Out-Law News 2 min. read

First EU Digital Markets Act investigations opened

The European Commission has opened its first investigations into alleged non-compliance with the EU Digital Markets Act, just weeks after the new rules took effect.

Apple, Alphabet and Meta are among six businesses to have been designated as ‘gatekeepers’ under the DMA to-date. Some of the services they operate are classed as ‘core platform services’ and therefore fall within the scope of the new rules. Those services had to conform to the DMA’s conduct rules by 7 March.

Five investigations in respect of the three businesses were announced by the Commission on 24 March.

The Commission said it is investigating Alphabet and Apple over measures implemented in relation to their app store services, Google Play and the Apple App Store respectively, to determine if they comply with the steering rules in Article 5(4) of the DMA, requiring gatekeepers to allow app developers to “steer” consumers to third party offers. The Commission said it is “concerned” that Alphabet's and Apple's measures “impose various restrictions and limitations” on developers.

Apple is also being investigated by the Commission for its compliance with user choice obligations in Article 6(3) of the DMA in respect of its Safari browser service. The Commission said it is concerned measures applied by Apple, including the way it has designed its web browser choice screen, “may be preventing users from truly exercising their choice of services within the Apple ecosystem”.

An Apple spokesperson said: “We’re confident our plan complies with the DMA, and we’ll continue to constructively engage with the European Commission as they conduct their investigations.”

The Commission is separately investigating the way search results are displayed on Google Search to determine whether Alphabet’s measures comply with self-preferencing rules in Article 6(5) of the DMA, which prohibit gatekeepers from treating their own products and services more favourably than those offered by third parties.

A Google spokesperson said: “To comply with the Digital Markets Act, we have made significant changes to the way our services operate in Europe. We have engaged with the European Commission, stakeholders and third parties in dozens of events over the past year to receive and respond to feedback, and to balance conflicting needs within the ecosystem. We will continue to defend our approach in the coming months.”

In Meta’s case, its ‘consent or pay’ model is being investigated for compliance with personal data usage rules in Article 5(2) of the DMA. Meta began offering a subscription-based, ad-free Instagram and Facebook service in Europe last year. It previously said that the Court of Justice of the EU has endorsed the concept of a subscriptions model as a way for people to consent to data processing for personalised advertising. The Commission said, however, that it is concerned the pay model “may not provide a real alternative in case users do not consent”.

A Meta spokesperson said: “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 DMA. We will continue to engage constructively with the Commission.” 

The Commission said it intends to conclude the investigations within 12 months.

The Commission has also separately initiated fact-gathering probes into Amazon Store listings and Apple’s terms around users accessing apps from alternative sources than through its App Store. It further announced that it has imposed an obligation on Apple, Alphabet, Meta, Amazon and Microsoft, to retain documents it might use to assess the business’ compliance with the DMA. Meta has also been given an additional six months to ensure its Facebook Messenger service complies with the DMA’s rules on interoperability.

The Commission’s action follows separate enforcement action it took against Apple under EU competition laws earlier this month, where it fined the company €1.8 billion for abusing its dominant position in the market for the distribution of music streaming apps to iPhone and iPad users through its App Store. That case concerned the implementation of anti-steering rules, which are also expressly prohibited by Article 5(4) of the DMA.

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