On Monday, May 13, 2024, the European Commission announced it had designated Booking, the online intermediation service for booking hotels, as a gatekeeper under the Digital Markets Act (DMA).
The decision followed a March 1, notification that the company was a potential gatekeeper.
What is the DMA?
The DMA is the European Union's way of identifying and defining the big tech companies that act as ‘gatekeepers.’
It sets clear criteria to determine which major digital platforms are considered gatekeepers, ensuring that they play fair in the marketplace.
The goal of the act is to create a more equitable business environment for companies that rely on these platforms, to enhance opportunities for tech start-ups and innovators, and to give consumers more options.
What is a gatekeeper?
A gatekeeper is basically a company that holds a strong economic and intermediation role in the EU market, and this is not just temporarily, but rather proven to be durable over a longer period.
According to The Verge, to be labeled as a gatekeeper, a company needs to meet some specific criteria.
It should have an annual EU turnover of at least €7.5 billion for each of the last three years, or its average market capitalization should be at least €75 billion over the last year.
Plus, it needs to provide its platform services to at least three EU member states.
Also, the company should have a core platform service with at least 45 million monthly active users and 10,000 yearly active business users in the EU, again considering data from the last three years.
Also read
What are the next steps for Booking?
Booking will have six months to comply with the DMA and submit a detailed compliance report.
One of the most significant changes, according to Danmarks Radio, is that hotels will be entitled to sell rooms cheaper on their own website than on Booking, which may encourage consumers to book directly with the individual hotels instead of through intermediaries such as Booking.
“Today’s good news is: Holidaymakers will start benefiting from more choice and hotels will have more business opportunities. Following our decision Booking joins the list of core platform services required to adhere to DMA rules,” said Margrethe Vestager, Executive Vice-President in charge of competition policy.
And what about X?
Alongside the announcement concerning Booking, the Commission also announced that neither X nor TikTok’s parent company ByteDance would be designated as gatekeepers over their online advertising services.
However, for the next five months, X will be under a market investigation for other non-compliance with the DMA.
