International IP Law
Mémoire : International IP Law. Recherche parmi 298 000+ dissertationsPar pinocchio69 • 19 Décembre 2022 • Mémoire • 12 994 Mots (52 Pages) • 204 Vues
Alexandre Aubard Fall 2022
Intellectual Property Law Seminar
Law 6496
Professor Teresa Rea
Professor Mark Traphagen
Research Paper
European Tech Regulations: First Mover Advantage or Zero-Sum Game for Competition?
Table of Contents
Abstract 3
Introduction 4
The Digital Market Act and European Regulations 6
The Legal Building of the DMA: A Historical Overview 6
The New Era of Tech Legislations in the EU 11
The New Category of Tech Hegemons: Gatekeepers 18
A New Prisoner’s Dilemma for Competition, Copyright, and Innovation 23
Copyright and Innovation 23
A Prisoner’s Dilemma, Ex-Ante 25
The Reach of the Digital Market Act and the US Approach 31
The First Judicial Contestation of the DMA 31
Towards a Brussels Effect? 33
Conclusion 35
Bibliography 37
AbstractOn September 14th, 2022, the European (EU) signed a historical law: the Digital Market Act (DMA). Aimed at being the first law heavily regulating big tech competition in the world, the text particularly targets US multinationals by its scope. The DMA is a part of the digital Agenda for Europe set forth by the European Council, the Parliament, and the Commission, and follows the Copyright Single Market Act, and the Digital Service Act. The three texts should reshape the global governance of technology regulation. The DMA covers eight specific fields: online search engines; online intermediation services; social networks; video sharing platforms; communication platforms; advertising services; operating systems; and cloud services. Besides, the DMA creates a new specific category for the GAFAM, the gatekeepers. Through the articles V and VI of the Act, the EU hopes to create a competitive market by ensuring the interoperability and portability of the data and services. The companies the EU has classified as “gatekeepers” will be subject to new requirements such as preventing self-preferencing, or device neutrality. This new text, although young, will most probably have a great impact on existing intellectual property, forcing Gatekeepers to allow interoperability of devices and networks. The GAFAM, as well as the US government, heavily lobbied Brussels to protect their creations and systems. This paper will explore what the DMA and recent European regulations means in terms of intellectual property and competition, as well as probable repercussions in the EU and the US. We will also approach the regulation from a game theory approach. Gatekeepers will be forced to open parts of their IPs in order to comply with the regulation. If they technically can charge for its usage, there is an equilibrium pushing third parties to not pay. We will also show that game theory can explain the regulation rational from the European perspective. Finally, we will explore what the DMA could mean for the European Union and the United States. While the United States has the largest antitrust history, the EU seems to now be the regulatory leader, setting the new norms, perhaps global. Is there a first mover advantage for the EU? |
Introduction
The entry into force of the Digital Market Act (DMA) on November 1st, 2022, is supposed to mark a real turning point in tech regulation. The DMA is an innovative piece of legislation that aims at regulating “Big Tech”, and especially the GAFAM (Google, Amazon, Facebook/Meta, Apple, Microsoft), about their pricing and monopoly powers by covering eight specific technological fields: online search engines; online intermediation services; social networks; video sharing platforms; communication platforms; advertising services; operating systems; and cloud services.
The DMA is the latest regulation offered by the European Union aiming at leveling the playing field between the tech industry and political forces. The European digital agenda, which sets the objective for the 2020-2030 decade in terms of regulation, aims to create a secure digital space and services, strengthen Europe’s digital sovereignty, and contribute to climate neutrality. Before the DMA, the institutions of the European Union published the directive on copyright and related rights in the Digital Single Market[1], as well as the Digital Services Act[2]. The latest European regulations will try to protect online European users against unfair competition while the former implemented fair practices and transparency in the EU for different technological actors. Executive Vice-President Margrethe Vestager explained that the DMA and the DSA were filling the gap between illegality offline and online.[3]
The DMA follows more than a decade of tensions between the European Union (EU), and tech companies. The European Commission has been attacking big tech on different fronts, from illegal tax scheme through Luxembourg and Ireland, to antitrust practices. In 2018, the European Commission even imposed the largest fine in Google’s history of 4.3 billion euros[4].
However, the importance of the tech regulations lies elsewhere. The DMA implicates profound changes in the European tech market and forces the largest companies to transform their approach to competition. Although the DMA does not rest on the antitrust Articles 101 and 102 of the TFEU, this ex-ante regulation will require the gatekeepers to provide competitors with the technical means to interoperate with the platforms of these gatekeepers, thus resulting in a more competitive technological market and perhaps a Brussels effect. Besides, the regulatory methodology of the European Union places the regulatory burden of Gatekeepers on the private sector, requiring an increase in transparency.
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