 30 April 2021, the Commission sent Apple a statement of objection regarding music streaming apps. [52] The Commission’s preliminary view is that Apple’s conduct could potentially infringe Article 102 TFEU as (i) Apple could be dominant in the market for the distribution of music streaming apps through the App Store, which is the sole gateway to reach consumers using Apple mobile devices, and (ii) Apple’s rules for the App Store could distort competition in the market for music streaming services by raising costs of competing music streaming app developers, in turn raising prices of in-app subscriptions for consumers. The case is however complicated by the fact that Spotify, the main provider of music streaming services, is potentially dominant in its own market, which could put into question the Commission’s assessment of any anticompetitive effect.

Finally, it is worth noting that in the United States, Epic Games, developer of the very popular Fortnite game, is suing both Google [53] and Apple [54] for violating antitrust laws through their respective app stores’ terms and conditions. Epic Games challenges in particular the obligation to use Google’s and Apple’s in-app payment system and the 30%-commission charged by both platforms to developers. In the case against Apple, the U.S. District Court (Northern District of California) ruled on 10 September 2021 that Apple is not an antitrust monopolist in the market for mobile gaming transactions; however, it still held that Apple’s conduct in enforcing its anti-steering restrictions should be viewed as anticompetitive and calls for an appropriate remedy. [55] It thus restrained Apple from prohibiting developers from including in their apps external links or other calls to action to direct customers to alternative purchasing mechanisms. The judgment is currently under appeal.

New issues. New questions are currently arising from the operation of platforms, beyond traditional antitrust concerns of foreclosure. A first issue relates to the way major platforms like Google and Facebook deal with the news. Beyond the Facebook-Cambridge Analytica scandal during the 2016 presidential election, on 9 April 2020, the French Competition Authority imposed interim measures ordering Google to stop using the content produced by press publishers for free and negotiate with those publishers to find a suitable payment mechanism for the content used. [56] The French regulator found that Google’s practices caused a serious and immediate damage to the press sector at a time the economic situation of publishers and press agencies is fragile, which needed to be remediated. And on 12 July 2021, the French Competition Authority fined Google €500 million for breaching its obligation to conduct good faith negotiations with the publishers and trying to circumvent the French rules granting those publishers a fair remuneration for their content. [57]

Another issue that has been increasingly addressed by enforcers worldwide is the question of privacy and its interaction with antitrust rules. In the Facebook case before the Bundeskartellamt, [58] the German watchdog considered that Facebook’s failure to comply with the EU General Data Protection Regulation (GDPR) by tracking users’ activities on third-party websites without their express consent constituted an abuse of Facebook’s dominant position in the market for social networks in Germany. As a result, the Bundeskartellamt imposed on Facebook far-reaching restrictions in the processing of user data. These obligations were however suspended in appeal, before being reinstated again. [59]

After this judicial back-and-forth, the Higher Regional Court in Düsseldorf eventually decided on 22 April 2021 to refer the case to the European Court of Justice, asking in particular whether a competition authority, which is not a supervisory authority within the meaning of the GDPR, has jurisdiction to assess the existence of a breach of GDPR and use it to demonstrate the existence of an infringement of Article 102 TFEU. [60] The answer of the Court, which is expected later this year, will have a significant impact on the interaction between competition law and privacy in Europe.

On the other hand, the French Competition Authority rejected in March 2021 a request for interim measures filed by a group of undertakings active in online advertising against Apple’s new App Tracking Transparency (ATT) feature, which increased privacy safeguards by asking users to expressly consent to allow apps to collect and share their data across third-party apps and web sites. [61] The plaintiffs argued that, by going further to protect privacy than strictly required by the GDPR, Apple would distort competition to the detriment of app developers and advertising services.

The French Competition Authority found, however, that the ATT feature does not appear as abusive prima facie since (i) a company, whether dominant or not, is free to set the rules that apply to its own services, and (ii) in the present case, even if the ATT goes beyond the GDPR requirements, it does not appear as unjustified or disproportionate to Apple’s legitimate aim to protect users’ privacy. The French watchdog is still investigating if Apple could be self-preferencing by getting access to more data than other providers of advertising services, though – but the decision, which took into account the amica curiae brief issued by the French data protection agency (CNIL), still offers an interesting insight into the way privacy and antitrust could be articulated going forward.

III. Merger control

Last but not least, discussions as to how issues related to the digital sector may be more effectively addressed under merger control rules have also taken a prominent place in the past couple of years.

New EU powers. In Europe, the Commission has repurposed its existing powers in order to capture deals that do not meet the filing thresholds in any EU jurisdiction, targeting in particular deals in the digital world, where targets may not have any significant turnover to show for their (often free) services – at least before they reach a sufficient audience to generate advertising revenues.

