EU Commences Investigation into Apple, Google, Meta, and Amazon for Violating Digital Markets Act
The European Commission has initiated a comprehensive investigation into Apple, Amazon, Alphabet, and Meta for their alleged non-compliance with the new Digital Markets Act (DMA) on March 25.
This investigation marks the EU’s first major effort to address anti-competitive practices by large tech companies, referred to as “gatekeepers” by the commission.
EU Targets Apple, Google, Meta Practices
The European Commission has opened five separate investigations to examine the business practices of Apple, Google, and Meta, which may violate the DMA’s rules on fair competition, as per the announcement.
The investigation will focus on Alphabet (Google’s parent company) and Apple’s “anti-steering” policies, which restrict tech companies from blocking businesses from offering cheaper alternatives outside their app stores.
The commission explained, “Today, the Commission has opened non-compliance investigations under the Digital Markets Act (DMA) into Alphabet’s rules on steering in Google Play and self-preferencing on Google Search, Apple’s rules on steering in the App Store and the choice screen for Safari, and Meta’s ‘pay or consent model.'”
Additionally, an investigation has been launched into Apple’s user preferences to determine if the company allows users to uninstall default apps and change settings for services like web browsers on iOS devices.
Alphabet is also under scrutiny for alleged non-compliance, particularly regarding its search engine recommendations. The inquiry aims to ensure that Google does not prioritize its specialized Google Shopping data over comparable search results from competitors.
The EU investigation will also examine Meta’s “pay or consent” model for Facebook and Instagram, which requires users to either purchase a subscription for an ad-free experience or consent to data tracking on the free version.
Strict Enforcement of the Digital Markets Act (DMA)
The DMA was introduced in November 2022 and came into full effect on March 7, 2024. Its purpose is to promote fair competition in digital markets, which have long been dominated by big tech companies.
EU Commissioner for Competition Margrethe Vestager has stated that despite the law’s launch in 2022, tech companies “seem to be at odds with the DMA’s intent.”
She warned that companies found guilty of violating the tech law could face fines of up to 10% of their global revenue and 20% for repeated offenses.
Apple has already been fined $1.95 billion by the EU for its anti-steering provisions, making it the first company to face penalties under the DMA. The fine was imposed earlier this month for restricting app developers from suggesting cheaper music subscription services to iOS users.
Alphabet, on the other hand, maintains that it is complying with digital regulations. Alphabet’s Director of Competition, Oliver Bethell, stated that the company has made “significant changes” to its operations in Europe.
The EU investigation is expected to be completed within 12 months, providing insight into whether the tech giants have fostered fair competition in the digital market or made adjustments that primarily benefit their own interests.
