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Apple ( AAPL ) faces two charges of breaching EU rules

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Google accused of favouring its Search services

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EU issued preliminary findings on Wednesday

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Apple ( AAPL ) told to open up ecosystem to rivals

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Google could be fined up to 10% of annual sales

By Foo Yun Chee

BRUSSELS, March 19 (Reuters) - Google was hit

with two charges of breaching landmark EU rules on Wednesday,

while Apple ( AAPL ) was ordered to help rivals connect with its

iPhones and iPads, as Europe's antitrust regulators continued a

crackdown against Big Tech.

The move by the European Commission came despite threats

from U.S. President Donald Trump to levy tariffs against

countries which impose fines on U.S. companies.

Both Google and Apple ( AAPL ) have been in the European Commission's

crosshairs since March last year over concerns that they may not

be complying with the Digital Markets Act, which aims to rein in

the power of Big Tech via a list of do's and don'ts.

The EU competition watchdog on Wednesday issued preliminary

findings charging Google with DMA violations in both areas,

confirming a Reuters story from February 21.

The Google case centred on whether it restricts app

developers from informing users about offers outside its app

store Google Play, and whether it favours its associated search

services such as Google Flights in Google Search.

The Commission also issued two orders to Apple ( AAPL ) to open up

its ecosystem to rivals, six months after it began so-called

specification proceedings against the iPhone maker.

The first charge in the Google case focused on the company's

practices on its app store Google Play. Alphabet technically

prevents app developers from freely steering consumers to other

channels for better offers, regulators said.

A service fee charged by the company for facilitating an app

developer's initial acquisition of a new customer via Google

Play goes beyond what is justified, they added.

In the second charge, regulators said Google favoured its

own services such as Google Shopping, Google Hotels and Google

Flights over rivals.

EU antitrust chief Teresa Ribera said in a statement that

the measures "ensure that Alphabet abides by EU rules when it

comes to two services widely used by businesses and consumers

across the EU, Google Search and Android phones".

Google pushed back, saying that EU competition rules are

hurting consumers and businesses.

"The Commission's findings require us to make even more

changes to how we show certain types of Search results, which

would make it harder for people to find what they are looking

for and reduce traffic to European businesses," Oliver Bethell,

Google's senior director for competition, said in a blogpost.

If the company cannot charge reasonable fees to support the

ongoing development of Android and the Play services, it cannot

invest in an open platform, he said.

The first EU order against Apple ( AAPL ) requires the company to

give rival makers of smartphones, headphones and virtual reality

headsets access to its technology and mobile operating system so

they can connect with iPhones and iPads seamlessly.

The second sets out a timeline for Apple ( AAPL ) to respond to

requests from app developers for its systems to be interoperable

with others.

Apple ( AAPL ) said the EU order would hurt users and help its

rivals.

"Today's decisions wrap us in red tape, slowing down Apple's ( AAPL )

ability to innovate for users in Europe and forcing us to give

away our new features for free to companies who don't have to

play by the same rules," the company said in an email.

"It's bad for our products and for our European users. We

will continue to work with the European Commission to help them

understand our concerns on behalf of our users," it added.

Google, which has been fined more than 8 billion euros ($8.7

billion) by the EU in the last decades for various antitrust

violations, risks fines of up to 10% of its global annual sales

if found guilty of breaching the DMA.

Apple ( AAPL ) could face an investigation and potential fine if it

fails to comply with Wednesday's order.

Alphabet shares were up 1% at 1540 GMT. Apple ( AAPL ) shares were up

1.6%.

($1 = 0.9163 euros)