The European Union (EU) is planning to look closely at Apple Inc. and Google's parent company, Alphabet Inc., to see if they are following new rules aimed at controlling big technology companies' power. These investigations might lead to big fines for the companies.
Officials are getting ready to check on the companies' actions under the Digital Markets Act, a new law. They are particularly interested in how Apple and Google charge app developers and the rules they set in their app stores.
After this news, Apple's stock price went down by 3.8%, and Alphabet's dropped by 0.9%. There's also talk that Meta Platforms Inc., which owns Facebook and Instagram, might face similar checks in the future for planning to charge users a monthly fee to use their platforms.
The EU's attention on Apple comes at a time when the company is also facing legal action in the United States. The US Justice Department and several states are suing Apple, claiming it unfairly stops other companies from competing by limiting access to certain parts of its iPhones.
The Digital Markets Act could allow the EU to fine companies up to 10% of their global yearly sales for breaking the rules once, and up to 20% if they keep doing it. The EU wants to finish these investigations within a year.
The companies involved have not commented on this matter. This step comes after Apple was recently fined €1.8 billion for not letting music streaming apps tell users about cheaper deals.
Spotify, a music streaming service, has called Apple's new charges for app developers unreasonable and has asked to speak with Margrethe Vestager, the EU's competition chief. Apple had suggested changing the 30% fee it usually takes from developers, but it also introduced new fees.
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