Digital rules compliance

EU probes Apple, Google and Meta over digital rules compliance

Companies face fines of up to 10 percent of their global annual turnover if European Commission decides they are breaking the laws.

BY EDITH HANCOCK AND VARG FOLKMAN

The European Commission warned that Apple, Google and Meta may not be complying with new digital competition rules as it opened investigations that could lead to fines.

The probes come just 18 days after tech giants had to comply with Digital Markets Act (DMA) to open up their services to rivals.

"I definitely do not think that this is rushed. I think it is very timely reflecting the promises that have been given," Commission Executive Vice President Margrethe Vestager. "We have an obligation to the many, many consumers who expect change in this ecosystem."

The EU executive will investigate Google owner Alphabet and Apple's efforts to let developers steer consumers to offers outside their app stores. It will also probe Google to check if its display of search results favors its Shopping, Flights or other specialized search services over rivals.

Google lawyer Oliver Bethell said the company had made "significant changes" to the way it operates in Europe and "will continue to defend our approach in the coming months."

Apple will be investigated over its measures to allow users to do more to tailor their devices by uninstalling software, changing Apple's default setting or using choice screens to prompt users to pick a browser or search engine for their phone.

"Apple's measures, including the design of the web browser choice screen, may be preventing users from truly exercising their choice of services within the Apple ecosystem," the Commission said.

Meta's "pay or consent" model for social media such as Facebook or Instagram which asks for a subscription fee to avoid ad tracking "may not provide a real alternative in case users do not consent," the Commission said.

EU internal market chief Thierry Breton said officials had "serious doubts that the consent is really free when you are confronted with a binary choice" of either paying or not paying for the service.

Meta spokesperson Matt Pollard said subscriptions as an alternative to advertising "are a well-established business model across many industries."

The Commission has 12 months to conclude these investigations. Companies face fines of up to 10 percent of their global annual turnover if the Commission decides they are breaking the rules.

The EU is also examining Amazon to check if it favors its own brand products on the Amazon store. And it will also check Apple's new fee structure and other terms and conditions for downloading apps from outside its app store.

Breeton said "we are not convinced, to tell you the truth, of the new business model" related to Apple's app store changes.

Apple spokesperson Julien Trosdorf said the company was "confident our plan complies with the DMA" and that it has "demonstrated flexibility and responsiveness to the European Commission and developers, listening and incorporating their feedback."

Apple has openly criticized the DMA in recent months, saying the changes it had to make to its iPhones' operating system and its App Store would make users in Europe less safe and expose them to cyberattacks.