DMA cloud gatekeeper designation: the EU acts as the UK holds back
In short: On 25 June 2026 the European Commission told Amazon and Microsoft that it provisionally regards AWS and Azure as gatekeepers under the Digital Markets Act. That preliminary view is the first move towards DMA cloud gatekeeper designation of a cloud service. The UK looked at the same two firms and chose a lighter route. If the Commission confirms its view, the obligations apply within six months.
The rules that govern AWS and Microsoft Azure are about to pull apart across the Channel. On 25 June 2026 the European Commission set out a preliminary view that both cloud platforms should be designated as gatekeepers under the Digital Markets Act. Designation would bring them inside binding obligations on data use, interoperability and self-preferencing. The Competition and Markets Authority looked at the same two firms and the same conduct and reached the opposite outcome. The Commission has chosen binding designation; the CMA accepted voluntary commitments and held its formal powers in reserve for a single, narrower target.
How DMA cloud gatekeeper designation works
The Digital Markets Act (Regulation (EU) 2022/1925) lists cloud computing as a core platform service. A provider becomes a gatekeeper when it has a significant impact on the EU internal market, operates an important gateway between businesses and their customers, and holds an entrenched and durable position. Article 3 presumes that a firm qualifies once it crosses the quantitative thresholds: EEA turnover of at least 7.5 billion euros or a market capitalisation of at least 75 billion euros, together with 45 million monthly active users. Neither AWS nor Azure meets those thresholds for cloud. The Commission has instead used the market-investigation route in Article 3(8) and Article 17, which lets it designate a provider on the qualitative criteria alone. No cloud service has been designated under the Act before, so the route matters as much as the targets.
The EU’s preliminary view on AWS and Azure
The Commission’s preliminary view is that AWS and Azure are each an important gateway between EU businesses and their customers, despite neither meeting the size thresholds. AWS is the largest cloud service in the EU and Azure the second largest. The Commission pointed to entrenched user bases, high switching costs and lock-in, and to artificial intelligence as a newer factor. AI tools and partnerships now drive much of cloud procurement, and the Commission found that AWS and Azure capture most of the AI-driven growth in demand within their own ecosystems.
Amazon and Microsoft were already designated as gatekeepers in September 2023, Amazon for its Marketplace and advertising services and Microsoft for LinkedIn and the Windows PC operating system. Neither cloud service was caught then. The Commission opened two designation investigations on 18 November 2025, alongside a third market investigation into whether the existing DMA obligations do enough to address cloud-specific practices such as obstacles to interoperability, conditioned data access and bundling. That third strand could update the cloud obligations by delegated act. The Dutch competition authority, the ACM, is supporting the work through a joint investigative team. If the Commission confirms its findings, it will list the services, and the obligations in Articles 5, 6 and 7 take effect within six months. The Commission confirmed in its April 2026 review of the Act that it would keep the framework as it stands, so the providers know in advance the obligations they would face.
How the parties and the market have responded
Both companies are resisting. Amazon has set out the fullest objection: in a policy paper its Associate General Counsel argues that the DMA was built for two-sided platforms and does not fit enterprise cloud, where there is “no intermediation, no network effects, no gateway“, and that the Data Act already regulates the switching, portability and interoperability the Commission is concerned about. Amazon also draws the UK contrast itself, noting that the CMA “recently decided not to designate AWS“. On the day of the findings an AWS spokesperson put it more bluntly, saying a “heavy layer of overlapping regulation under the DMA undermines European competitiveness”. Microsoft took a different line and pointed to a rival the Commission has not pursued, saying it “remain[s] concerned that ignoring the growing power of Google Cloud and Gemini will tilt the market in a harmful way“. Both firms will now make their fuller case through the rights-of-defence process.
Not everyone is resisting. The Open Markets Institute Europe welcomed the move, its director Max von Thun calling it “a major step in the right direction for Europe’s competitiveness, resilience and sovereignty“, while making Microsoft’s point from the opposite direction: applying the DMA to Amazon and Microsoft “but not Google’s … risks giving the latter an unfair advantage“. That shared concern about Google, voiced by a targeted firm and a competition campaigner alike, is the most telling feature of the early reaction. The argument now is as much about who has been left out as who has been caught.
