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E.U. Takes Aim at Alphabet, Apple and Meta in Wide-Ranging Investigations

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Alphabet, Apple and Meta were told by European Union regulators on Monday that they were under investigation for a range of potential violations of the region’s new competition law.

The inquiries are the first that regulators have announced since the Digital Markets Act took effect on March 7, and they signal the bloc’s intention to tightly enforce the sweeping competition rules. The law requires Alphabet, Apple, Meta and other tech giants to open up their platforms so smaller rivals can have more access to their users, potentially impacting app stores, messaging services, internet search, social media and online shopping.

The investigations in Brussels add to the regulatory scrutiny the largest tech companies are facing globally. Last week in Washington, the Justice Department sued Apple for breaking antitrust laws with practices that were intended to keep customers reliant on their iPhones and less likely to switch to a competing device. Google and Amazon are also facing federal antitrust lawsuits.

The E.U. investigations center on whether Apple and Alphabet, the parent company of Google, are unfairly favoring their own app stores to box out rivals, particularly restrictions that limit how app developers can communicate with customers about sales and other offers. Google is also being investigated over the display of search results in Europe, while Meta will be questioned about a new ad-free subscription service and the use of data for selling advertising.

The European Commission, the European Union’s executive arm, can fine the companies up to 10 percent of their global revenue, which for each runs into the hundreds of billions of dollars annually. The commission has 12 months to complete its investigations.

The companies had already announced a number of changes to their products, services and business practices to try to comply with the Digital Markets Act. But in announcing the investigations on Monday, regulators said that their changes did not go far enough.

“Certain compliance measures fail to achieve their objectives and fall short of expectations,” said Margrethe Vestager, the European Commission’s executive vice president, who announced the investigations at a news conference in Brussels. Compliance with the law, she said, “is something that we take very seriously.”

The investigations intensify a yearslong campaign by European regulators to loosen the grip of the biggest tech companies on the digital economy. This month, Ms. Vestager announced a 1.85 billion euro ($2 billion) fine against Apple for unfair business practices related to the App Store. Google and Meta have also been subject to E.U. investigations.

The Digital Markets Act, first passed in 2022, was intended to give European regulators more authority to force the tech giants to change their business practices without the drawn-out process of filing traditional antitrust lawsuits, which can take years to resolve. A key aspect of the law is that the companies cannot favor their own services over similar products offered by rivals.

As part of the investigations, Alphabet, Apple and Meta will now be required to disclose more information to regulators about their business practices. The companies said they had made changes to comply with the new rules.

Among the changes, Apple announced in January that developers would have new ways to reach customers in the European Union, including allowing outside app stores to be available on iPhones and iPads for the first time. Google also made changes to its products, including how it displays search results for flights, hotels and shopping services.

Meta created a new subscription service that allows E.U. users to pay €13 per month if they want to use Facebook and Instagram without advertisements. Regulators said the policy essentially forces users to either pay a fee or agree to have their personal data used to target advertising.

“The commission is concerned that the binary choice imposed by Meta’s ‘pay or consent’ model may not provide a real alternative in case users do not consent,” the commission said in a statement.

A spokesman for Meta said it would “continue to engage constructively with the commission.” Apple said it had “demonstrated flexibility and responsiveness to the European Commission and developers, listening and incorporating their feedback.” Oliver Bethell, the director of competition at Google, said the company would “continue to defend our approach in the coming months.”

Many in the tech industry have wondered how aggressively E.U. regulators would enforce the new competition law. In Brussels, the tech companies have been participating in workshops about how the rules would be carried out. At the same time, many app developers, competitors and consumer groups have complained to regulators that the changes made by the companies so far were insufficient.

“Today’s opening of investigations into Meta, Google and Apple is a sure sign that the commission means business in enforcing the Digital Markets Act,” said Monique Goyens, director general of the European Consumer Organization, a group in Brussels that has been critical of the tech industry.

