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E.U. & Antitrust Newsletter Portugal

The transposition of the ECN + Directive will allow the Competition Authority to access smartphones, tablets or cloud servers

Directive 2019/01/EU of the European Parliament and of the Council, better known as the ECN + Directive, aims to attribute to the competition authorities of the Member States jurisdiction for applying the law more effectively and guarantee the effective functioning of the internal market.

Inter alia, the directive establishes not only the obligation of the Competition Authorities to comply with the “general principles of Union law and the Charter of Fundamental Rights of the European Union” but also the need to safeguard the independence of their actions.

The Member States must therefore ensure the necessary conditions so that the Authorities might perform their inspection activities and define to what extent these objectives can be pursued. 

In Portugal, the draft bill for the transposition of this directive was subject to public consultation. Of particular note was the possibility of the Competition Authority carrying out searches, examinations and collections and taking copies, of any type of information or data, in any format, whether hard copy or digital. It can therefore now access all types of technological devices, such as smartphones, tablets and cloud servers in order to obtain information related to the company under investigation.

The draft bill also opens the possibility of finding parent companies liable for infringements of competition law by their subsidiaries. Such is a result of the application of the notion of undertaking used in the Court’s jurisprudence.

The directive states that the Member States have until February 4, 2021 to transpose it; otherwise, the European Commission might open formal infringement proceedings.

Ursula von der Leyen promises the adoption of the Digital Services Act

It is no secret that the digital policy of the European Union still falls short of that of the large-scale digital global players. The European Commission believes that integration involves promoting talent and educating European citizens so as to open up a space for innovation and competition on the digital market.

At present, the control of the digital market is carried out by platforms with great market power, known as technology giants, such as Microsoft, Apple, Google, Facebook and Amazon, the economic importance of which allows them to greatly influence the market. The EU has taken an active stance in fighting against alleged abusive practices by these operators.

Through this Act, the European Commission intends not only to combat the abusive practices of the technology giants, but also to guarantee fair competition. In order to strengthen the position of the EU as regards digital power, it is essential for European start-ups to have the chance to enter the market without being obliterated by platforms with significant market power.

From a competition perspective, the question arises of whether the current legal framework of Competition Law guarantees a suitable level of protection on the digital market. A study carried out by the European Commission emphasized the need to adapt the current rules to the features of this market (click here).

It therefore seems that questions such as the defining of the relevant markets, subject to constant change, the interdependence of the platforms and the calculation of market power promise to fill the agendas of the Competition Authorities and the European Commission in the coming years.

In contrast, it is also likely that a lively discussion will take place over the correct level of participation of the Commission and the Competition Authorities of the Member States that might participate mistakenly in the digital market, with it creating its own barriers to the full development of services useful for consumers. After all, it is hard to find anyone defending the idea that companies such as Amazon, Google, Apple, Facebook and Microsoft should not contribute daily to improving the way in which we interact on the market.