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EU Designates Booking.com as ‘Gatekeeper’ Under Digital Markets Act

 |  May 13, 2024

The European Commission announced on Monday the designation of hotel reservation platform Booking.com as a “gatekeeper” under the EU Digital Markets Act (DMA). This decision subjects Booking.com to stringent obligations aimed at ensuring fair competition and consumer choice within the digital market.

The EU’s designation of Booking.com as a gatekeeper comes as a result of the company meeting specific criteria outlined in the DMA, including having more than 45 million monthly active users and a market capitalization exceeding 75 billion euros ($81 billion). These criteria are indicative of companies providing core platform services for business users.

However, the EU’s regulatory scrutiny doesn’t stop there. The Commission also revealed that it has initiated an investigation into the regulatory status of social media network X, whose identity has not been disclosed. This investigation aims to determine whether X qualifies as a gatekeeper under the DMA, thereby subjecting it to similar regulatory obligations.

The Digital Markets Act, one of the most robust regulations targeting tech giants’ market dominance, imposes strict obligations on gatekeepers, including requirements to moderate content, facilitate fair competition and enhance consumer choice. Gatekeepers are mandated to comply with these obligations, failing which they face severe penalties.

Related: EU Extends Deadline For Booking Holdings’ Acquisition Decision

Under the DMA, gatekeepers must submit detailed compliance reports within six months of their designation. However, certain provisions of the DMA, such as the obligation to inform the Commission of any intended concentration in the digital sector, are applicable immediately.

Failure to comply with the DMA could result in substantial fines for gatekeepers, amounting to up to 10% of the company’s total worldwide turnover, with the potential for higher fines in case of repeated infringements. Additionally, the Commission may impose restrictions on takeover activities by non-compliant companies.

Booking.com joins a roster of tech giants previously designated as gatekeepers, including Alphabet, Amazon, Apple, Meta and Microsoft. These companies are subject to various obligations outlined in the DMA, such as ensuring interoperability of messaging apps and preventing anti-competitive practices, including favoring their own services over rivals’ offerings.

Source: Reuters