Three antitrust experts review the trends and cases that defined European antitrust and competition in 2024.
Apple’s unfair trading conditions and the Digital Markets Act
Alessia D’Amico, Utrecht University
One case that defined antitrust in Europe in 2024 is the European Commission’s App Store Practices case against Apple. This case was about Apple’s imposition of its proprietary in-app purchase system on music streaming app developers. More specifically, the anticompetitive behavior consisted of Apple banning developers “from fully informing iOS users about alternative and cheaper music subscription services available outside of the app and from providing any instructions about how to subscribe to such offers.” According to the Commission, this conduct constituted an abuse of dominance in the form of an unfair trading condition, in breach of Article 102(a) of the Treaty on the Functioning of the European Union. Apple’s conduct was neither necessary nor proportionate for the protection of its commercial interests and harmed iOS users as it resulted in higher prices and limited choice.
What makes this case notable is that although Apple’s conduct gave it a significant cost advantage over competing music streaming apps, such as Spotify, and distorted competition in the market for music streaming services, the theory of harm relied upon by the Commission was one of exploitation, not exclusion. In other words, the Commission found the conduct to be anticompetitive because it directly harmed consumers, without considering how it impacted the competitive process. This is rather peculiar considering the Commission’s traditional focus on effects and the ”more economics-based approach.”
The focus on concerns of a more redistributive nature, when it comes to digital gatekeepers like Apple, is in line with the introduction of the Digital Markets Act (DMA), which has the dual goal of promoting fairness and contestability in digital markets. The Act is designed to enhance firms’ ability and incentives to compete with gatekeepers and enable them to extract a greater share of the value they generate while using gatekeepers’ services. The Commission is now scrutinizing Apple’s measures to implement its obligations relating to the App Store under Article 5(4) of the DMA. Under this provision, gatekeepers are obliged to “allow business users, free of charge, to communicate and promote offers… to end users acquired via its core platform service or through other channels, and to conclude contracts with those end users”. The Commission is concerned that Apple might be infringing this obligation, among other things, by imposing charges on app developers.
By formulating the App Store Practices case as an exploitative abuse, the Commission has demonstrated flexibility in terms of the theories of harm it relies on to bring anticompetitive conduct to an end. The DMA, by disposing of the need to construct theories of harm, has the potential to go even further in correcting gatekeepers’ anticompetitive and unfair conduct in digital markets.
The Digital Markets Act has already delivered
Filippo Lancieri, Georgetown University Law Center
The antitrust community will long remember 2024 as the year that Europe’s Digital Markets Act (DMA), published back in 2022, really came into force. This regulation is helping reshape competition policy in digital markets after years of independent research showed the lack of competition in many different digital markets and advocated for a switch to a new regulatory approach.
The DMA certainly has its critics, who correctly point out many of its limitations. Above all, I agree with those who argue that the DMA will not alone deliver the boost to European GDP and innovation that the continent needs—this requires sound industrial policy, closer market integration, and the continuous enforcement of competition laws (among other strategies). Still, the DMA aims to increase fairness and contestability, and in doing so, it will help improve the competitiveness of European firms. Some say that the DMA is an enforcement failure, and that the core digital services that it covers, like internet search or mobile app stores, are no more competitive now than they were years ago. It will take time for the impact of the DMA to manifest in market outcomes, and the Commission is working hard and moving in the right direction with its multi-pronged enforcement approach. Indeed, it has a lot of past failures to unwind from the previous enforcement regime, such as the long history of failed remedies in the digital world—remember when the choice-screen “remedy“ imposed on Microsoft in 2009 simply disappeared for more than a year without anyone noticing (competitors including)? The reality is that these markets are very hard to crack open—if they weren’t, we wouldn’t need the DMA to begin with.
Above all, though, we need to celebrate the DMA successfully changing the antitrust conversation. The typical antitrust decision in digital markets—exactly those that recurrently failed to deliver on remedies—had the same structure: hundreds of pages on relevant market definition and liability and only a handful of pages dedicated to remedies (if that. A paragon of the problem, in the 2017 Google Shopping case remedies covered an incredible three pages of a 215-page decision). This model might work for cartels, but it does not work for complex abuse of dominance cases. What is needed is an interactive regime where solutions are debated within a broader ecosystem of stakeholders, which then provide input for a remedy that is constantly monitored and adapted by an authority with strong enforcement powers. This is exactly what the European Union’s Directorate-General of Competition (DG Comp) is delivering with its DMA roundtables, enforcement workshops, and fast-moving non-compliance decisions.
