EU Commission launches first investigations on DMA compliance

The European Commission has launched its first investigations under the Digital Markets Act (DMA) against tech giants Alphabet, Apple, and Meta. This action comes in response to concerns that these companies, acting as gatekeepers, are not effectively meeting their obligations under the DMA.

The DMA, which came into effect on 7 March, aims to create a level playing field in the digital market by addressing issues of market dominance, unfair practices, and safeguarding consumer choice. Under this legislation, gatekeepers are required to adhere to certain obligations to ensure fair competition and transparency.

The Commission’s proceedings target specific practices of Alphabet, Apple, and Meta that are deemed potentially non-compliant with the DMA. Alphabet faces scrutiny for its handling of app stores and possible preferential treatment of its own services over rivals in vertical search. Apple’s practices related to app store steering and web browser choice are under investigation, while Meta’s “pay or consent” model regarding user data usage is being examined.

The Commission aims to conclude these proceedings within 12 months and will communicate its preliminary findings to the concerned companies. If violations are found, fines could be substantial, reaching up to 10% of a company’s global turnover, or even higher for repeated or systematic infringements. Additionally, the Commission could impose additional remedies such as divestiture of certain business units.

When announcing the investigation, Executive Vice-President Margrethe Vestager, responsible for competition policy, emphasized the importance of ensuring compliance with the DMA to foster open and competitive digital markets in Europe. Commissioner for the Internal Market Thierry Breton highlighted that while some changes are evident in the market, there are doubts about the adequacy of solutions proposed by Alphabet, Apple, and Meta in fulfilling their obligations under the DMA.

The European Commission’s actions underscore its commitment to promoting a fair and transparent digital ecosystem where consumers have genuine choices and businesses can compete on equal terms. These proceedings serve as a reminder to tech giants of the necessity to adhere to regulatory frameworks designed to safeguard competition and consumer interests in the digital age.