Council document outlines significant differences with Parliament on definition of custodian –


Defining active users for basic platform services is one of the main ways of identifying a gatekeeper, but the services to be covered by it differ considerably in the texts submitted to the European Parliament and to the Council. , according to a draft Council document seen by EURACTIV.

The Digital Markets Act (DMA) is a legislative proposal intended to impose specific obligations on gatekeepers, online platforms so large that they play a systemic role in the digital ecosystem. How to define a guardian remains a fundamental point of discussion in the co-legislative process.

In its proposal, the European Commission has defined two criteria that must be met to qualify as a guardian.

Financially, it is a platform that operates in at least three Member States and whose turnover for the last three years and market capitalization for the last year are above certain thresholds. The exact thresholds are still under discussion and could change until very late in the negotiations.

The other criterion concerns the number of users of the platform which, as it stands, should be 45 million active end users per month. Where 10,000 active professional users per year. Business users are those who use the platform in a professional capacity, while all others are considered end users.

User criteria refers to the “core” services of the platform, which can include everything from search engines to social networks to messaging applications. The very different nature of the services also results in a different definition of active users, which the Commission text does not provide.

Both the Parliament and the Council, which represents the 27 Member States, have tried to fill this gap, with some similarities but also considerable differences.

Core platform services

According to an internal Council document from last week, viewed by EURACTIV, the main differences compared to the draft report submitted in June to the European Parliament’s Internal Market Committee (IMCO) concern the very definition of basic platform services rather than that of active users.

Crucially, which services are considered “core” will determine which platforms fall within the scope of DMA. A first list of basic platform services is provided in the Commission proposal, towards which the co-legislator converges, including social networks, video-sharing platforms, interpersonal communication services, operating systems and online advertising.

However, the two texts also show significant divergences on key aspects of the original proposal. For example, the IMCO project divides app stores and online marketplaces into separate basic services, while the Council follows the Commission by including both in online intermediation services.

While the Commission and the Council assess search engines as a basic platform service, the parliamentary text considers them to be a type of online market.

The IMCO draft report follows the original proposal to define cloud computing as a basic service, but only includes a definition for business users. On the other hand, cloud computing services are not mentioned at all in the Council text.

The IMCO project only mentions online advertising services, like the Commission, but does not provide a definition of active users, which is instead present in the Council text.

Definition of active users

The parliamentary text considers that for online markets, search engines and video sharing platforms, the definition of active end users should be based on the IP address. This approach could prove problematic as an increasing number of Internet users use technologies such as proxies, which mask or modify IP addresses.

Council text is broader because most active end users are defined as the “number of unique end users who have signed up with” a certain service.

Another difference concerns business users on marketplaces, search engines and video sharing, as the parliamentary project includes companies with paid rankings or paid subscriptions.

The Council’s definition includes all businesses with an item listed on an ecommerce platform or a video that has been uploaded or watched at least once.

A larger gap could concern business users of social networks, as the IMCO report also includes “application developers entering the social network in a given year”.

The Council’s project includes all companies that have “engaged in any way” with the social network, which may or may not cover the case of an application allowing connection through a social network profile.

For digital advertising, the Council already has a definition project for both proprietary sales and advertising intermediaries. For end users, this includes anyone who has been exposed to at least one ad in the past month. Likewise, the definition covers all “unique advertisers who had at least one advertising impression displayed during the year”.

The two texts largely converge to define end users of social media, business users of search engines, and all kinds of active users for operating systems and interpersonal communication services.

[Edited by Zoran Radosavljevic]

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