European Union regulators opened investigations into Apple, Google and Meta on Monday, the first cases under a sweeping new law designed to stop Big Tech companies from cornering digital markets, according to AP News.
The European Commission said it was investigating the companies for “non-compliance” with the Digital Markets Act.
The Digital Markets Act that took effect earlier this month is a broad rulebook that targets Big Tech “gatekeeper” companies providing “core platform services.” Those companies must comply with a set of do’s and don’ts, under threat of hefty financial penalties or even breaking up businesses.
The rules have the broad but vague goal of making digital markets “fairer” and “more contestable” by breaking up closed tech ecosystems that lock consumers into a single company’s products or services.
The Commission said in a press release that it “suspects that the measures put in place by these gatekeepers fall short of effective compliance of their obligations under the DMA.”
It added that it’s concerned that Google and Apple are imposing “various restrictions and limitations,” including charging fees that prevent apps from freely promoting offers.
Google is also facing scrutiny for not complying with DMA provisions that prevent tech giants from giving preference to their own services over rivals. The Commission said it is concerned Google’s measures will result in third-party services listed on Google’s search results page not being treated “in a fair and non-discriminatory manner.”
Google said that it has made “significant changes” to the way its services operate in Europe to comply with the DMA.
The Commission is also investigating whether Apple is doing enough to allow iPhone users to easily change web browsers.
Apple said it’s confident that its plan complies with the DMA, and it will “continue to constructively engage with the European Commission as they conduct their investigations.” The company said it has created a wide range of new developer capabilities, features, and tools to comply with the regulation.
The Commission is also looking into Meta’s option for users to pay a monthly fee for ad-free versions of Facebook or Instagram so they can avoid having their personal data used to target them with online ads.
“The Commission is concerned that the binary choice imposed by Meta’s ‘pay or consent’ model may not provide a real alternative in case users do not consent, thereby not achieving the objective of preventing the accumulation of personal data by gatekeepers,” it said.
New subscription fees for Meta’s Instagram and Facebook platforms will also be targeted by the probe, which could hit firms with fines of up to 10% of global revenue, or up to 20% in the case of repeated breaches, Bloomberg reports.
“We suspect that the suggested solutions put forward by the three companies do not fully comply with the DMA,” EU antitrust chief Margrethe Vestager said. She added that the probes involve “serious cases.”
The commission said it aims to wrap up its investigations within 12 months.