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Competition watchdog investigates Apple and Google’s dominance in mobile phone systems

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The competition watchdog has launched an investigation into Apple and Google’s dominance of mobile phone operating systems, and whether it could hurt consumers. 

The Competition and Markets Authority will also look into the presence of the two companies in the app and web browser markets, to see whether their hefty presence is stifling competition, imposing harsh terms on small businesses such as app developers, or ripping off consumers.

It is the CMA’s latest probe in a series focused on big tech companies, as it sets up a new Digital Markets Unit. The unit’s work will be informed by the results of the market study, as part of the CMA’s efforts to establish a new pro-competition regulatory regime.

“Apple and Google control the major gateways through which people download apps or browse the web on their mobiles – whether they want to shop, play games, stream music or watch TV,” Andrea Coscelli, chief executive of the CMA, said.

“We’re looking into whether this could be creating problems for consumers and the businesses that want to reach people through their phones. Our ongoing work into big tech has already uncovered some worrying trends and we know consumers and businesses could be harmed if they go unchecked.”

The investigation also comes amid a global landscape of scrutiny on Silicon Valley’s biggest players. Apple is currently facing pushback against the fees it charges developers on its App Store in both the EU and the US.

In April, it was accused of breaking EU law with its policies, following a complaint from Swedish music streaming service Spotify.

Meanwhile last month saw the close of a high-stakes courtroom battle between Apple and Fortnite maker Epic Games, prompted by the latter’s attempts to circumvent Apple’s in-app payment system. The judge is still considering her verdict.

Meanwhile a ruling at Europe’s top court on Wednesday opened the floodgates for more local challenges to technology firms, concluding that national data watchdogs of EU countries can pursue companies even if they are not their lead regulators.

Because many US tech companies have their European headquarters in Ireland, it has previously fallen to the country’s Office of the Data Protection Commission (DPC) to oversee the likes of Google, Twitter, and Apple on data protection issues.

The DPC has faced criticism from its counterparts in other countries for being too slow, accusations it has dismissed.

But the EU Court of Justice (CJEU) said that under certain conditions, a national supervisory authority may “exercise its power to bring any alleged infringement of the GDPR [General Data Protection Regulation] before a court of a member state, even though that authority is not the lead supervisory authority”.

Lawyers said that the ruling marked the limits of the one-stop-shop mechanism, under which one country’s privacy authority is the lead regulator.

“The implications are that the one-stop-shop mechanism under the GDPR is not exhaustive and leaves some room for local regulators such as the Belgian DPA to enforce the laws in particular by bringing court proceedings before a national judge,” commented Toni Vitale, partner at Gateley Legal.

Matthew Holman, a solicitor who specialises in data protection, privacy and technology law at law firm EWM, told it was too early to tell whether the ruling could open the floodgates for more challenges to tech firms across Europe, but it had made it a possibility.

“It is definitely good news for consumers,” he added.

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