The European Commission is investigating whether Apple Inc is using anti-competitive iPhone sales tactics and technical restrictions to squeeze out rival smartphone makers from the European market.

According to The Financial Times, the Commission is focusing on distribution terms that might favour Apple by ensuring no rival can secure a better sales deal.

Apple said its contracts comply with EU laws, said the newspaper.

The inquiry is the result of private complaints from mobile operators and is at a preliminary stage.

Before a formal probe can be launched, the Commission would need to be confident that Apple was dominant in the EU smartphone market, which may be hard to show given the popularity of Samsung Electronic's Galaxy handsets.