Brussels, 26 March 2024 (dpa/MIA) - The European Commission said on Monday that it will investigate Apple, Meta, and Google-owner Alphabet over suspected violations of European Union rules for online "gatekeepers."

The probes are the first non-compliance investigations under the EU's Digital Markets Act (DMA), which took effect on March 7 and regulates the behaviour of companies the commission deems to be "gatekeepers" in the digital economy.

A gatekeeper is a company that holds a powerful, entrenched position in the EU's digital economy, acting as an intermediary between many users and businesses.

The commission has designated six gatekeepers: Alphabet, Amazon, Apple, Tiktok-owner ByteDance, Meta and Microsoft.

Gatekeepers that fail to comply with their obligations under the DMA can face fines as high as 10% of their global annual revenue. Repeat offenders may be fined up to 20%.

The investigations into Alphabet and Apple concern suspected non-compliance with a DMA provision requiring gatekeepers to "steer" customers to offers outside their app stores, free of charge.

For example, the two companies "constrain, among other things, developers' ability to freely communicate and promote offers and directly conclude contracts," a commission press release said.

Also under scrutiny is whether Alphabet gives preference to its services in Google search results.

"The commission is concerned that Alphabet's measures implemented to comply with the DMA may not ensure that third-party services featuring on Google's search results page are treated in a fair and non-discriminatory manner in comparison with Alphabet's own services," the EU executive said in its press release.

Google's competition director, Oliver Bethell said in a statement: "To comply with the Digital Markets Act, we have made significant changes to the way our services operate in Europe." He added, "we will continue to defend our approach in the coming months."

Furthermore, the commission is investigating whether Apple complies with various DMA rules governing user choice in iOS, the operating system for its smartphones and tablets.

In particular, the probe will examine whether iOS makes it easy enough for users to uninstall any app they wish and to change the default settings.

The commission is also investigating whether Apple is adequately fulfilling its DMA obligation to prompt users with screens asking them to choose between alternative defaults for certain apps and services, such as the web browser or search engine.

In a statement, Apple said: "We're confident our plan complies with the DMA, and we'll continue to constructively engage with the European Commission as they conduct their investigations."

The DMA investigation into Apple is entirely separate from the €1.8 billion ($1.95 billion) fine imposed on the company by the commission on March 4, for unfair competition in the music streaming market. That fine - which Apple has said it will appeal in court - was issued under broader EU competition law, not the DMA.

Meta is being investigated over its recently-introduced policy of asking users to choose between paying to use its services and consenting to their personal data being shared between the company's services - such as Facebook and Instagram - for use in targeted advertising.

"The commission is concerned that the binary choice imposed by Meta's 'pay or consent' model may not provide any real alternative in case users do not consent, thereby not achieving the objective of preventing the accumulation of personal data by gatekeepers," the EU executive said on Monday.

Dpa has contacted Meta for comment.

The Computer and Communications Industry Association (CCIA), a tech lobby group, said: "Launching the first preliminary investigations under the Digital Markets Act (DMA) just days after the compliance deadline throws a wrench into the idea of companies and the European Commission working together to implement the DMA successfully."

"This move risks confirming industry fears that the DMA compliance process might end up being politicized," CCIA's European chief Daniel Friedlaender said in a statement.

The commission said it intends to wrap up its investigation within 12 months. The DMA itself requires that the commission "endeavour" to decide cases within 12 months of having opened proceedings.

Although the commission has not announced a DMA non-compliance investigation into Amazon, its press release on Monday said that the online retailer may be giving its own brand products on the Amazon store an advantage.

The commission said it is taking "investigatory steps to gather facts and information" to clarify whether that is the case.

Similarly, it will look into whether Apple's terms and conditions for the use of alternative app stores on its devices "may be defeating the purpose of its obligations" to make such use possible.

A commission official said these two actions are requests for information, non-compliance investigations. Nevertheless, such requests can turn into formal investigations, though they don't have to, the official said.

The EU executive is also asking Alphabet, Amazon, Apple, Meta and Microsoft - five of the DMA's six gatekeepers - "to retain documents which might be used to assess their compliance with the DMA obligations."

As with Amazon, the commission has not announced a non-compliance investigation into Microsoft. The press release does not mention any actions with regard to ByteDance.

Photo: MIA Archive