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Apple, Google, Meta are among the first technology firms to be scrutinized under the EU's fresh Digital Markets Act
The European Commission is preparing to examine Google, Meta, Apple and various other tech firms to ensure they are adhering to the new Digital Markets Act. If these companies are found to be in violation, they could face a penalty amounting to 10% of their worldwide earnings.
The European Union (EU) is gearing up to probe into numerous tech firms, including industry giants such as Google, Meta, and Apple. The objective is to verify if these companies are complying with new regulations designed to limit the power of Big Tech. In case of non-compliance, these firms may face hefty penalties that could considerably impact their revenues.
Insiders have disclosed that the European Commission is gearing up to launch investigations into both corporations as per the EU's Digital Markets Act in the very near future.
The investigations will primarily target the newly implemented charges, rules, and stipulations introduced by Apple and Google for developers on their individual app platforms, as per the anonymous sources.
Furthermore, there are conjectures that a suggestion from Meta Platforms Inc., the parent firm of Facebook and Instagram, to implement a subscription charge for ad-free access to these platforms, might draw attention under the enhanced regulatory authority of the European Union.
The increased examination by the EU occurs at the same time as the US Justice Department and 16 state prosecutors are pursuing legal measures against Apple.
On Thursday, a lawsuit was lodged accusing Apple of antitrust breaches by obstructing competitors' access to its devices' hardware and software functionalities. This event triggered a drop of up to 3.8% in Apple's stock value during Thursday's market activity, with Alphabet also seeing a decline of up to 1.2%.
The Digital Markets Act gives the EU the authority to apply substantial sanctions, such as fines that can reach up to 10% of a company's overall yearly global income. If the company violates the rules repeatedly, the fines can be doubled. The regulatory authorities aim to wrap up their investigations within a year from the start of formal investigations.
Neither the European Commission nor Meta have issued any statements regarding the issue, and Apple and Google have not yet replied to inquiries for their input.
Apple has come under increased observation after the full enforcement of the Digital Markets Act on March 7th, following a recent €1.8 billion ($2 billion) penalty by the EU for hindering music streaming apps from notifying users about less expensive options.
Spotify, the company that initially raised concerns about Apple's App Store policies, has spoken out against Apple's proposed alterations under the Digital Markets Act. They have labeled the additional fees suggested by Apple as "illogical" and "intolerable". To address their issues, Spotify has sought a meeting with Margrethe Vestager, the chief of competition in the EU. Apple's proposal to scrap its traditional 30% fee and replace it with new fees has been met with controversy by industry watchers.
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