Antitrust in the Digital World: Does it Work? – Ten Minutes With MP Alex Agius Saliba

Below, we have provided the full transcript of the interview with MP Alex Agius Saliba, from the first episode of our series, “Antitrust in a Digital World: Does It Work?“.

Morgane TAYLOR:

Good afternoon and welcome to CPI Live. I’m Morgane Taylor from the APP Association. Thank you for joining us today. On today’s agenda, we’ll discuss digital platform regulation and the widespread impact of European Commission Proposal for a Digital Markets Act. The APP Association and Competition Policy International launched a discussion series on competition in the online environments where we gather experts in antitrust and policy makers from around the world to explore the key issues surrounding the application of antitrust in digital world, focusing on global trends in regulation, but also to dive into legislative proposals to regulate platform as the one we have currently on the table in Europe. So today I’m pleased to welcome Mr. Saliba, member of the European Parliament for the Socialists and Democrats, for a 10 minute discussions on these European developments. Welcome.

Alex AGIUS SALIBA:

Thanks for the invite. It’s my pleasure.

TAYLOR:

So Mr. Saliba, you are a member of the Internal Markets and Consumer Protection Committee, of the European Parliament and you were leading the Parliament’s position on what should Digital Markets Act look like when you were up for the Legislative Initiative Report on Digital Services Act. So at the time, your report tackled both the need to have clear rules on moderation of online content and responsibilities of online access, as well as the need to keep markets open and competitive for all, including the smallest ones. So today, these issues are separated in two different proposals by the European Commission, respectively, the Digital Services Act, DSA, and the Digital Markets Act, also known as the DMA. So maybe my first question is as an officer for the Legislative Initiative Report on the Digital Services Act, do you find that the current Commission Proposal in particular here on the DMA reflects well what was proposed by the European Parliament?

AGIUS SALIBA:

Yes. I think that a number of key features that the European Parliament, specifically the Internal Market Committee, was pushing forward in our reports. Our recommendation was a very, very ambitious recommendation. For example, we move forward the “know your business customer” instrument. We moved forward a separate liability regime for online marketplaces and move forward specific issues, also when it comes to defining who gatekeepers, having a systemic role on when it comes also to the DMA.

When it comes to notice and direction, harmonize procedure under the DSA, I think a number of suggestions move forward by the Internal Market Committee were taken up by the Commission. But again, as we say, the devil is always in the detail. We have a lot of details here. So we have a lot of more ambition that we wanted to see from the Commission and a number of aspects.

For example, the “know your business customer” was a key take for us, but we believe that the Commission could have been much more ambitious. That because it is only restricted for online marketplaces and they wanted to own their business customer provision to have, and have a wider perspective.

When it comes to recommender system, we wanted to have more transparency, not only for big tech companies, but for all service providers, because ultimately one of the fundamental features, and one of the fundamental pillars, both for the DSA and also the DMA, is to have this level playing field. Also, when it comes to transparency, to boost consumer confidence.

When it comes to the principle of high level of consumer protection, we believe that instead. When it comes also to principles of creating a more contested digital market, or so to help direct where SMEs to become more competitive. To create this level playing field between that country sellers who have a different set of rules, which apply for them, making them more competitive in our market when compared to our SMEs, our innovators, our startups because they have to, basically, put up themselves with a number of technical harmonization when it comes to health and safety, and other technical regulation, which is so important.

So this extra territorial element will definitely help in this regard to make our SMEs much more competitive out there, as definitely, the DMA will definitely do to create a small contestable environment for our innovators, for our startups, for our SMEs. So overall, yes, it’s a proposal going in a good direction. It’s ambitious, but if I want to be critical, it would have been much more ambitious in a number of areas. So the Commission’s proposal is a good starter for discussion, but I believe, and I will definitely push also in the amendments, for more ambition.

TAYLOR:

And so you’re saying that this is a step in the right direction, and we see that a number of obligations there. How do we make sure that we do not create at the same time, because it’s an ecosystem, right? And it’s not a zero sum game. Everybody benefits from each other, even though there are issues to be tackled. So how do we make sure that we’re creating the right rules and the right obligations that do not have unintended consequences on the smaller players and in generally, what will be your priorities moving forward when working on the file?

AGIUS SALIBA:

So, I think that first of all, even during the discussions that we had before we came up with the official Parliament position, when it comes to the DMA, was to be was to be restrictive. Was to be restrictive by having a bulletproof definition, only to target those players when it comes to the DMA who have a gatekeeping role, who have a systemic role out there. If we ended up with a too wide definition and encompassing also SMEs, startups, we would ultimately be putting much more burdens than necessary on our SME.

So I think that the definition being moved forward by the Commission, the thresholds, having effect and presence in three different Member States. So I think when you look at the set of requirements to fall under the definition of the DMA, I think that they set the standards whereby they are affecting and putting this to-do list, which puts more responsibility on these players, because with bigger size, with bigger influence, comes also bigger responsibility. And I think that this is one of the prominent features of the DMA.

TAYLOR:

Yes. And I mean, when we talk about the ambition of the proposal and the fact that yes, we should focus on the bigger ones, but at the same time SMEs’ stay rule. And we sit today in Europe that different Member States are taking different tech regulation in their own hands. Such as in France, in Poland, for online content, also in Germany with new competition rules. Should we be concerned about the segmentation? You as an actor, at European level, and would this be detrimental? For example, for small scale that do not have the resources to deal with different kind of rules.

AGIUS SALIBA:

So what is the reason that is behind the DSA and DMA? One of the most important issues, for us as legislators, was that of doing away with a lot of backtrack legislation. Because backtrack legislation, legislation affects all players, but ultimately, as you were saying affects worst on smaller players who don’t have the means, who don’t have the resources to have legal teams and advisers in 27 different Member States. I think that is one of the most, this burdensome different rules and different Members States, is one of the biggest barriers for SMEs, for smaller players to ultimately be able to make the full potential and the full use of the best elements of our union, which is that of a single market, a single digital market. So, yes, I am concerned when I’m seeing different initiatives to be undertaken because the political discourse is there, and the political pressure is there. And the moves from the Commission are more clear. And from the European Institutions, when it comes to the DMA.

On the other hand, if you tackle this issue from a legal perspective, the competence, as we speak, still rests in the hands of Member States. So I think that ethically, that even from the Commission, I think that that message has to be sent out there, because ultimately the exercise that we’re doing is that of reducing these backtracks. And ultimately, we are running up with different initiatives being undertaken, before we conclude this lengthy process. And now with dialogues with Council, Commission, and Parliaments, different negotiations being undertaken on both dossiers, the DMA and the DSA. So I think that the Commission has to be clear on this because ultimately smaller players will ultimately be affected more negatively if we have, and we continue to have these different initiatives, different sets of rules and different Member States.

TAYLOR:

Yeah. The issue will be really to strive the right balance there. So I think we’ve come to the end today of our 10 minutes chat. I would like to say, thank you very much for your interesting views.

AGIUS SALIBA:

Thanks to you.

TAYLOR: And we’ll start straight afterwards with a panel about the Digital Markets Act with different antitrust experts and app developers. Thank you very much.