Competition regulation and enforcement trends in the EU’s digital economy

August 2026  |  SPECIAL REPORT: COMPETITON & ANTITRUST

Financier Worldwide Magazine

August 2026 Issue

Technological progress enabling digital services offered on digital markets has been reshaping the European economy in recent decades. Almost every aspect of economic activity, even in heavy industries and manufacturing, relies on digital products and services.

Many businesses – particularly start-ups and small and medium-sized enterprises – depend on online marketplaces, app stores and platforms as essential gateways to reach customers. Similarly, consumers increasingly spend time in digital and virtual spaces where they interact with each other, learn about new products and services, and consume such services.

The scope and importance of this major shift cannot be overstated. Digital platforms and digital products not only shape the economy but society as a whole, by influencing how citizens perceive ‘reality’, how they engage in political discourse and which issues dominate it.

To cope with the challenges digital markets pose with their accelerated dynamics, concentrative tendencies and threats of unwanted economic and potentially political power, the Europe Union (EU) has built a comprehensive rulebook for digital markets in recent years, encompassing traditional competition law (articles 101 and 102 of the Treaty on the Functioning of the European Union), sector-specific ex ante regulation (the Digital Markets Act (DMA) and the Digital Services Act (DSA)) and national law enacted by member states.

It is worthwhile to take a step back and look at the current trends in EU regulation and enforcement in the technology sector. 2025 was a particularly dynamic enforcement year, with many investigations and fines reaching record levels. Yet perhaps we may only be at the beginning of the ever-evolving digital revolution, with artificial intelligence (AI) starting to reshape the world.

DMA: reopening digital markets in the AI era

The DMA – applicable since May 2023 – has become the EU’s central ex ante regulation instrument for addressing entrenched gateway power in digital markets. It does not replace primary EU competition law but complements it by imposing specific and directly applicable obligations on designated gatekeepers to counter market power being entrenched through closed ecosystems, defaults, data advantages or self-preferencing.

Competition law is mainly enforced on a case by case basis after harm has occurred, which is perceived by many as too late. In contrast, the DMA intends to set very specific boundaries for market conduct of designated gatekeepers from the beginning.

Its success will depend less on the number of fines imposed than on whether it produces durable changes in market structure: lower switching costs, increased interoperability, access to key digital inputs and credible opportunities for challengers to scale.

Enforcement has moved quickly from designation to compliance disputes. The European Commission (EC) has designated Alphabet, Amazon, Apple, Booking, ByteDance, Meta and Microsoft as gatekeepers for a range of core platform services and has opened several non-compliance and specification proceedings.

In April 2025, it adopted its first DMA non-compliance decisions, fining Apple €500m for restrictions on steering users to offers outside the App Store and Meta €200m in relation to its ‘consent or pay’ model.

The effects of the DMA are indeed visible. Gatekeepers had to revisit app store rules, browser choice screens, data combination practices, interoperability arrangements and access conditions for business users. Smaller businesses, app developers and providers of connected devices can invoke rights that previously had to be pursued, if at all, through lengthy competition law proceedings.

Consumers have gained more meaningful choice over defaults, browsers, search engines and data use. Yet, compliance obligations can affect product rollout and technical integration, as Apple has publicly suggested when deciding not to introduce certain features in the EU (such as iPhone mirroring and Siri AI).

However, the DMA’s relevance in the next phase of the digital economy dominated by AI remains uncertain. The looming issues sound familiar: control over access points, leveraging across adjacent services, privileged access to data, self-preferencing, and the ability to set technical or contractual rules for dependent business users.

The EC has therefore started to test the DMA’s reach in AI-adjacent areas. In early 2026, it opened regulatory dialogue in specification proceedings with Alphabet, concerning its interoperability and search-data access obligations, including issues relevant to AI chatbots. Such proceedings may touch upon the deployment of AI tools within designated core platform services – for example Alphabet’s integration of AI into Google Search or Amazon’s AI-driven price filters on its Marketplace.

In June 2026, the EC took the preliminary view that the cloud computing services of Amazon (Amazon Web Services) and Microsoft (Microsoft Azure) should be designated as gatekeepers. Teresa Ribera, commissioner for competition at the EC, has signalled willingness to designate based on qualitative criteria where the defined quantitative criteria are not met. Another investigation examines whether the DMA can effectively address anti-competitive practices across the cloud value chain, given the cloud’s potential bottleneck role in AI development.

Overall, the DMA’s relationship with AI remains unsettled. AI models and AI applications are not expressly listed as distinct core platform services. Some AI assistants may fall within existing categories, such as virtual assistants, and AI functionality embedded into designated services may be caught where it affects those services.

Future autonomous AI agents, however, may not fit easily into the DMA’s existing taxonomy. This raises the question whether the DMA can remain sufficiently technology-neutral, or whether the EU will ultimately need to adjust the list of core platform services or adopt additional rules.

Abuse of dominance under article 102 of the TFEU: old rules, new teeth

Recent enforcement trends demonstrate that, alongside the sector-specific DMA, the abstract and more flexible prohibition of abuses of dominance remains a powerful and actively wielded instrument in digital markets. Landmark judgments, record fines, swift commitment decisions and – most recently – interim measures in AI-related cases confirm that article 102 of the TFEU is far from obsolete. It is, in fact, experiencing a remarkable renaissance.

In early 2025, the European Court of Justice delivered a seminal judgment in the Android Auto case, clarifying that a refusal to supply can be abusive not only if the input sought from the dominant undertaking is indispensable but also without indispensability if a digital platform is designed for third-party use. The ruling significantly lowers the enforcement threshold against platforms such as online marketplaces, cloud ecosystems or AI models that are inherently built to host third-party content and services.