On Monday, regulators also said they were gathering information about Amazon’s compliance with the Digital Markets Act. Regulators said the company might be favoring its own branded products in its online store, in violation of the law.



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Magnitude 2.8 earthquake reported in View Park-Windsor Hills

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A magnitude 2.8 earthquake was reported Tuesday at 8:19 a.m. Pacific time in Los Angeles’ View Park-Windsor Hills neighborhood, according to the U.S. Geological Survey.

The earthquake‘s epicenter was 7.1 miles beneath the intersection of Overland Drive and Northridge Drive, near Windsor Hills Elementary School. .

In the last 10 days, there have been no earthquakes of magnitude 3.0 or greater centered nearby.

An average of 59 earthquakes with magnitudes between 2.0 and 3.0 occur per year in the Greater Los Angeles area, according to a recent three-year data sample.

Did you feel this earthquake? Consider reporting what you felt to the USGS.

Are you ready for when the Big One hits? Get ready for the next big earthquake by signing up for our Unshaken newsletter, which breaks down emergency preparedness into bite-sized steps over six weeks. Learn more about earthquake kits, which apps you need, Lucy Jones’ most important advice and more at latimes.com/Unshaken.

This story was automatically generated by Quakebot, a computer application that monitors the latest earthquakes detected by the USGS. A Times editor reviewed the post before it was published. If you’re interested in learning more about the system, visit our list of frequently asked questions.



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Justice Thomas returns to Supreme Court after 1-day absence

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WASHINGTON (AP) — Supreme Court Justice Clarence Thomas is back on the bench after an unexplained one-day absence.

Thomas, 75, was in his usual seat, to the right of Chief Justice John Roberts as the court met to hear arguments in a case about the Capitol riot on Jan. 6, 2021.

Thomas has ignored calls from some progressive groups to step aside from cases involving Jan. 6 because his wife, Ginni, attended then-President Donald Trump‘s rally near the White House before protesters descended on the Capitol. Ginni Thomas, a conservative activist, also texted senior Trump administration officials in the weeks after the election offering support and reiterating her belief that there was widespread fraud in the election.

On Monday, Roberts announced Thomas’ absence, without providing an explanation. Justices sometimes miss court, but participate remotely. Thomas did not take part in Monday’s arguments.

He was hospitalized two years ago with an infection, causing him to miss several court sessions. He took part in the cases then, too.

Thomas is the longest serving of the current justices, joining the Supreme Court in 1991.



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Germany’s Leader, Olaf Scholz, Walks a Fine Line in China

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Chancellor Olaf Scholz of Germany tried to strike a delicate balance on a trip to China this week, promoting business ties with his country’s biggest trading partner while criticizing its surge of exports to Europe and its support for Russia.

Mr. Scholz met with China’s top leader, Xi Jinping, at the Diaoyutai State Guesthouse in Beijing on Tuesday, the culmination of a three-day visit with a delegation of German officials and business leaders. He was also expected to meet with Premier Li Qiang, as the two countries navigate relations strained by Russia’s war in Ukraine and China’s rivalry with the United States, Germany’s most important ally.

Throughout his trip, Mr. Scholz promoted the interests of German companies that are finding it increasingly hard to compete in China. And he conveyed growing concern in the European Union that the region’s market is becoming a dumping ground for Chinese goods produced at a loss.

It was Mr. Scholz’s first visit to China since his government adopted a strategy last year that defined the Asian power as a “partner, competitor and systemic rival,” calling on Germany to reduce its dependency on Chinese goods.

Germany’s economy shrank last year, and its weaknesses have exposed a reliance on China for growth. Energy prices have risen because of the war in Ukraine, which has been facilitated by Beijing’s support for the Kremlin. German companies have pushed for more access to China and complained that they face unfair competition.

During his trip, which began in the sprawling industrial metropolis of Chongqing in China’s southwest and continued in Shanghai and Beijing, the chancellor visited German companies with extensive investments in China, met with trade representatives and talked with university students.

