The European Commission is looking into whether US hyperscalers, including Amazon Web Services (AWS) and Microsoft Azure, should face restrictions under the Digital Markets Act (DMA).

The DMA, which came into force on November 1, 2022, is an EU regulation that aims to make the digital economy fairer and increase competition.

The European Commission stated that it has opened three market investigations – two will assess “whether Amazon and Microsoft should be designated as gatekeepers for their cloud computing services,” while the third will assess if the DMA can tackle competition issues in the cloud computing sector.

The notice added that recent analysis of the cloud market has found that “Microsoft Azure and Amazon Web Services occupy very strong positions in relation to businesses and consumers,” and should they be found to be “important gateways” under the DMA, their cloud services will be added to the list of gatekeepers.

The third investigation will cover obstacles to interoperability between cloud computing services, limited or conditioned access for business users to data, tying and bundling services, and “potentially imbalanced” contractual terms.

In announcing these investigations, the commission has confirmed recent speculation. Publications such as Bloomberg had reported that the investigations were imminent, citing people familiar with the matter and stating that the October AWS outage had triggered renewed interest in the issue.

This itself was also shortly followed by issues with Microsoft Azure.

According to Bloomberg, cloud providers have previously avoided the DMA due to the large amount of business coming from enterprise contracts, which makes it hard to tell how many individual users were on the platforms.

Should the investigations find AWS and Azure fall under the scope, there could be penalties. The likes of Meta and Apple, which have been impacted by the DMA, have faced fines of €200 million ($231 million) and €500 million ($578 million), respectively.

This is not the first time the EU has called for such measures. In 2022, Cloud Infrastructure Service Providers in Europe (CISPE) backed a complaint made to the European Commission, arguing that Microsoft was conducting anticompetitive behaviours. CIPSE and Microsoft have since settled the dispute after a lengthy review process.

In the UK, the Competition and Markets Authority (CMA) concluded its own investigation earlier this year, stating that both Microsoft and Amazon would face further investigation.