The EC has also continued to impose substantial fines. In 2025, Google was fined €2.95bn – the second-highest fine ever – for self-preferencing in online advertising technology (currently under appeal before the General Court). The EC found that Google had favoured its own ad exchange and ad buying tools. It marks the fourth, heavy, article 102 TFEU fine imposed on Google since 2017. In 2024, the EC fined Apple over €1.8bn for abusive App Store rules that prevented app developers from informing iOS users about cheaper music subscription services available outside the app (known as ‘anti-steering provisions’).

But the EC also follows other routes to provide quicker cures to competition issues. It increasingly uses commitment decisions under article 102 of the TFEU, demonstrating that meaningful remedies can be achieved through dialogue and in shorter timeframes. In 2025, the EC accepted commitments by Microsoft on the tying of Teams to its widely used Office 365 and Microsoft 365 productivity suites for business customers. Similarly, in 2024, Apple offered commitments opening access to its near-field communication technology to rival mobile wallet developers.

The most important recent development, however, is the use of article 102 with a speed that defies the longstanding critique of antitrust proceedings as too slow and cumbersome for fast-moving digital markets. In mid-2026, the EC imposed interim measures on Meta requiring the company to restore free access to WhatsApp for rival general-purpose AI assistants and to maintain such access for the duration of the antitrust investigation initiated in December 2025.

These interim measures aim at preventing harm that may be impossible to repair in the rapidly growing market for AI assistants. Notably, the EC has deliberately relied on article 102 rather than the DMA for these AI-related cases, apparently regarding it as a more comprehensive framework.

The lesson for digital businesses is clear: article 102 of the TFEU is not merely surviving alongside the DMA – it is thriving, adapting to new technologies with surprising flexibility and agility. Classic competition law remains relevant in the digital age where the DMA framework may be too static in the short term.

Merger control

Mergers in the technology industry have also sparked questions about potential anticompetitive outcomes. One area of concern has been so-called ‘killer acquisitions’ – a term that refers to the acquisition of start-up companies including their human resources and technology at an early stage, allegedly to prevent them from developing into threats to dominant companies’ market positions.

Acquisitions of companies without significant turnover were not caught by the merger control rules.

After European courts scrapped the use of a referral mechanism under the merger regulation to establish jurisdiction to review below-threshold cases as unlawful in the famous Illumina/Grail case in 2024, an increasing number of member states have introduced new thresholds to bring alleged ‘killer acquisitions’ within their jurisdiction. This includes so-called call-in powers by which a competition authority can review transactions on a case by case basis. This adds considerable uncertainty, in particular to technology deals.

The concerns around transactions potentially entrenching market power in the tech sector are also addressed in the draft merger guidelines published for consultation in spring 2026. In the draft, the EC fleshes out its entrenchment theory of harm regarding ecosystems created by a bundle of distinct but interrelated services of online platforms that are shielded from competition by locking in customers, discouraging entry or otherwise raising barriers to entry.

Extending such ecosystems through the acquisition of companies offering adjacent services could potentially further impede competition. The Booking/eTraveli case is at the centre of this theory.

The EC prohibited the acquisition of the online travel agent (OTA) eTraveli by Booking in 2023 because it found the transaction would strengthen Booking’s already dominant position in the hotel OTA market. This theory and the EC’s decision are currently being challenged before European courts.

The outcome of the legal proceedings will shape dominant tech companies’ possibilities for external growth. In the draft guidelines, it appears that the EC defines quite strict conditions to be met before a transaction can be prohibited.

Outlook: new challenges from AI tools, agents and geopolitics

While European regulators are still in the process of dealing with Web 2.0 and in part Web 3.0 issues, the digital revolution has not slowed down but rather shifted into higher gear with AI rapidly developing.

AI has the potential to disrupt the internet, and not only the digital economy as we know it. The cards are being reshuffled. New players have entered the arena, threatening even the position of current gatekeepers which are also rapidly adapting. AI agents acting increasingly autonomously, with limited human interaction to solve problems, make choices and order products and services, may change everything.

Are the current regulatory regimes capable of tackling tomorrow’s problems? General competition law, resting on quite general concepts, seems flexible enough. As has been pointed out above, the DMA, on the other hand, only partially regulates AI tools.

Another question is what exactly are those problems demanding regulation? The EC has voiced concerns along the lines that AI technology may affect the contestability and fairness of digital markets by entrenching existing gatekeepers or creating new ones. Currently, the AI landscape seems very dynamic.

Perhaps the big bottleneck in this brave new AI world will not be software platforms or access to unlimited amounts of data, but rather computing infrastructure or parts of the hardware. Other considerations like AI sovereignty or transatlantic tensions may gain further weight and impact future regulation.

Already, DMA enforcement, primarily against US companies is perceived by some as a geopolitical issue. Technology companies active not only in the EU but also in the US or Asia are running the risk of getting caught in the crossfire of geopolitical skirmishes. It may be too early to tell today, and new regulation may therefore be premature.

 

Alexander Fritzsche is a partner and Sarah Zinndorf is an associated partner at Gleiss Lutz Hootz Hirsch PartmbB. Mr Fritzsche can be contacted on +49 (69) 9551 4535 or by email: alexander.fritzsche@gleisslutz.com. Ms Zinndorf can be contacted on +49 (69) 9551 4236 or by email: sarah.zinndorf@gleisslutz.com.

© Financier Worldwide

BY

Alexander Fritzsche and Sarah Zinndorf

Gleiss Lutz Hootz Hirsch PartmbB

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