EU Commission warns Alphabet and Apple they're breaking Europe's digital rulebook

Wednesday's decisions by the European Commission in a number of cases involving compliance of US big tech with the European digital legislation are unlikely to improve relations between the US and the EU.

A year after launching an investigation, the Commission has concluded that Alphabet's failure to let developers steer consumers outside its app stores to other offers means it does not comply with the Digital Market Act (DMA).

According to the Commission, the US giant does not allow any form of communication between developers and consumers and dissuades consumers from leaving Alphabet’s environment with a warning message.

In a separate investigation the EU executive found that Google was self-preferencing its services such as shopping, hotels and travel, giving its own offers prominence in the search results over third parties’ services, which is forbidden by the DMA.

If Alphabet does not abide by the Commission’s findings by offering a compliance solution, it risks a fine of up to 10% of its global annual turnover.

In a separate decision on Wednesday the Commission gave Apple two years to enable the operability of devices from other brands with its iPhones to comply with the DMA.

Apple was accused in June of breaching the DMA for preventing developers from steering consumers outside its ecosystem. If the tech giant has not offered solutions to ensure its devices work with third-party smartwatches, headphones, and virtual reality headsets within two more years, non-compliance action could ensue.

Apple is also under a non-compliance investigation launched a year ago under the DMA whose conclusion should be presented by the EU enforcer in the coming weeks. In this case, the Commission should decide whether Apple’s measures prevent users from freely choosing browsers outside Apple’s ecosystem.

A last investigation targets the tech giant’s new contractual terms for developers to access alternative app stores and the possibility to offer an app via an alternative distribution channel. The result of the investigation should be known by June.

EU probes into US tech giants have irked US President Donald Trump and US Congressional lawmakers.

In February, two members of the US House of representatives sent a letter to Commission Vice-presidents Henna Virkkunen and Teresa Ribera arguing that the DMA was directed against US companies and that the fines incurred were equivalent to taxes.