In September 2020, Commissioner Margrethe Vestager announced that the European Commission would start to welcome referrals by Member States, under Article 22 of the EUMR, for transactions not meeting national filing thresholds but likely affecting competition in Europe. This possibility, originally foreseen by the text of Article 22 to enable Member States with merger control system to refer transactions to the Commission for review, had been abandoned when all EU jurisdictions (with the exception of Luxembourg) adopted domestic merger control powers. It has now been rekindled to allow the Commission to review potential “killer acquisitions”, i.e., the acquisition by a significant market player of an innovative start-up that does not yet generate any significant turnover.

Here again, the move is intended to close a perceived enforcement gap that prevented the European Commission from reviewing the Facebook/Instagram deal, for instance. Guidance published by the Commission in March 2021 [62] indicates that implementation of this new tool will mostly focus on sectors in which innovation is key, such as the digital and life science areas, which are considered to have the highest risk of incumbents acquiring start-ups with strong competitive potential but minimal revenues. Under the guidance, concentrations that may be suitable for such referrals are deals where the target is (i) a start-up or recent entrant with low turnover but significant competitive potential, or (ii) an important innovator or a company conducting potentially important research, or (iii) an undertaking with access to competitively significant assets (such as raw materials, infrastructure, data or intellectual property rights), or that provides products or services that are key for other industries.

Importantly, this new interpretation of Article 22 EUMR should be read in conjunction with the new provision of the DMA that requires gatekeepers to inform the Commission of any intended concentration, whenever the target provides either core platform services or any other services in the digital sector, or when it enables the collection of data, irrespective of whether the transaction would be reportable under the EUMR. The question was expressly raised, at the time of the Commission’s initial proposal, of how this provision should articulate with the new Article 22 EUMR guidance. The new proposal from the European Parliament and the Council has now confirmed that the Commission will indeed be able to use this provision of the DMA in combination with its new power pursuant to Article 22 EUMR. The proposal thus specifies that the NCAs may use the information provided by the gatekeepers under the DMA to refer the deal to the Commission.

Latest EU developments. In practice, however, the recent review of digital deals by the European Commission has been somewhat of an anti-climax.

Article 22 EUMR was used by Austria and other Member States (including Belgium, Bulgaria, France, Iceland, Ireland, Italy, the Netherlands, Portugal and Romania) to refer the Facebook/Kustomer transaction to the Commission on 2 April 2021. [63] After opening an in-depth investigation on 2 August 2021, the Commission cleared the deal with limited commitments. The Commission’s concerns addressed by the decision were limited to the fact that, post-transaction, Meta (Facebook) would potentially have the ability, as well as an economic incentive, to engage in foreclosure strategies vis-à-vis Kustomer’s closest rivals and new entrants, by denying or degrading access to the application programming interfaces (APIs) for Facebook’s messaging channels. The Commission considered that, similar to Kustomer, these players have a focus on small and medium business customers (SMBs) and are particular drivers of innovation. Therefore, these foreclosure strategies could have reduced competition in the market, leading to higher prices, lower quality and less innovation for business customers, SMBs in particular, which may in turn be passed on to consumers. To alleviate these concerns, Meta offered “comprehensive access commitments” to its API, with a 10-year duration.

However, while the Commission had initially identified preliminary concerns related to online display advertising services, it eventually found that the merger was not likely to lead to a significant impediment of effective competition. In particular, the Commission investigated what data Meta would obtain from Kustomer’s customers. It considered, though, that Kustomer offers a business-to-business product and does not own the data of its business customers. Access to data would thus be dependent on agreements with these customers, who in turn would need consent from their end customers. In any event, because of Kustomer’s small size, the Commission argued that, even taking into account the company’s potential growth, the amount of additional data that it would bring to Facebook would not be significant. Moreover, the Commission noted that rival providers of online display advertising services have, and will continue to have, access to similar commercial data because of the strong commercial interest of businesses in sharing such data with both Meta and rival advertising platforms in order to measure and optimize the performance of their ad campaigns.

Therefore, the Commission concluded that any additional data that Meta may gain access to for the purposes of improving its online display advertising service would not result in a significant negative impact on competition between providers of online display advertising services – even though many market players had initially voiced strong concerns in that respect.

