Alphabet, Apple and Meta were told by European Union regulators on Monday that they are under investigation for a series of possible violations of the region’s new competition law.
The investigations are the first announced by regulators since the Digital Markets Act came into force on March 7, and signal the bloc’s intention to strictly enforce sweeping competition rules. The law requires Alphabet, Apple, Meta and other tech giants to open up their platforms so smaller rivals have more access to their users, potentially affecting app stores, messaging services, web search, social media and online shopping.
The Brussels investigations add to the regulatory scrutiny facing the biggest tech companies and show growing alignment between the United States and Europe over the need to crack down on companies for anti-competitive behavior.
Last week in Washington, the Justice Department sued Apple for violating antitrust laws with practices aimed at keeping customers dependent on their iPhones and less likely to switch to a competing device. Amazon, Google and Meta also face federal antitrust lawsuits.
EU investigators said they wanted to study whether Apple and Alphabet, Google’s parent company, unfairly favored their own app stores to exclude their rivals, in particular restrictions that limit how app developers can communicate with customers about with sales and other offers. Google is also being investigated over the display of search results in Europe, while Meta will be questioned about a new ad-free subscription service and its use of data to sell ads.
The European Commission, the executive arm of the European Union, can fine companies up to 10 percent of their global revenues, which for each amount to hundreds of billions of dollars a year. The commission has 12 months to complete its investigations.
The companies had already announced a number of changes to their products, services and business practices to try to comply with the Digital Markets Act. But in announcing the probes on Monday, regulators said their changes did not go far enough.
“Some compliance measures are failing to achieve their objectives and falling short of expectations,” said Margrethe Vestager, executive vice-president of the European Commission, who announced the investigations at a press conference in Brussels. Compliance with the law, he said, “is something we take very seriously.”
The investigations announced on Monday intensify a years-long campaign by European regulators to cut the biggest slack for tech companies in the digital economy. This month, Ms. Vestager announced a 1.85 billion euro ($2 billion) fine on Apple for unfair business practices related to the App Store. Amazon, Google and Meta have also been subject to EU investigations.
In an interview last month, Ms. Vestager said the United States and the European Union were more aligned now on the need to regulate the technology sector than a few years ago, when it was accused of unfairly targeting American companies. It said European regulators had contacted counterparts in Washington to “share notes”.
“I don’t think the partnership has been better for a long time,” he said.
The Digital Markets Act, first passed in 2022, was intended to give European regulators more powers to force tech giants to change their business practices without the lengthy process of filing traditional antitrust lawsuits, which can take years to resolve. A key aspect of the law is that companies cannot favor their own services over similar products offered by competitors.
As part of the investigations, Alphabet, Apple and Meta will now be required to disclose more information to regulators about their business practices. The companies said they were making changes to comply with the new rules.
Among the changes, Apple announced in January that developers would have new ways to reach customers in the European Union, including allowing external app stores to be available on iPhones and iPads for the first time. Google also made changes to its products, including how search results for flights, hotels and shopping services are displayed.
Meta has launched a new subscription service that allows EU users to pay €13 a month if they want to use Facebook and Instagram without ads. Regulators said the policy essentially forces users to either pay a fee or agree to have their personal data used to target ads.
“The commission is concerned that the binary choice imposed by Meta’s ‘pay or consent’ model may not provide a real alternative in the event that users do not consent,” the commission said in a statement.
A Meta spokesman said it would “continue to engage constructively with the committee”. Apple said it has “demonstrated flexibility and responsiveness to the European Commission and developers, listening to and incorporating their feedback.” Oliver Bethell, competition director at Google, said the company would “continue to defend our approach over the coming months.”
Many in the tech industry have questioned how aggressively EU regulators would enforce the new competition law. In Brussels, tech companies participated in workshops on how to implement the rules. At the same time, many app developers, competitors and consumer groups have complained to regulators that the changes made by the companies so far have been insufficient.
“Today’s launch of investigations into Meta, Google and Apple is a sure sign that the Commission intends to enforce the Digital Markets Act,” said Monique Goyens, director general of the European Consumer Organisation, a Brussels-based group that criticizes the technology industry.
On Monday, regulators also said they were gathering information about Amazon’s compliance with the Digital Marketplace Act. Regulators said the company may be favoring its own branded products on its online store, in violation of the law.