Why the UK chose a different path on cloud
The CMA published the final report of its cloud services market investigation on 31 July 2025. It found that competition was not working well and that AWS and Microsoft each held up to 40 per cent of UK cloud infrastructure by value. Egress fees, technical barriers to switching and Microsoft’s software licensing were the main concerns. The inquiry group recommended that the CMA use its powers under the Digital Markets, Competition and Consumers Act 2024 to consider designating both firms with strategic market status in cloud.
The CMA Board declined. On 31 March 2026 it decided not to prioritise strategic market status investigations into either provider’s cloud infrastructure. It accepted voluntary commitments from AWS and Microsoft instead, to cut egress fees, lengthen free switching windows to 180 days and improve interoperability with rival clouds, with a review of progress after six months. The Board reserved its formal powers for one target. On 14 May 2026 it opened a strategic market status investigation into Microsoft’s business software ecosystem, focused on Windows Server and SQL Server licensing. AWS faces no strategic market status investigation in the UK. The chair of the cloud inquiry left the CMA early in 2026, and press reporting linked his departure to concern at the pace of follow-through.
DMA cloud gatekeeper designation: EU and UK compared
| Issue | EU: Digital Markets Act | UK: DMCC Act 2024 |
|---|---|---|
| Cloud providers caught | AWS and Azure (preliminary view, 25 June 2026) | Neither designated for cloud infrastructure |
| Mechanism | Gatekeeper designation, binding ex-ante obligations | Voluntary commitments under the market investigation regime |
| Designation route | Qualitative criteria via market investigation (Articles 3(8) and 17) | Strategic market status declined for cloud infrastructure |
| Microsoft software licensing | Within DMA obligations if designated | Separate SMS investigation into business software, opened 14 May 2026 |
| Compliance trigger | Six months after designation (Article 3(10)) | Conduct requirements only after an SMS designation |
| Review of decisions | EU General Court, full-merits review | Competition Appeal Tribunal, judicial-review principles |
What it means for cloud customers
A business buying cloud across both markets now finds the enforceable obligations in the EU rather than London. If AWS and Azure are designated, EU customers gain enforceable rights on data portability, interoperability and an end to self-preferencing. The providers must meet those obligations within six months, and the Commission can fine non-compliance at up to 10 per cent of global turnover. UK customers rely on the contractual commitments the providers have offered. The CMA can monitor those commitments, but they do not carry the same statutory force.
The commitments are already changing cloud contracts. AWS and Microsoft have extended free switching to 180 days and committed to at-cost multi-cloud egress through UK contract updates. Those terms apply on both sides of the Channel in practice, but only the EU regime turns them into obligations a regulator enforces directly. For an organisation running a large cloud migration or acquiring a cloud-dependent target, the divergence is a live point for cloud and technology contracts and for regulatory due diligence. The same convergence of competition and data rules that runs through competition law and data protection runs through the cloud question.
Viewpoint
The two regulators read the same evidence and drew different conclusions about tempo. The Commission provisionally decided that cloud concentration and AI-driven lock-in justify binding designation, and it used the qualitative route in Article 3(8) to get there. The CMA, having found that competition was not working well, chose commitments and a narrow probe of Microsoft, and let AWS out of the formal net for now.
The UK question I am watching is whether the CMA returns to strategic market status if the commitments fail. The market investigation findings are on the record, the DMCC Act powers are available, and the inquiry group asked for them to be used. The CMA has already shown with its first conduct requirements on Google that it will use the regime once it commits to it. The Commission’s third cloud investigation is the one to follow, because it may set the substantive standard against which the UK commitments are measured. Across the Digital Markets Act and the strategic market status regime, the two regimes have converged on outcome through different instruments, and cloud is unlikely to be the exception.
For advice on how the Digital Markets Act and the UK’s strategic market status regime affect your cloud contracts, procurement or a cloud-dependent transaction, contact Rob Bratby at Bratby Law.