In Google/Fitbit, [64] the European Commission declined to examine the question of data and privacy. Fitbit is active in the fast-growing smartwatch segment and, while the Commission’s investigation did focus on the data collected via Fitbit’s wearable devices and the interoperability of wearable devices with Google’s Android operating system for smartphones, in close cooperation with the European Data Protection Board, it refused to take position on the privacy concern raised by several market participants indicating that it would be increasingly difficult for users to track what their health data would be used for. The Commission considered, as a preliminary remark to its assessment, that Google and Fitbit would be bound by the provisions and principles of the GDPR and ePrivacy Directive, so that its analysis of the concentration “is predicated on the assumption that the Parties could lawfully combine their datasets. [65] More explicitly, in its press release, the Commission argued that “such concerns are not within the remit of merger control and there are regulatory tools better placed to address them.” [66]

As a consequence, the concerns addressed by the decision of the Commission are limited to purely commercial aspects, namely (i) the fact that by gaining access to Fitbit’s data, Google would be able to raise barriers to entry and expansion for its competitors in the markets for online search advertising, online display advertising, and the entire “ad tech” ecosystem, to the detriment of advertisers; (ii) the potential restrictions that could be imposed by Google on competitors’ access to the Fitbit Web API, to the detriment of start-ups in the nascent European digital healthcare space; and (iii) the possibility for Google to put competing manufacturers of wrist-worn wearable devices at a disadvantage by degrading their interoperability with Android smartphones. In response, Google offered 10-year commitments to guarantee (i) the separation between Fitbit’s and Google’s data (this commitment being subject to a potential extension for an additional ten years by the Commission), (ii) access to users’ health and fitness data to software applications through the Fitbit Web API, and (iii) free licenses covering all current core functionalities that wrist-worn devices need to interoperate with an Android smartphone licenses for Android original equipment manufacturers (OEMs).

New U.S. approach to digital mergers. This approach contrasts with the U.S. Federal Trade Commission (FTC) decision to revisit the acquisitions made by Google, Amazon, Facebook, Apple and Microsoft over the past decade. In February 2020, the FTC issued Special Orders to all five companies, requiring them to provide information about prior acquisitions not reported to the antitrust agencies under the Hart-Scott-Rodino (HSR) Act, including information and documents on the terms, scope, structure, and purpose of transactions that each company consummated between 1st January 2010 and 31st December 2019.

According to FTC Chair Lina Khan, the outcome of this review “captures the extent to which these firms have devoted tremendous resources to acquiring start-ups, patent portfolios, and entire teams of technologists—and how they were able to do so largely outside of [the FTC’s] purview.” [67]

More striking still is the lawsuit filed on 9 December 2020 by the New York Attorney General and 46 State Attorneys General against Facebook, targeting alleged predatory acquisitions – in particular the acquisition by Facebook of Instagram in April 2012 and WhatsApp in 2014. The complaint alleges that Facebook targets competitors with a “buy or bury” approach: if they refuse to be bought out, Facebook allegedly tries to deprive competing companies of what they need to operate. The plaintiffs seek to have the court (i) restrain Facebook from making further acquisitions valued at or in excess of U.S. $10 million without advance notice to the state of New York and other plaintiff states, and (ii) provide any additional relief it determines is appropriate, including the divestiture or restructuring of allegedly illegally acquired companies, or current Facebook assets or business lines. The FTC filed a complaint seeking similar relief at the same time. [68]

This unprecedented move shows the shifting focus, in the U.S., from antitrust enforcement to the use of merger control rules to address the issues raised by the GAFAM’s market power. Although the federal court dismissed both the FTC’s and Attorneys General’s claims in June 2021, based on the finding that they had failed to prove that Facebook holds monopoly power in the U.S. market for personal social networks, a second ruling dated January 2022, adopted pursuant to a re-filing of its complaint by the FTC, allowed the case to go forward. Although the FTC still has a long way to go to prove its case, the outcome of the trial may significantly re-shape U.S. merger control policy in the digital sector.


The past two years have seen extraordinary antitrust enforcement in the digital sector, with a very wide array of initiatives from agencies worldwide, most of which have not even started to produce their full effects yet. Given the level of experimentation currently going on and the pace at which digital innovations are changing our economies, the next issue of this Foreword will most certainly have many new developments to report, which may significantly alter the way we think about and enforce antitrust rules in the future.

Note from the Editors: although the e-Competitions editors are doing their best to build a comprehensive set of the leading EU and national antitrust cases, the completeness of the database cannot be guaranteed. The present foreword seeks to provide readers with a view of the existing trends based primarily on cases reported in e-Competitions. Readers are welcome to bring any other relevant cases to the attention of the editors.

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Laurence Bary, Marion Lecole, Antitrust in the digital sector: An overview of EU and national case law, 30 June 2022, e-Competitions Antitrust in the digital sector, Art. N° 107112

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