In other words, thanks to the DMA, most of the energy from the European antitrust academic and policy community has moved to where it should be at this stage: remedy design. We still have a lot to improve there, but the law is only a couple of years old. Honestly, we are further ahead now than I expected us to be. This should be celebrated as the major success that it is.
Other than remedy design and enforcement, the next steps are to devise systems that charge gatekeepers a fee to ensure appropriate funding for DGComp (as in the Digital Services Act) and to require gatekeepers to disclose all of their funding and data support to think tanks, academics, and other stakeholders that have a say in remedy design. It is way past time we took conflicts of interest seriously in antitrust.
Inadequate merger control
Max von Thun, Open Markets Institute
2024 saw an intensifying debate over whether the European Union’s merger control rules are fit for its purpose (hint: they’re not). Key issues include the European Commission’s powers to investigate “killer acquisitions” (acquisitions designed to quash competition and innovation), its approach to partnerships between tech giants and artificial intelligence startups, and the role of merger control when it comes to promoting Europe’s global competitiveness.
In September, the European Court of Justice (ECJ) struck down the Commission’s approach to investigating mergers which fall below the EU Merger Regulation’s (EUMR) turnover thresholds. Prior to the ruling, the Commission had been relying on a broad interpretation of Article 22 of the EUMR, which it argued permitted it to investigate deals that met neither EU nor national merger control thresholds so long as these were referred to it by member states. The ECJ disagreed, insisting that transactions cannot be referred to Brussels unless they are captured by national merger control regimes. Given that such deals—often described as “killer acquisitions”—aren’t going away, not doing anything is not an option for the Commission. But neither is there agreement on the solution. Options include strengthening national call-in powers so that more deals can be referred to the Commission, or expanding the EUMR itself—for example by adding a threshold linked to transaction value—to capture smaller mergers directly.
A growing number of partnerships between Big Tech firms and AI startups also poses a serious challenge to the EU’s ability to prevent harmful consolidation in digital markets. These partnerships—including Microsoft’s $13 billion investment in OpenAI, its mass hire of Inflection’s leadership and staff, and Amazon’s $8 billion stake in Anthropic—are seemingly designed to avoid merger scrutiny while providing many of the same benefits (access to cutting-edge technology, neutralization of potential competitors) to the tech giants. While the Commission is aware of the problem, its capacity to do anything about it is currently severely constrained by the EUMR. The Commission was unable to investigate Microsoft’s partnership with OpenAI because it did not meet the EUMR’s (overly) strict threshold determining when one business gains “control” over another. It was also helpless to do anything about Microsoft’s “reverse acquihire” of Inflection, despite concluding that a formal merger had taken place, in this case because of the ECJ ruling on Article 22. Here again the inadequacies of the current system point towards the need for reform, including reconsidering how the rules define “control.”
Finally, mounting concerns over Europe’s economic competitiveness—particularly vis-à-vis the U.S. and China—have led to growing calls for merger control more permissive of so-called “European champions.” Such calls have come primarily from large member states with significant industrial players—above all France and Germany—with echoes in influential reports by former Italian Prime Ministers Mario Draghi and Enrico Letta. These calls have been loudest in relation to the telecoms sector, with defense and financial services close behind. While Commission President Ursula von der Leyen and new Competition Commissioner Teresa Ribera have signaled their openness to this approach, others—including civil society groups, consumer associations and former officials—have criticized the push for consolidation, highlighting the importance of robust local competition in forging players that are competitive on the global stage. It remains to be seen which direction the Commission will take.
Authors’ Disclosures:
Filippo Lancieri was a co-author of a 2023 CERRE report on how to structure obligations for access to databases and algorithms under the DMA and the DSA. The regulators ARCOM and OFCOM and the companies Google, Booking.com, and TikTok jointly supported the report’s drafting.
Max von Thun works for the Open Markets Institute, which receives funding from foundations such as the Lumpkin Family Foundation, William and Flora Hewlett Foundation, Wallace Global Fund, Omidyar Network, Open Society Foundations, and Schöpflin Stiftung.
The authors report no other conflicts of interest. You can read our disclosure policy here.
Articles represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.
