Special competition rules on digital ecosystems: Greece joins the club
On 6 August 2021 the new draft Greek Competition Bill (the new Bill) was published for a two-week consultation.1 It amends the Greek Competition Law (L.3959/2011) and aims to transpose Directive (EU) 2019/12 in order to enhance the enforcement powers of the Hellenic Competition Authority but also to modernise the existing framework by introducing special competition rules on digital markets. This analysis centers around these new special competition rules in light of the fact that the European Commission’s Digital Markets Act (DMA)3 is still pending.
The relationship between the new Bill and DMA
The introduction of special competition rules on digital markets by the new Bill comes at a time when the DMA is pending. The new Bill and the DMA, though they aim to achieve comparable outcomes, embark on their objectives from different starting points. On the one hand, the DMA aims to regulate large, systemic online platforms – the so-called “gatekeepers” – by imposing ex ante prohibitions that gatekeepers must comply with. On the other hand, the new Bill constitutes an amendment to the traditional competition rules in Greece, targeting online platforms and introducing certain dominance criteria. In that sense, the new Bill takes a novel approach by adjusting its competition rules to online platforms in a way similar to that of few other EU Member States (ie Germany, Italy) and consistent with traditional competition rules.
Scope of application
The new Bill introduces Article 2A which prohibits the abuse of power in an ecosystem of structural importance for competition. In particular,
- An “ecosystem” is defined either (1) as a network of interlinked and to a large extent interdependent economic activities of different undertakings that target the same group of users, or (2) as a platform that connects economic activities of different undertakings that target the same group of users.
- A “platform” is defined either as an undertaking that functions either (1) as an intermediary for transactions between interdependent end users and business users or only between end users or (2) as an infrastructure for the development and supply of different but interdependent products and services.
Therefore, the scope of the new Bill is not as granular as the one provided in the DMA but it seems to be sufficiently broad as to cover all cases that would not be subject to the DMA and would not fall under the standard competition rules on abuse of dominant position.
Assessment of structural importance
The assessment of the “structural importance for competition” does not rely on dominance as the standard Article 102 TFEU does, yet it factors in:
- the economic strength or the market share or inflows of the ecosystem relative to one or more sectors of the Greek economy;
- the access of the ecosystem to important resources, such as business users that rely on the ecosystem to reach the end users and sensitive data related to the competition;
- the importance of the ecosystem for third-party access to the Greek supply and sales market;
- the entire business model of the ecosystem when performing its assessment; and
- the sufficiently substantiated objective justifications put forward by the parties in relation to the relevant practices.
However, it is deemed that there is no structural importance for competition when there are at least four independent ecosystems in the market that constitute a viable alternative for the users. This quantitative threshold, though unusual in itself, seems to be justified on grounds of legal certainty. Nevertheless, it would be interesting to understand the rationale behind the selection of this specific cut-off threshold; the impact assessment accompanying the new Bill does not elaborate further on that.
The new Bill tries to strike a balance between legal certainty and flexibility when it comes to competition cases involving the digital market. On the one hand, it sets out a quantitative threshold above which this provision is deemed inapplicable, yet on the other hand it provides the Hellenic Competition Authority with sufficient flexibility when performing assessment of economic significance to take into account efficiencies that may result from the relevant business model and practices without binding it under a list of ex ante prohibitions, as is the case under the DMA.
ConclusionThe new Bill sets a different course compared to the DMA as regards digital markets. It provides for open-ended, flexible rules that allow the Hellenic Competition Authority to assess, among others, the efficiencies inherent in the digital ecosystems. This flexibility comes at the expense of legal certainty, which the legislator tries to mitigate by inserting the threshold of at least four ecosystems in a market, in which case the “digital” rules would not apply; which however may be seen as arbitrary. Overall, the nature of these rules seems consistent with the principles of Article 102 TFEU yet divergent to the ones of the proposed DMA, which takes a more formalistic, regulatory stance by setting out a list of ex ante prohibitions for large, systemic online platforms. In any event, Greece is taking a major step towards modernising its competition laws and joins a small group of other EU Member States such as Germany and Italy that have already or are in the process of introducing “digital” rules. Whether these new rules will prove effective given the small size of the Greek market and after the enactment of the DMA remains to be seen, but it shall largely depend on the stance the Hellenic Competition Authority is ready to take regarding digital ecosystems.
1 Greek Competition Bill (available in Greek).
2 Directive (EU) 2019/1 of the European Parliament and of the Council of 11 December 2018 to empower the competition authorities of the Member States to be more effective enforcers and to ensure the proper functioning of the internal market, OJ L 11, 14.1.2019, p. 3-33.
3 Proposal for a Regulation of the European Parliament and of the Council on contestable and fair markets in the digital sector, COM/2020/842 final.