EU Launches Probe into Tech Giants Over Digital Markets Act

The European Commission has initiated an investigation into the practices of Apple, Meta, Amazon, and Alphabet, specifically focusing on their compliance with the Digital Markets Act (DMA). The Commission suspects that these companies, referred to as “gatekeepers,” have not fully met their obligations under the DMA. Alphabet’s Google Play store and self-preferencing on Google Search, Apple’s App Store rules and Safari’s choice screen, and Meta’s “pay or consent model” are among the areas being targeted. The Commission is examining Apple’s new fee structure for alternative app stores and Amazon’s ranking practices on its marketplace.

To ensure effective implementation and compliance with their obligations, the Commission has ordered the companies to retain certain documents. The investigation will be conducted within a 12-month timeframe, and if any infringements are found, the Commission has the authority to impose fines of up to 10% of the company’s worldwide turnover. In cases of systematic infringement, the gatekeeper may be required to divest parts of its business or be prohibited from acquiring additional services.

The DMA is a legislation aimed at creating fair and competitive digital markets. It designates certain companies as gatekeepers, defined as large digital platforms with significant influence over the digital economy. Alphabet, Amazon, Apple, ByteDance (parent company of TikTok), Meta, and Microsoft are all identified as gatekeepers under the DMA. These companies were given until March 7 to fully comply with the DMA requirements.

This investigation follows a lawsuit filed by the United States Department of Justice (DOJ) against Apple on March 21. The DOJ claims that Apple’s app market rules and alleged monopoly practices stifle competition and hinder innovation. The lawsuit also accuses Apple of having a monopoly in the smartphone market and coercing developers to use its payment system, thereby locking in both developers and users on its platform.