By Mauro Orru 
 

Germany's Federal Cartel Office has opened a probe into Apple Inc. to gauge the iPhone maker's influence on cross-market competition, the latest development as tech giants come under growing scrutiny in Europe on antitrust and privacy grounds.

The cartel office said Monday that it would look at whether Apple's mobile operating system iOS created an ecosystem around its iPhone that extends across several markets, potentially making it difficult for other companies to challenge the tech giant.

The probe will also focus on the magnitude of Apple's technological and financial resources, access to data as well as its App Store, which enables the company "in many ways to influence the business activities of third parties," Cartel Office President Andreas Mundt said.

"An ecosystem which extends across various markets may be an indication that a company holds such a position. It is often very difficult for other companies to challenge such a position of power," the office said in a statement.

An Apple spokesperson told The Wall Street Journal that the company is ready to discuss its approach with the cartel office and to have an open dialogue about any concerns.

The probe comes after an amendment to German competition legislation came into force in January, with a new provision enabling the cartel office to take action in a speedier fashion against large tech companies.

Apple is the fourth tech giant against which the cartel office is taking action, after launching similar probes against Alphabet Inc.'s Google, Amazon.com Inc. and Facebook Inc. earlier this year.

The office has the power to prohibit companies that are of "paramount significance" for cross-market competition from engaging in anti-competitive practices in a two-step procedure.

The Apple probe stems from complaints the cartel office has received on potentially anti-competitive practices, including from the advertising and media industry against Apple's iOS 14.5 mobile software update that lets users prevent apps from tracking their activity and sharing it with other apps or websites.

The office also received complaints against the exclusive pre-installation of Apple's own applications as possible self-preferencing, while app developers criticized the mandatory use of Apple's in-app purchase system and the associated commission of up to 30% which Apple takes.

The cartel office said there could be a further proceeding to probe Apple's specific practices in more detail.

Apple is currently facing charges from the European Union for allegedly abusing its control over the distribution of music-streaming apps by requiring rival apps to use Apple's in-app payments system to sell digital content. The case stems from a complaint by Spotify Technology SA.

Germany's cartel office said it would make "contact with the European Commission and other competition authorities in this regard. So far, no decision on initiating a further proceeding has been taken."

 

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

 

(END) Dow Jones Newswires

June 21, 2021 06:59 ET (10:59 GMT)

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