“Competition must be fair,” Mr. Scholz told a group of German-speaking students in Shanghai on Monday. “We want a level playing field,” he said.

Mr. Scholz’s trip was an example of the difficult dance that Germany is trying to do: maintaining economic ties with China while managing U.S. pressure to align itself more closely with Washington against Beijing. He was also expected to convey European leaders’ geopolitical and trade concerns to China.

In his meetings, Mr. Scholz highlighted Germany’s commitment to doing business with China, but he also warned that Beijing had to curb the flood of Chinese goods into Europe. At the same time, he expressed reservations about the European Union’s investigations into China’s use of subsidies for green technology industries, saying that any discussion about trade must be based on fairness.

“This must be done from a position of self-confident competitiveness and not from protectionist motives,” Mr. Scholz told reporters on Monday.

China’s manufacturing push in green sectors like electric cars and solar panels has touched off trade disputes with Europe and the United States, where such industries have also received government support. But with 5,000 German companies active in the Chinese market, Germany stands to lose more than many of its European partners would if Beijing were to retaliate against the European Union.

“If the E.U. goes too hard against China, we could expect countermeasures and this would be a catastrophe for us,” said Maximilian Butek, the executive director of the German Chamber of Commerce in China.

“For us it’s extremely important that the Chinese market remains open,” he said.

In his meetings with Chinese leaders, Mr. Scholz was also expected to raise concerns about Beijing’s support of Moscow’s wartime economy, especially its continued sale to Russia of goods with potential uses on the battlefield.

In his discussion with students in Shanghai, Mr. Scholz alluded to Russia’s war in Ukraine, saying that the world functioned best when all nations embraced some basic shared principles.

“One of these is that one should not have to fear its neighbors,” Mr. Scholz said, without naming any nations. “Borders cannot be changed with force.”

China is hoping to drive a wedge between Europe and the United States by courting leaders such as Mr. Scholz. State media reports depicted his visit as demonstrating the strength of China’s relations with Europe, playing up its economic ties with Germany.

Beijing is sure to welcome the message that German businesses are committed to China. The Asian giant is trying to court foreign investment to reinvigorate its economy, which has faltered because of a housing slowdown. Some Western businesses and investors have also been rattled by Mr. Xi’s emphasis on national security, which they regard as making it riskier to operate in the country.

From China’s perspective, Germany may be its best hope of delaying or watering down any trade restrictions from Europe, said Noah Barkin, a senior adviser in the China practice at the Rhodium Group, a research firm.

German carmakers have invested billions of dollars in China, and much of their revenue comes from there. Many worry that if the European Commission imposes higher tariffs on Chinese exports, and Beijing retaliates, German businesses will suffer most.

Chinese officials “know that German companies are heavily invested and they use that politically to influence political decision making in Berlin,” Mr. Barkin said.

Germany’s biggest companies, including BMW, Mercedes-Benz and BASF, are heavily invested in China and have strong, effective lobbies in Berlin, Mr. Barkin added. Executives from those companies, along with several others, traveled with Mr. Scholz to China.

“The supply chain in China is stuffed with German goods,” said Joerg Wuttke, a former president of the E.U. Chamber of Commerce in China. “If China has a price war with Germany, than no one will make money anymore.”

Chinese officials, for their part, have brushed off the European accusations of unfair trading practices, calling them groundless and an act of “typical protectionism.” They have hinted that they could retaliate for any actions taken by the E.U., saying that China was “strongly dissatisfied with and firmly opposes” its investigations.

Wang Wentao, China’s commerce minister, went to Europe last week to show Beijing’s support for Chinese companies and push back against the accusations that China was dumping goods on the region and posing a risk to global markets.

In an interview with the German newspaper Handelsblatt, Wu Ken, China’s ambassador to Germany, said the competitive of Chinese electric vehicles “relies on innovation, not subsidies.”

“The challenge faced by developed countries lies more in the fact that Chinese companies are more efficient,” the ambassador said.

Zixu Wang contributed reporting from Hong Kong.



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