Apple, Google and Meta could face huge EU fines under Digital Markets Act

Brussels — Apple, Alphabet’s Google and Meta Platforms will be investigated for potential breaches of the Digital Markets Act, EU antitrust regulators said on Monday, potentially leading to hefty fines for the companies.

The law, effective from March 7, requires six gatekeepers — which provide services such as search engines, social networks and chat apps used by other businesses — to comply with guidance to ensure a level playing field for their rivals and to give users more choices.

Violations could result in fines of as much as 10% of the companies’ global annual turnover.

The European Commission said it suspected that the measures put in place by these gatekeepers fall short of effective compliance under the act.

The EU competition enforcer will investigate 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”.

Asked if the commission was rushing the process, EU industry chief Thierry Breton said the investigations should not be a surprise.

“The law is the law. We can’t just sit around and wait,” he told a press conference.

He said Meta, which introduced a no-ads subscription service in Europe last November that has triggered criticism from rivals and users, should offer free alternative options. Google and Apple have similarly introduced new fees for some services.

A Meta spokesperson said the company was endeavouring to comply with the act’s guidance.

“Subscriptions as an alternative to advertising are a well-established business model across many industries, and we designed Subscription for No Ads to address several overlapping regulatory obligations, including the [Digital Markets Act],” a Meta spokesperson said.

Google, which said it had made significant changes to its services, said it would defend its approach in the coming months. Apple said it was confident its plan complied with the act.

The commission is also taking steps to investigate Apple’s new fee structure for alternative app stores and Amazon’s ranking practices on its marketplace.

The EU executive, which aims to wrap up the investigations within a year, the time frame set out under the act, said it had ordered the companies to retain certain documents, allowing them to access relevant information in its current and future probes.

The EU investigations came amid escalating criticism from apps developers and business users about shortcomings in the companies’ compliance efforts.

Reuters