Will the DMA and similar national rules be enforceable at all, and who will remain to enforce in other areas?

Only recently, we have reported on various moves by senior antitrust officials to private practice. Today, we turn to the shift of responsibilities within the authorities and the question whether the European Commission and national European antitrust authorities have the capacities to enforce their new competition tools once they are made available to them.

New shiny tools – who is going to use them?

Since the European Commission published its draft Digital Markets Act (DMA) for digital “gatekeeper” platforms almost a year ago, the entire antitrust community in Europe has been excited nervous upset agitated interested in the new regulatory tools on the horizon. The excitement grew when the German government introduced the new rules for digital markets in German competition law at the beginning of this year. Irrespective of the (still unresolved) relationship between DMA and national regulations, the question arises as to who will make use of the new shiny tools.

A few drops in the ocean will not be sufficient

Regulating large digital platforms will require large resources by antitrust authorities. The DMA and corresponding national regulations are, to a large extent, breaking new legal ground. As tech is constantly changing, the behaviour to assess is similarly a moving target, making the issues to be examined very complex and multifaceted. Even the mere compilation of the facts underlying a case will require data, data and data and, in turn, quite a considerable amount of work. Due to their financial power and the relevant questions often touching the heart of their business models, large digital platforms can be expected to engage with authorities in detail, leading to lengthy proceedings. It would come as a surprise if just a few people at a given authority would be able to enforce the new rules. Rather, the authorities will have to assign numerous staff to these cases, especially if the proceedings are to be given the highest priority.

Where to take from if not to steal

The question for the competition authorities is how to create the necessary capacities without neglecting their other tasks. At least the national competition authorities seem to acknowledge that the European Commission might not have the required capacities to tackle the issues at hand. In their joint paper on “How national competition agencies can strengthen the DMA”, the heads of the national competition authorities of the European Union held that “it will be difficult for the European Commission alone to provide sufficient resources to enforce all the obligations and prohibitions referred to in the DMA”.  

But where can the required capacities be found? At least for the antitrust authorities in certain member states, a solution seems to be in sight: Some countries in Europe, e.g. Germany and Austria, have raised (or plan to raise) their merger thresholds only recently. This is likely to lead to a reduced workload on merger cases and might free up capacities for other work in the future. The steady decline in leniency applications and the corresponding drop of antitrust cases will of course also free up capacities within the national competition authorities and the European Commission (not neglecting that the European Commission seems to be quite active again in these days…). Another option is to hire new staff – especially for the generation that grew up with “big tech”, working on these cases may seem very attractive. In fact, together with the new rules in Germany the Bundeskartellamt planned to expand its headcount to tackle the new cases. The European Commission plans to add 80 full-time positions in order to enforce the DMA. Reportedly, China’s SAMR is also to recruit new employees in order to increase its capacity, and other competition authorities might follow.

If you really want something, you will find a way

The German Bundeskartellamt has opened proceedings against all GAFAs right after the latest amendment of the German competition law came into force. Obviously, it had sufficient capacity for this. Once the DMA enters into force, the European Commission will also make sure that it will be enforced swiftly. Currently, the responsibilities for the enforcement of the DMA are still being discussed, and one can see the importance of capacity issues being taken into account.

At the same time, a key question will emerge: What will happen to enforcement in other areas when authorities are bound by tech regulation in the coming years? While European authorities seem to be keen to make leniency more attractive and increase the number of cartel cases, there might be a scenario where capacity restraints could make enforcement more difficult, lengthy – and maybe even more unlikely (?).